Leasehold flat - service charges query

Whoknowskt89

Hi all
Wondering if anyone can assist. Long story cut very short we've had issues with the company running the flats we live in and ended up forming a housing association. Due to the building being a mix of flats and businesses we can't obtain right to manage.

We've been in discussion with the management agents over costs for quite some time and very recently a different company has taken over. I've just received this from the head of the association (I've taken out company names) but wanted to check if it's correct as the head thought we could manage it at one point and I don't want to end up with issues!
X = old company
Y = new company
Z = owners
"...write to let you know that I have been in contact with X and with Y regarding the leaseholders outstanding service charges, with the purpose of a deduction of the return of management costs will be taken from this charge.

At present, this seems to be the better way forward to start the clear up the arrears.

The total to be deducted from your arrears is as follows for a single dwelling: £856.12

I trust you all find this to be in order and those of you who have paid your service charges fully to date can deduct this amount from your next service charge invoice payment to Y in July.

Under the Landlord & Tenant Act 1985 the Landlord (Z) by their Managing Agent,X under Section 20 have to inform the leaseholder of any long term agreements, which cover more than £100.00 per leaseholder. I enclose a summary page of the Act for your perusal. Because of the management increase with X we should have had a Notice of this expense, as we were all to contribute an extra £132.00. Double for those with two flats.

As I wrote in my previous emails we can either take the matter up of a refund within the LVT courts, which will cost us the court fee's. Or as the Landlord may not be able to recover these costs back from us, as X gave us no notification, we can deduct it now and then the landlord if he wishes can pursue us through the courts. The costs will then be on them. But we have a very good case, as we all know and I cannot see this going to court, but never say never. However, don't let that put you off as given the mess I have uncovered over the last year, we have many rights on our side.

This matter of the £100.00 per leaseholder is for long term contracts which apply to all matters within the building as well as management, apart from the other Section 20 Act for one off large contracts over £250.00 per leaseholder, so I will delve deeper to see if there have been any other errors."


The cost she is saying to deduct is actually more than what I should be billed in July.

Any assistance would be highly appreciated!

Hoploz

Speak to the person who has written this letter. It's gobbledygook for you and most likely everyone else she has sent it to!

Ask her to explain it - she is surely meant to be the middleman who cuts through all this sort of language and puts it in plain English for the other leaseholders!

Whoknowskt89

Thanks

I've called her and what's she saying is as our old management company employed someone long term for works that cost each flat over £100 and due to not being notified of other works and fees we should either
Deduct money from arrears
Deduct money from next service bill (I'm not in arrears)

As we are a registered association in dispute with the management agents we can withhold money and they'd have to take us all to court

I must say she isn't the best at explaining things simply or I'm just really struggling with leasehold law.

I just want to know if I really should deduct this and I don't want to end up with them saying I'm in breach of lease and try to get me out basically. Most of the owners here are for buy to let.

AlexMac

Let's be charitable and forgive the fact that the head of your residents' association isn't very good at expressing herself in writing. She's doing her best negotiating on your behalf, so we should ignore the odd incoherent paragraph, and the dodgy grammar (such as the unnecessary Grocers' apostrophe in the bit where she says "will cost us the court fee's").

She has taken the view that as the freeholder's agent screwed up, you should all knock a chunk off your service charge or ground rent; in your case 800-odd quid.

I think you should back her. Do as she says. Stick together. The freeholder's last agent was obviously hopelessly inefficient, and whether or not she has actually agreed a deal with the new ones; what they gonna do? Sue? I doubt it.

The only problem could be, years down the road, that if you come to sell, and the agent says, on the Freeholder replies to the buyer's solicitor, that there is a debt of less tan £1k... you just pay up.

But let's cross bridges when we come to them.

Do as she says.

See what happens. And encourage your neghbours to do likewise.

There is no way a freeholder can get you out ("determine your lease") over a trivial disputed service charge.

Or take over the Residents' Association yourself if you can spare thr time and if you think you can do better?

Whoknowskt89

I know it's not an easy job and I wouldn't want to do it.
I was at a point helping out a lot but she ended up in an email to the old management company getting personal and insulting to them and not being professional so I stepped back.
The lady works in property for a living and from what she's said, has taken another management company to court for a different flat.

I just wanted to know where I stand as leasehold isn't always the easiest to understand where it comes to disputes etc