Demand for administration fee?

straas

I'm having a disagreement regarding an administration fee.

I was sent what I considered to be a demand for an administration fee due to unpaid ground rent. The demand did not come with the summary of rights attached - therefore it wouldn't be valid?

The person I'm dealing with is insisting that administration charges don't have to be demanded? Ground rent is demanded, then administration fees are added (without a demand) for late or non payment.

Is this correct?

eddddy

I'm guessing you are a leaseholder, and you're talking about a demand from your freeholder.

Based on what you say, you are correct...

Any administration charge demanded by the landlord must be reasonable in order for the landlord to recover the charge, and must be accompanied by a summary of the leaseholder!!!8217;s rights and obligations in respect of administration charges. If the summary is not included, the charge is not regarded as being payable unless, and until, the demand is made with the summary.

Link: https://www.lease-advice.org/advice-guide/service-charges-other-issues/

But to resolve this, all the freeholder has to do is re-send the demand with the summary of rights attached (within 18 months) - assuming the fee is reasonable.

straas

Yes - the complicating factor is that I disputed the charge with the freeholder - instead of responding, they referred the case to a debt collection company.

The debt collection company have added additional fees, the account now stands at near £400.

The debt collection company are suggesting that I have photocopied a letter from the freeholder, and omitted the summary of rights.

eddddy

So you're saying...

1. You received a correct demand for GR (including the summary of rights) - but you didn't pay.

2. You received a demand for a late fee - did this include a summary of rights? And you didn't pay.

3. You have now received a demand for an even larger late fee - which didn't include a summary of rights.

A key question is whether you received a summary of rights with the demand at point 2. If you didn't, that definitely seems to make the demand at point 3 invalid.

G_M

At the end of the day the debt collection agency can't do anything.

It would have to go to courtt and a judge would then decide if
* th charges were reasonable
* the summary of rights had been included

Of course, the longer you hold out, the more the costs will rise if you lose, so it's a gamble on what to do

G_M

eddddy wrote: »

So you're saying...

1. You received a correct demand for GR (including the summary of rights) - but you didn't pay.

2. You received a demand for a late fee - did this include a summary of rights? And you didn't pay.

3. You have now received a demand for an even larger late fee - which didn't include a summary of rights.

A key question is whether you received a summary of rights at point 2. If you didn't, that definitely seems to make the demand at point 3 invalid.

I think OP is claiming not to have received it, and the debt agency is claiming OP did receive it!

eddddy

G_M wrote: »

Of course, the longer you hold out, the more the costs will rise if you lose, so it's a gamble on what to do

The way to avoid this is to make a payment 'under protest' - it is important to tell the freeholder that you are making it under protest, and that you do not agree that the charge is due.

As long as you do that, you can then challenge the fee at a tribunal.

The tribunal fee for a simple case is £100 - but the tribunal should order the freeholder to pay the fee if you win.

straas

eddddy wrote: »

So you're saying...

1. You received a correct demand for GR (including the summary of rights) - but you didn't pay.

2. You received a demand for a late fee - did this include a summary of rights? And you didn't pay.

3. You have now received a demand for an even larger late fee - which didn't include a summary of rights.

A key question is whether you received a summary of rights with the demand at point 2. If you didn't, that definitely seems to make the demand at point 3 invalid.

I received the summary of rights with the ground rent.

I didn't receive a summary of rights with the 'demand' for administration fees.

The collection company claim that the administration fee was added after a reminder was issued, and that as the reminder letter said I would be liable for the £60 charge - they weren't required to send a demand for the administration charge - is that correct?

eddddy

straas wrote: »

I received the summary of rights with the ground rent.

I didn't receive a summary of rights with the 'demand' for administration fees.

The collection company claim that the administration fee was added after a reminder was issued, and that as the reminder letter said I would be liable for the £60 charge - they weren't required to send a demand for the administration charge - is that correct?

No - that isn't correct.

They can send you a reminder letter - and they can charge you a (reasonable) administration fee for sending you that reminder letter.

But that administration fee isn't due until it is properly demanded (with a summary of rights).


BUT... Is the latest £400 fee for

a) failure to pay the ground rent, or
b) failure to pay the £60 late fee.

As you know, the ground rent was correctly demanded - but it sounds like the late fee was not.

straas

Breakdown is:

£4 ground rent

£60 administration fee

£120 referral fee

£192 instruction fee

£10 land registry search

straas

This is the reply I received by email from the debt collection agency:

"I am stating that the administration fee applied to your account was applied following the issuance of a reminder letter to yourself. This was followed by a second reminder letter informing you that this fee has been applied to your account and informing you that you would be liable for a referral fee and any fees incurred by our company. An administration fee was applied in regards to non-payment of arrears. A demand was not issued for the late payment fee that is listed as an administration fee on your statement, however you were made aware that this would be applied to your account.



Landmark collections are not obliged to invoice you for late payment fees they have applied, only for the original ground rent arrears you have accrued."