Service Charge Dispute with Managing Agents

Chris_Justice

Hi all,

I'm having a bit of a dispute with my managing agents over maintenance payments and its come to a bit of a deadlock. I'm not really sure where to go next other than refusing to pay and getting taken to court so thought I'd try seeking some advice on here - first and foremost to find out if I'm even right or being a total tit. Here's the issue:

• Until June 2017 maintenance of the building was managed by Company A at which time it switched to Company B (who I currently have a dispute with).
• The lease specifies that payments should be taken to cover the period from 1st Jan to 31st December in advance.
• Company A used to issue invoices every March and October. March invoice covered Jan - Jun and October invoice covered Jul - Dec.
• In October 2015 I agreed with Company A to pay by monthly instalments to make my life easier.
• When Company B took over, Company A issued me with a statement of account which showed ZERO balance as of October 2015 (when I started direct debits) with monthly payments being received until July 2017 when the handover took place. Since they invoiced in two 6 month blocks the statement showed me as having two outstanding payments for August and September.
• Company B stated they were re-baselining the invoicing periods to run from Jan-Jun and Jul-Dec and then issued me with an invoice to cover the outstanding period of June to Dec. On top of the full six month invoice they added the two month outstanding balance supplied by Company A.

This is where my dispute arises. At the point when Company A ceased management duties I had paid 7 out of 12 months for 2017. Because of their nominal invoicing period they showed me as in arrears for 2 months.
Company B are now requesting 6 months payment PLUS the two outstanding from Company A. That would mean I have paid 15 months maintenance in 2017.
I have tried pointing out that they are overlapping and that I only owe for 5 months but they are refusing to accept it and keep issuing the inflated invoice. I even contacted Company A who agreed with my position and stated that I should only owe 5 months.
I have spoken to both the building manager and the director of Company B, neither of whom accept/understand what I am trying to tell them. They just keeping stating that I owe for 6 months plus 2 in arrears despite the fact I have sent them my account statement showing me fully paid up to July.

What on earth do I do?!

Thanks in advance for any suggestions

Chris

eddddy

I wonder if you are over-thinking this?

You are essentially paying money into your 'account' held by the managing agent (a bit like if you were paying money into your 'holiday fund' account).

As long as all your payments are reaching your 'account', is there much of a problem?

If you overpay, it just means that you may have a surplus in your 'account' (or less of a shortfall) at the end of the year.

I guess it's a bit frustrating that the managing agent doesn't understand, but you shouldn't lose out as a result.

Chris_Justice

Hi Eddddy,

What they are asking me to do is clear the balance for this year so they can start fresh from zero in January 2018. If I pay what they have asked I will have paid 3 months too much for 2017 but it won't put my account into surplus, it will simply be lost.

Cheers,

Chris

ThePants999

Since you're in the right, refusing to pay and getting taken to court doesn't seem that bad an option to me... the court will agree with you! Just make sure that you've put it all clearly in writing first.

eddddy

I think you may be misunderstanding how service charges work. They are not a fixed monthly or yearly amount - like rent, for example.

They are your share of the bills

Chris_Justice wrote: »

What they are asking me to do is clear the balance for this year so they can start fresh from zero in January 2018.

How can they start from zero in Jan 2018?

They don't know what the electricity bill will be for Dec 2017, they don't know whether a the roof will spring a leak that has to be repaired in Dec 2017.

i.e. They don't yet know what the total bills are for 2017 yet.

The managing agent just adds up all the bills they've had to pay for the year, and splits them amongst the leaseholders.

But they estimate (or guess) at the beginning of the year how much all the bills will add up to, and ask you to make advance payments to cover them.

If they've under/over estimated the value of the bills, it's adjusted at the end of the year. (And if you've under/overpaid during the year, that would be taken into account as well.)

Chris_Justice

I see what you're saying but the problem is that they don't see that I've overpaid. They simply think I owe for 6 months plus the two outstanding months carried over so if I make the payment I would in their eyes be up to date as per the maintenance estimate. For whatever reason they are refusing to accept (or not understanding) that I have already paid until July and the two outstanding months carried over only apply if the invoice is run from October. Since they are backdating it they should ignore the two outstanding months and deduct a month for the payment I already made for July. Its very odd because as I say I've slapped them in the face with evidence that this is the case and they are simply refusing to accept it.

TrickyDicky101

I understand why you're aggrieved - and I don't think I'd want to go along with what eddddy's saying as that implicitly relies on the management company having accurate records reflecting what you have actually paid - and from everything you've said of their responses so far it isn't something I would be confident of!

I also think you have relatively little to fear from being taken to court (assuming everything is documented) - although it would be galling if you won and then the management company try and bill you (and the other leaseholders) for their legal costs in the next service charge round!

LEJC

Are you proposing to take the company to court,or your own set of fellow leaseholders and yourself for whom they manage the money.

Surely a dispute between a leaseholder and the company for whom they manage the funds of is just going to result in fighting yourself.

How much is it claimed that you owe?

or do I have the wrong end of the stick?

Chris_Justice

I owe £850 for the remainder of the year but they are claiming £1350. I'm not suggesting I take anybody to court but I won't pay what they are asking because it isn't right. I suspect it will end up with them taking me to court because they aren't accepting what I'm saying. I'm wondering if there is another way to to approach them, some sort of third party mediation maybe to look at the account and make a decision?

LEJC

So you suspect that they will take you to court...sorry,to be pedantic but I still can't work out if you are talking about the managing agent or the management company that is made up of the leaseholders of the property.

Have you referred it to the complaints department of the company that manage the funds....I believe that if you follow that route and do not get a conclusive outcome it can then be referred onwards for further judgement.

some years ago I had a dispute over an admin charge that was levied via the agents that managed a block that I was a leaseholder of...I believe I ended up somewhere up a chain of complaint and in the end settled with paying half the original amount...however my complaint was against the managing agent rather than the management company to which I was a member as a leaseholder....

look on the company website and follow the complaint trail; if you have not already done that...they should display the terms prominently on their website

so for you the amount in dispute is £500 if you take out what you are expected to pay for the remainder of the year as rolling costs?

Are you the only leaseholder who is in this position or did others pay at the same frequency as you?

Presumably when the end of year accounts are documented any excess funds should show up at that point.
There must have been a handover point between the 2 companies which has yet to reveal the funds in the sinking funds and general funds....these figures would not have been zero at handover.

bouicca21

Can you ask Company A to confirm the two payments?