Service Charge Fees

tightauldgit

RefluentBeans said:

user1977 said:

RefluentBeans said:

I may be overthinking this - but surely going from a payment for services that have been delivered to payment before services delivered represents a material change in contract. Surely this should allow for termination (or at least renegotiation) of the contract

It would be pretty normal to pay in advance in this sort of scenario, rather than expect the management company to be running an overdraft (which ultimately would be at your expense anyway...).

My point being as the payment terms have changed now, that is a material change in terms of the contract. They can give all sorts of reasons for it, but any material change in contract surely can’t be decided purely by 1 party with the other party having no chance to agree or disagree? 

I'm not really sure - typically there's just something in the deeds that says something along the lines of 'you'll pay the management fees' and no real 'contract' beyond that. There's probably some outline service level agreement somewhere but that's not a contract with the residents I don't believe. I was in one of these deals in my old property in Scotland and there didn't really seem to be many options beyond 'pay up and shut up'. I'm not even sure to what extent you can challenge them for not doing the work since the service provided seems to be entirely at the discretion of the landowner (who are often the management company) and not the residents. If they are charging for things that aren't done it might be different but if they just decide cutting the grass means once a year instead of once a month then I'm nor sure what if any comeback there is. It definitely seems like a system ripe for abuse. 

eddddy

RefluentBeans said:

My point being as the payment terms have changed now, that is a material change in terms of the contract. They can give all sorts of reasons for it, but any material change in contract surely can’t be decided purely by 1 party with the other party having no chance to agree or disagree? 

It's extremely likely that the contract (i.e. the lease or deed) has always allowed the management company to charge in advance.

Any sensible developer / freeholder / management co would structure their leases/deeds in that way.  (Although there might be some really old leases - maybe 100 years old - which don't allow payment in advance.)

But the OP should read their lease/deed - just to make sure.


I think it's more likely that the management company were just being sloppy with their billing in the past. For example...

• The lease/deed says that a 6 monthly advance management charge is payable on 1st Jan...

• ... but the management company didn't get round to sending out bills until June

But now the management company have got their act together.