Renting: Bill Vs Service charge

Amy_Dorman

Hello, hoping to get guidance and advice on a complex billing issue we are having in our rented apartment.
Situation: We are renting a new build flat, the hot water is in a communal tank and when we moved in we were told that we were NOT responsible for the cost of heating the water and our estate agents made this clear that we shouldn't worry about this and used this as a selling tool. 
We pay all other bills including the water bill which covers the usage but not the 'heating', we also do not have access to this meter reading. Fast forward 3 years, we are now in disputes with our estate agent and landlord as it transpired that the original agreement between the company who provide the heating service and the building company was incorrect and they haven't been issuing bills correctly. Our estate agents are now asking for us to foot the bill for the last 3 years. When we have received the bills historically, which were addressed to our landlord, we have sent them over to our estate agents who confirmed receipt and told us not to worry. 
We have it in writing from our estate agents that they made a mistake and miscommunicated the situation. They were notified of an issue shortly after we moved in (Jan 2018), whereby the cost/service would not be free but would be rolled up into the service charge (we do not pay this, our landlord does). They failed to tell us of any issues until May/June 2020, when they started to communicate that there was an issue 'brewing'. They only confirmed we would be responsible for costs in August 2020 and expected us to pay the back-dated bills from when we moved in. 
We do not believe we should be liable for the costs having been told explicitly that we were not responsible when signing the contract and them using it as a sales tool in the first place. It has also taken them 2.5 years to tell us there is a problem. Unfortunately our formal tenancy contract states we are liable for all bills, but we do have emails from the estate agent detailing the above errors. We are of course happy to pay these bills moving forward now we are aware. Does anyone know what legal/ethical grounds we have to continue disputing the back dated bills?
Many thanks in advance! 
Amy

knightstyle

What exactly does your contract say about this, plus do you have anything in writing dating back to the start of your tenancy?

princeofpounds

The freeholder will bill the leaseholder (your landlord) for the heating through the service charge. The leaseholder is directly liable for this, there is no argument about that.

The question is whether that liability has been indirectly transferred to you. All that matters from your perspective is what you contracted to regarding this bill with your landlord.

Although that sounds simple, it's not quite that straightforward. One question is what your written contract says. 'Liable for all bills' is your description of it, but not the exact words and it lacks necessary context. You may be liable for all bills, but 'all bills' may not include this bill depending on how it is defined - particularly as the original liability rests with the service charge and not the occupier.

The other question is what undertakings you have been provided with by the LL or agent (and can evidence) that may assist in interpreting the contract. These are good evidence of the intentions behind the contract and may be useful in resolving any ambiguity. So again, what exact communications from the Landlord's agent can you produce? 

Finally, there is a question of how any remaining genuine ambiguity in contracts is dealt with in court. Typically the court would rule in favour of a tenant, as they are not the party that drafted the contract.

Anything the agent says to you is as if it came from the landlord themselves, as an appointed representative. Clearly the original miscommunication was between LL and A.

So it's a bit hard to comment too exactly on your situation as we have seen none of the specific evidence, which is crucially important.

Obviously if you refuse to pay, the LL may well choose not to renew your tenancy when the time comes. 

Amy_Dorman

So this is what our contract states: "Pay a fair proportion of all charges, based on the length of the tenancy, including water and sewerage charges, rates and assessments (but of an annual or recurring nature only) and for all gas, electricity, oil or solid fuel consumed on the Property (including all fixed and standing charges) and all charges for the telephone line and associated services during the Term of this agreement. If the Landlord is held responsible by law for the payment of any of these bills the Tenant agrees to refund to the Landlord the amount covering the Term of this tenancy." 
This is the first piece of communication from our estate agents on the matter from July 2020:
"When people first moved in 2017 I was told that heating and hot water would be part of the service for the building under service charges, but after a while it turned out they had that company Insite doing the billing. Insite didn't manage to get bills into people's names and were deinstructed by Remus the managing agent in November 2019 as they weren't doing the job."
In November 2020, the estate agent followed up with the below:
"When we first took on the building, we were advised that hot water would somehow be included by Bellway Homes' sales staff (not Remus), however it quickly transpired that the charge would join with the service charge being a communal charge. Insite had promised us that bills would be issued in the name of the occupants (as Data Energy now do), but in all the time they were instructed they only managed to do this for two out of twenty properties. Insite are no longer involved and will not respond to further correspondence. The role Insite played however was purely one of reading meters; it is Remus that sets and charges the billing, and Data Energy fulfill the same role of reading the meters to determine the billing for Remus.
The usage pertains specifically to your apartment and usage. While I understand it is not helpful to have a bill in your name for that, it still counts as usage, and the bill was still generated for metered hot water which has to be paid for even if initially it's in the name of the leaseholder."

To paint a wider picture on the situation - the bills equate to over £1000, our contract is up for renewal in January and they have chosen to increase the rent which we've agreed too. We are also midway through buying a house so the contract renewal isn't a huge stress as we hope to complete in Feb/March. If it comes down to it and we have no ground to stand on then we will pay but it just seems extremely misleading and unfair. 
Thanks for your help!

princeofpounds

Thanks Amy. Let's see what people on the board think.

Amy_Dorman said:

 If the Landlord is held responsible by law for the payment of any of these bills the Tenant agrees to refund to the Landlord the amount covering the Term of this tenancy." 

This is probably the most problematic clause for you, as it provides evidence that there was some intention to pass utility bills in the landlord's name on to you. The prior clause isn't particularly clear about hot water as it isn't specifically mentioned, but I'm not sure that can really serve as a get-out clause as I suspect any court would count it as the consumption of the energy sources which are mentioned.

The first communication from the agent doesn't really help you. It does imply they were under some kind of misapprehension about how the billing would work, but it doesn't imply that they told you that you wouldn't have to pay.

The second communication does have more of an implication that the agent was under the misapprehension that the hot water might actually be free (no idea why they thought that, idiots), and so may have passed that erroneous information on to you. But again it's not really the smoking gun you're looking for.

So I'm not confident you would be able to avoid this liability, we'll see what others think. The problem is that the agent told you one thing verbally and you signed a contract that said something else. 

As to how to deal with it... depends how much you want to stay there and want a reference. 

Speedbird676

Amy_Dorman said:

This is the first piece of communication from our estate agents on the matter from July 2020:
"When people first moved in 2017 I was told that heating and hot water would be part of the service for the building under service charges, but after a while it turned out they had that company Insite doing the billing. Insite didn't manage to get bills into people's names and were deinstructed by Remus the managing agent in November 2019 as they weren't doing the job."
In November 2020, the estate agent followed up with the below:
"When we first took on the building, we were advised that hot water would somehow be included by Bellway Homes' sales staff (not Remus), however it quickly transpired that the charge would join with the service charge being a communal charge. Insite had promised us that bills would be issued in the name of the occupants (as Data Energy now do), but in all the time they were instructed they only managed to do this for two out of twenty properties. Insite are no longer involved and will not respond to further correspondence. The role Insite played however was purely one of reading meters; it is Remus that sets and charges the billing, and Data Energy fulfill the same role of reading the meters to determine the billing for Remus.
The usage pertains specifically to your apartment and usage. While I understand it is not helpful to have a bill in your name for that, it still counts as usage, and the bill was still generated for metered hot water which has to be paid for even if initially it's in the name of the leaseholder."

Both of these quotes are from 2020. Do you have anything in writing, aside from what is in the contract, from when you moved in?

Amy_Dorman

@Speedbird676 Unfortunately nothing in writing prior to this as we wasn't aware of any problems until now. That's the difficulty, the estate agents have known there was an issues for years and not said anything and now we've been lumped with a huge bill. I think it is looking more likely we will have to pay it and lesson learnt for future!