Communal Electricity Bill

IMC2
IMC2 Posts: 17
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I was wondering if anyone has had a similar experience to myself.

Recent bought a flat. My service charge (which is fixed) is what is supposed to pay our communal electricity bill. The owners have recently received an electricity bill for £18k to be divided between us. Now from what we know this bill has been outstanding and growing for quite some time, mainly due to Eon sending letter's to one of my neighbours threatening to turn the power off, over a period of 6 months. We are under the impression that the last building owner wasn't paying for the electricity and when they sold it to the new building owner, the bill has been passed to them. Who have also not been paying it. It was highlighted that the flat owners knew about the bill, however the property managernever really addressed it, and told us not to worry. Now, they have now passed this bill onto us.

I suppose my question is, where do we stand with paying this? Technically we have paid the money. At no point did the current building owners address the bill when it was at £10k 6 months ago. So they have let it build up. Plus we know from the letters that interest has been added, which, again, isn't our fault as we paid our service charges on time, as agreed? We're all refusing to pay but struggling to get any answers as to how this is dealt with. Plus the property manager won't address our concerns or answer our questions. They just keep sending outstanding arrears letters.

Secondly period that the property manager claimed the bill has built up is over 18months. I've only lived for 6 months. I've seen mixed things on the Internet saying this debt would be passed onto me, some articles saying I'm not responsible. But the previous owner probably wasn't aware of this.

I'll apologise for the spelling and grammar mistakes now, but any help or advice would be greatly appreciated. 

Comments

  • Liability will depend on the exact wording in your contract. 

    If you are comfortable sharing the relevant section of your contract here, we can help interpret, but this is the kind of thing (and amount) that might warrant some legal advice, especially if one of the residents has legal cover included in an insurance product or you can split the costs.  
    I'm not an early bird or a night owl; I’m some form of permanently exhausted pigeon.
  • Jonboy_1984
    Jonboy_1984 Posts: 1,191
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    Generally you should not withhold service charges as doing so puts your lease at risk of being ended.

    You should pay the demand under protest, I.e. Pay it and send a letter to the management agent stating it has been paid under protest because you disagree with xyz. 

    For the period before you owned the lease, you are responsible for paying the management agent and should then normally* seek refunding from whoever sold the property to you.
    This may be via a retention if one was agreed as part of the sale (this is a cash sum retained by the sellers solicitor and only passed over to them once the service charge year was finalised and any over/under payment corrected) or you might need to ask your solicitor to approach them for a payment now. 

    * in rare circumstances a sale might have been agreed with no right to collect any balance, but your solicitors should have spelt that out to you.


    Finally you mention the service charge as fixed, that would be highly unusual as the exact costs in any one year are not known as all sorts can crop up within the year such as vandalism, flytipping, uninsured damage, or things such as cleaning contractors going bust and new provider being more expensive.
    For most modern leases an estimate is made at the start of the financial year for the year ahead and the main service charge is requested from all leaseholders to ensure cash is there to pay the costs as they arise. At the end of the year the accounts are finalised and a balancing demand or credit is issued. (Some older leases are paid in arrears).

    Major repair projects would fall outside this via a section 20 process. 
  • Generally you should not withhold service charges as doing so puts your lease at risk of being ended.

    You should pay the demand under protest, I.e. Pay it and send a letter to the management agent stating it has been paid under protest because you disagree with xyz. 
    I agree with paying the contactual service charge - but this (from what's written) is a separate bill that they've been presented with for backdated utility charges that's outside the framework of the contract. 

    If that's the case, I would not recommend paying as the first step is to establish liability for the debt... 
    I'm not an early bird or a night owl; I’m some form of permanently exhausted pigeon.
  • Jonboy_1984
    Jonboy_1984 Posts: 1,191
    First Post First Anniversary Name Dropper Combo Breaker
    Forumite
    Generally you should not withhold service charges as doing so puts your lease at risk of being ended.

    You should pay the demand under protest, I.e. Pay it and send a letter to the management agent stating it has been paid under protest because you disagree with xyz. 
    I agree with paying the contactual service charge - but this (from what's written) is a separate bill that they've been presented with for backdated utility charges that's outside the framework of the contract. 

    If that's the case, I would not recommend paying as the first step is to establish liability for the debt... 
    It has been presented by the management agent, and so is the same as any other part of the service charge, and so OP needs to play by the service charge rules and set themselves up to be able to dispute at tribunal if required. 
  • Generally you should not withhold service charges as doing so puts your lease at risk of being ended.

    You should pay the demand under protest, I.e. Pay it and send a letter to the management agent stating it has been paid under protest because you disagree with xyz. 
    I agree with paying the contactual service charge - but this (from what's written) is a separate bill that they've been presented with for backdated utility charges that's outside the framework of the contract. 

    If that's the case, I would not recommend paying as the first step is to establish liability for the debt... 
    It has been presented by the management agent, and so is the same as any other part of the service charge, and so OP needs to play by the service charge rules and set themselves up to be able to dispute at tribunal if required. 
    Thank you - I think I might be getting stuck on the language in the OP saying the bill has been 'passed on' to them and that Eon were writing directly to a neighbour... re reading I can see it's the management company wanting to be paid so they can pay the bill (at least I think...) 
    I'm not an early bird or a night owl; I’m some form of permanently exhausted pigeon.
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