Seller claim after completion

calebsp

Hello,

After completing the contract as the buyer of a leasehold property the seller has subsequently made a claim for an outstanding credit from a service charge paid to Southwark Council. Southwark is the freeholder of our property.

I am in the process of investigating the veracity of their claim but they're threatening to take me to small claims so my question is - do they have any right at law to reclaim service charges (if indeed they were refunded) after we have completed on the sale? ... its now over two years since completion if that matters and I first heard from the seller about 4 months ago on this matter

Hopefully this is posted in the right place! Appreciate any responses or hints of where I can do some of my own research... initial searches have come up blank
Thanks!

HouseBuyer77

Ah, totally misread your post, please ignore

(Did have a response here, which made no sense)

calebsp

Hi Housebuyer - thanks for the quick response! From your response it sounds like you are assuming I am the seller not they buyer? I am the buyer - why would I be answering questions about anything outstanding during the sale? The seller is now making a claim against me

HouseBuyer77

So a more sensible reply:

So they say they had overpaid the service charge, leaving a credit on the account. They are now claiming that credit back off you?

Was there in fact a credit? Did you receive a refund?

I suspect it's tough luck for them. When you take over a lease you take over service charge and ground rent arrears, so presume it also works the other way.

Marktheshark

Call them out and say you sought legal advise and the advice is to let a District judge make judgment at county court as you have a case law defence to the demand.
That will get them thinking

Nick_C

I'm guessing that this relates to the overpayment of water rates prior to you buying the property.

The previous owner was overcharged by the Council. They are morally entitled to have that overpayment refunded.

If the refund has been applied to your current service charge account, you should give it to the previous owner.

If you are not prepared to do that, then if I was the previous owner I would take legal action against you.

Get into litigation and the only winners are the lawyers.

Do the right thing.

calebsp

To be clear: The amount being claimed is for service charges: Annual charge by the freeholder (council) to mow the lawns, upkeep of the building, etc.

I never received a refund but the claim is that the account was in credit - I am in the process of completing my own reconciliation but its taking time given the quality of the data available from the council

Nick_C

Ok. In that case both solicitors should have dealt with this as part of completion. Any credit on the SC account should have been added to your completion statement and paid to the vendor. Tell the previous owner to raise this with his solicitor.

Hoploz

Could it be that your solicitor kept an amount on retention?. If this happens an amount is kept back from the sale to cover any amount outstanding when it is calculated at the end of the financial year and if all is found to be paid up then the retained amount should be returned to the seller when the accounts are all finalised.

calebsp

My solicitor has been very poor at responding and so far has ignored all my correspondence. I had no real complaints with them during the process but trying to get info out of them now if difficult. FYI we used 1stpropertylawyers

davidmcn

calebsp wrote: »

My solicitor has been very poor at responding and so far has ignored all my correspondence. I had no real complaints with them during the process but trying to get info out of them now if difficult.

Well, didn't they explain at the time of the transaction how this was intended to be dealt with?