Property Management Company - Disputing Service Charges

Daisyboo123

When I bought my house on a Persimmon Development 5 years ago - all those buying had to sign a contract with a property management company to maintain a communal area of land on the development. We signed for 18 visits p.a, in those 5 years - the annual service charge has increased by almost 50% with maintenance work virtually non existent. I am aware that there is protection for leaseholders and tenants to dispute ever increasing service charges, but does anyone know if the same applies if you are freehold? I and the majority of residents would like to end the contract with the management company too!Any advice would be greatly appreciated! Thanks

eddddy

Daisyboo123 wrote: »

all those buying had to sign a contract with a property management company to maintain a communal area of land on the development.

Standard contract law applies.

All parties have to abide by whatever terms the contract says. So if the management company are breaching any terms in the contract, you can take action against them.

As you suggest, there is currently no additional protection for freeholders, apart from contract law.


The residents can try negotiating with the land owner to see if they will sell you the land, or allow you to manage it. But you cannot force them to.

Daisyboo123

Thanks for your response. I contacted the Wales Property Tribunal who initially said that we as Freeholders could dispute the service charges – and we submitted a LVT6 Form under the auspices of the Landlord and Tenant Act 1985 - Section 27A and (S19) – Application for the a determination as to liability to pay and reasonableness of variable service charges.
However, the Management Company believe that as we are freeholders our application is not within Wales Residential Property Tribunal jurisdiction to consider.
However whilst my TP1 makes note of the covenants in relation to the Property Management Company the accompanying plan clearly shows that I am a freehold owner of my property only. The privately managed (communal) area is separate and owned by the house developer, as this was not adopted by the local council. There is a Property Management Company in place to oversee and maintain the privately managed (communal) area and residents pay the Property Management Company an annual service charge.
If we are deemed freeholders, in respect of the service charges we pay, why then have the annual service charges from the Property Management Company since 2017 accompanied by a document - ‘Service Charges/Administration Charges– Summary of tenant’s rights and obligations’. It is a summary document which sets out the rights and obligations in relation to variable service charges ….The provisions of which are set out in Section 21B of the Landlord and Tenant Act 1985 inserted by Section 153 of the Commonhold and Leasehold Reform Act 2002 and the Commonhold and Leasehold Reform Act 2002, in Section 158 and Schedule 11(4)(1). Effectively a Landlord and Tenant relationship.
It also clearly states that we have the right to ask a leasehold valuation tribunal to determine whether we are liable to pay service charges for services, repairs, maintenance, insurance or management.
I would maintain therefore, that the Wales Property Tribunal do have the jurisdiction to consider our application, but am finding it all a bit of minefield. Am guessing I may need to consult a solicitor?