Continual Complaints & Non-Payment of Service Charges

Davesnave

I’m asking this on behalf of some friends, currently on the management committee of a small rural property complex comprising of 14 freehold homes. The committee is responsible for managing shared areas and the provision of services, like grounds maintenance and septic tank emptying.

All residents, except one couple, are happy enough with the way things are being run, but the latter have fallen seriously behind with service charges and have racked-up a shortfall of over £1600. Every request that they pay into the management fund is met with rudeness and multi-page letters, accusing the committee of mismanagement. An example of this is that passing tractors on the private RoW have made their house damp!

They have also threatened to report one friend for engaging in Air B&B and teaching a few private pupils for an hour each per week.

I realise these aren’t things that would seriously trouble hardy members of this forum, but for the two individuals concerned, one of whom is a pensioner, the relentless barrage of complaints, rudeness and continued non-payment have led to personal upset and a desire to quit the management team. However it’s only a small community, so if they employ a company to manage, costs will rise significantly for everyone.

I’ve suggested that there is a mental health issue here as this pattern of aggression and complaint has been consistent over the 10 years I’ve lived nearby. Rumour has it that the couple have an ASBO, but I cannot verify that.

My advice has been to ignore further letters, seek legal help, issue a final demand for payment and follow through in the courts if needs be, but I have no idea what that might cost.

Apparently one member of the committee has suggested using a ‘no fee’ debt collection agency, which is something I know nothing about, but I know nothing’s free!

Any advice from those of you with management committee experience would be very welcome. I’m out of my depth about correct procedures, but I expect there are some and that the awkward couple will know exactly what they are.

Many thanks.

daveyjp

The problem of self management in one thread.

Fine if everyone agrees, a nightmare when they don't. It's why my mum in law's block is now managed by a third party company. One new resident who didn't want to play ball and an ageing management group who didn't want the hassle.

Issues mentioned are not grounds to refuse to pay the service charge. They are diversionary tactics to avoid paying anything. Sort these (not that you will) and there will be something else.

I would seriously consider outsourcing, a few extra pounds a year are worth it for better mental health.

If you don't you need to go full legal which could in any event "cost residents a significant amount of money".

NeilCr

Think your advice is pretty sound Dave

I think they need legal advice so a solicitor can see the documentation involved. I am guessing there are covenants that the couple who won't pay are talking about - not letting out house possibly and not running a business etc.

We have freehold houses on our estate and we (or our MA rather) send two "warning" letters, then a solicitor's letter and then go down the legal route. We've only had to go all the way once and that resulted in a charge on the house

I very much agree with daveyjp about employing an MA. Well worth the extra money for peace of mind and professional help and advice with situations like this

bouicca21

I think the advice is good. As for the ‘business use’ for Airbnb and teaching private pupils, it depends on what the leases say. Do they actually prohibit subletting? Is the entirety of the premises sub let and for what proportion of the year? If it is only part of the premises how is that different to having lodgers? How many pupils and how often?

I can see circumstances in which the Airbnb thing could be deemed a business, but if it’s only occasional or just renting a room, then it would be difficult to classify it as a business. The private pupils seem far less likely to be deemed a business.

I doubt there is a definition of running a business from home that doesn’t involve being liable for business rates and maybe potential capital gains tax. It may also be that the freeholder can legitimately give permission to do whatever these people are doing to earn a few extra quid.

Unless your characterisation of the misery guts is way off beam I see no point in pandering to them. A warning shot and off to court.

princeofpounds

Hi. Firstly, you have to separate in your mind the service charge issues, and the threats and complaints they fling back.

Many of the things you highlight have no relevance to the service charge situation. I would avoid engaging with them on these issues unless you think they pose a specific problem for you. Indeed it is the duty of the management company to collect service charges and maintain the common areas regardless of these side issues that could cause problems for individual members of the committee in their private individual capacity.

Their issues with the tuition and airbnb may be related to covenants that exist on the development. It's unlikely, although not impossible, that they are the beneficiaries of these covenants, so they cannot enforce them.

Then they could be related to council regulatory issues (planning permission, business rates etc.). Of course things should be above-board, but if there is no nuisance caused and no material change of use (such as exclusive business areas) then it's unlikely the council would be bothered.

Of course it sounds like there is more than this, but we would need details to understand and that would get you sidetracked.

As for recovering the service charge. You basically have three options.

1) Negotiation - not going anywhere, clearly

2) Paper demands and threats of legal action - this is basically all debt collectors do before legal action. I don't see why you would employ one, unless you think a third party would change the psychology here. You'd also have to be careful over exactly what you are signing up to.

3) Legal action - It's the right way to go, but it may be unsatisfactory in some respects. It will involve a trip to court (probably two if you need to enforce an order), it will involve legal costs, it will involve time.

You will win, but recovery of costs and the effort involved in achieving a judgment and then enforcement may make it feel like you haven't.

Hiring a specialist lawyer to write a final demand is probably worthwhile, because you will have had to follow proper procedures before launching a case, otherwise the courts may send you back to square one. Then a letter before action. Then you have to decide whether to actually take them to court.

But it's worth not letting it drag, because if you don't go down this path, the problems will just mount up. It won't get better. And the sooner you start, the sooner it gets finished.

Davesnave

Many thanks for all the helpful advice above. I will type out all the main points made, present it to the lady who brought the matter to me and get her to check matters like covenants etc, which I've no knowledge of.


I totally agree that a managing agent ought to be appointed.


I'll probably stay at a safe distance. Our property isn't part of the development; it just borders on it and we share a private road. We have a good relationship with the other residents.


However, my wife and I have had a couple of complaints from the awkward pair, both of which were straightforward to deal with. Since then we've had peace, and I'm keen to keep things that way!