JB Leitch LBA - Demonstrated intent to pay - Centrick

Maia1111

Hi I am looking for some guidance / Insight 

I am a leaseholder. I got myself into arrears after the tragic passing of my brother in 2022. Around £3000 Service Charges mostly. But still paid a monthly amount that i agreed with the managing agent which they accepted (i believe there is something in leasehold law that states that if they accept it, it means they agree to it?) 

Here are the sequence of events that occurred, and the guidance i am seeking is below that.

July/August 2023: Receipt of initial communication from Centrick via a casual email with invoice attached, regarding outstanding Service Charge and Heating Recharge arrears, totaling an estimated £3000. In response, I promptly communicated my financial hardship and the emotional toll of recent events, expressing a willingness to address the arrears given some time.

August 2023: Centrick responded via email, granting an 8-week period to find a solution.

20 October 2023: Following the prescribed period, I provided in formal writing via email comprehensive documentation detailing my efforts to secure funds, including energy grants, mortgage payment arrangements, and hardship funding applications. To which I sought clarification on the origin of certain arrears as they were missing dates and I could not clarify the amount, to which no response was received.

22 December 2023: An unprecedented intervention occurred when my Mortgage Provider informed me of communication from Centrick, indicating arrears totaling approximately £4,537.58. This development prompted further inquiry into the discrepancies as I was unaware of the additional amount that led to this total in arrears or even that it was possible that my managing agent could write to my mortgage provider like this.

2 January 2024: Off the back of the correspondence received from my mortgage lender on 22 Dec 2023. A formal complaint letter was sent to Centrick and E&J Estates by myself, adhering to TPO regulations and internal complaints procedures requesting another clarification of some of the arrears. It was escalated to Centrick  Head of Client Services, who responded on 3 Jan 2024, and advised that she would respond within 15 days to my complaint. Despite the regulatory obligation to respond within 8 weeks, no reply was forthcoming to date. And it was on the basis of her response that I was waiting to instruct my Mortgage Lender to make the payment to Centrick once I received the clarification of some of the arrears. To which I never ever received to date.

25 April 2024: The recent receipt of the LBA marks the latest development in this protracted saga. Notably, the letter demands payment of arrears, accompanied by escalated legal fees to the value of £2500, raising concerns regarding procedural fairness and competence in managing the leasehold affairs.

NEW IMPORTANT INFORMATION RECEIVED:

1.     On 29 April 2024 3pm, I decided to contact my Mortgage Provider for the 2nd time in a few days. They advised that the original letter the received for demand for payment was from JB Leitch dated incorrectly by them 4 Dec 2022 (Correct date 4 Dec 2023). My Mortgage Lender scanned this letter onto their systems on 11th Dec 2023. The cannot send me a copy of this letter. But it states something to the following, ‘No dispute that she cannot afford to make this payment, and therefore we need to demand this payment from you’ Demanding payment by 18th December 2023. The letter from JB Leitch outlined the following charges - Arrears £3037.58  Legal Charges £1500 – TOTAL £4537.58

2.     On 29 April 2024 3pm the 2nd piece of vital evidence that my mortgage lender Agent shared is that on the 15 December 2023, my mortgage lender sent a letter to JB Leitch, to the effect of:

‘Thank you for your letter. Please supply evidence of the legal obligations (for Santander and Myself as a Leaseholder). Also provide evidence of court proceedings.

To date my mortgage lender have not received a response from JB Leitch. As advised by my mortgage lender they do not see this as a threat due to the no response from them.

I have a good and strong relationship with my mortgage lender, and they have advised that until they receive the legal evidence, they will not action anything. They too have noted discrepancies correspondence from JB Leitch and their conduct.

I have to respond by the deadline 9 May 2024. 

Questions

1. I do not want to pay the legal fees they are not justified. Centrick have been unresponsive to my requests, informally and formally. Are there strong grounds that i can not pay the legal fees here? 

2. Someone in my complex had appointed a solicitor and i believe once a letter was sent to JB Leitch requesting clarification on arrears, JB Leitch never responded (Just as they didnt respond to my mortgage lender). By which time the leaseholder had already paid the arrears. Could i approach Centrick directly and just pay off the arrears (are there any implications to this especially as they have representation) 

3. I was thinking of appointing a solicitor but the cost is not affordable, and therefore i am thinking of responding myself to them, any guidance of what i should include based on leasehold law and above information (I have done some research and understand that i can send a letter of response

4. In the LBA they state that there is an admission form enclosed in the documentation and asked me to complete it and send it to them. It was a form that they would send to my lender. So the day after i received my LBA i responded to them and asked them to send me the admission form that they mention in the letter so that i can complete it. 1st may they sent me an email with the attachment that was pre-populated with all the freeholders details and then they advised that i would have to foot an additional charge of £715 for this! Yet it was not included in their legal cost, it was not mentioned anywhere in the letter. This was underhanded and really snaky. 

I recently lost my little brother and Centrick are aware of my financial challenges and emotional state. I have showed intent to pay, i have simply asked for clarification on some of the arrears which i do not recognise but they have not responded to that on 2 occasions. So my emotional state wants to deal with this and be done with it. BUt my logical mind wants to take a stand. 

Thank you 

eddddy

Whenever possible, the advice is to pay whatever charges the freeholder/management company is asking for - but say that you are paying under protest.

That will stop further legal costs etc being added.

And you can then take your time to prepare a challenge to the fees, and apply to a tribunal to make the challenge (and maybe get some of the charges refunded).


But in your case, it sounds like you don't have the money to pay the charges, but potentially your mortgage lender might pay. So again, once they pay, no further charges can be added.


BUT... an "Admission Form" sounds like it's form saying "I admit that I owe all the money that the freeholder/management company are asking for".

If you sign a form like that:

• You won't be able to challenge the fees at tribunal

• It makes it easier for the freeholder to forfeit your lease (i.e. repossess your flat)

So ideally, you want to say to Santander...

• Please pay all the money that the freeholder/management company is asking for

• But I won't sign an "Admission Form"

• I and/or you will say it's being paid under protest
  

• I will later challenge it at tribunal

But I don't know if Santander would agree to pay on that basis.

Maia1111

@eddddy thank you this is really useful to know.. luckily i have not signed an admission form on that basis yet. However I am in discussions with Santander. I will keep this thread updated so that it will help others too. 

Maia1111

Hi Everyone 
So i had appointed a Solicitor through a platform called Lawhive, but they appointed a Litigation Solicitor. They have not to date prepared a response and it has been a nightmare with them. Today 30 May i have received a letter via email from JB Leitch negotiating the legal fees down to £2000 inc VAT. They have attached the admission form. 
They have also advised that the freeholder will not go any further down with this amount. If i do not accept they would begin court proceedings which would accumilate to the value of £30K. Had lawhive have responded within a timely manner and appointed a leasehold solicitor i will not be facing this. So i am considering now to respond and agree to this. However i believe they have attached an admission form. i had some questions; 

1. If i signed the admission form agreeing to the amount, does this mean i cannot challenge it further down the line through a tribunal? (Could i challenge through other channels such as the TPO as Centrick did not respond)? 

2. Does this admission form mean that its in complete isolation for this instance and not for any future arrears that may come up (I dont see this happening, but we do receive unexpected bills that come out of the woodworks from 2-3 years prior)

3. There is a sentence in there that states 'This letter does not waiver our client's right to forfeit the lease; In laymans terms what does this mean? That once i sign the admission form they can forfeit the lease? I imagine once my mortgage provider pays the arrears, the lease cannot be forfeited? When can they forfeit the lease, and what actually happens when this occurs eg do they send a letter to the mortgage provider or a demand what does this look like. 

I have contacted Santander asking if they would pay it without the threat of an S146, and its likely they wont, but i have not put it in writing to them and maybe i should. They advised they would only pay it if the security of the property was at risk. 

The deadline for this is 5 June so any prompt responses would be much appreciated. 
Thank you

eddddy

This is serious stuff - you really need advice from a specialist leasehold solicitor (rather than random strangers on the internet), but...

Maia1111 said:

1. If i signed the admission form agreeing to the amount, does this mean i cannot challenge it further down the line through a tribunal? (Could i challenge through other channels such as the TPO as Centrick did not respond)? 

Yes - I strongly suspect that signing an admission form means you can't challenge it at a tribunal.

If you sign the form, are you able to pay the £2k legal fees plus outstanding service charges?

If you sign but can't pay, does the form say what will happen? Will they issue a s146 notice? And will they start adding more legal fees again?

i.e. Is the form essentially saying "We will cap all our legal costs so far at £2k - but if you don't pay, we'll start adding new legal costs."

Maybe ask Santander if they have any objection to you signing the form.

If you mean The Property Ombudsman, they don't deal with Service Charge disputes.

Maia1111 said:

3. There is a sentence in there that states 'This letter does not waiver our client's right to forfeit the lease; In laymans terms what does this mean? 

It means the freeholder can still forfeit your lease.

Maia1111

@eddddy thank you! 

I spoke to Santander and they state that their legal team and their policy is that until they receive a 'threat to the security of the property' such as a Section 146, they will not pay it. But when they receive the threat, they will contact me and send me an authority form (This is effectively asking for my permission to put the outstanding amount onto my mortgage). Whether i sign it, or do not sign it, Santander within 14 days of sending me that authority letter will pay the amount and put it onto my mortgage. I did however ask Santander that i would be paying under duress, as JB Leitch clearly state in their correspondence in so many words that i accept the new proposal which they deem reasonable, otherwise their client (my freeholder) has advised they can take court action without providing me with any notice to which the legal costs would be within the region of £25-30K. So it feels like i am forced to take the one and only option, without any clarification of my arrears.

So i advised my mortgage provider that i would complete the admission form from JB Leitch under duress attaching a letter from my GP, and that i may decide not to sign their authority form. They reassured me that the amount would still be paid whether i sign the authority form or not. Effectively Santander's authority form is 'asking for my permission'. And realistically i am not giving my permission, because its under duress.  I will be talking to the lease advisory tomorrow (1st June ) and will take advice from them to finalise my decision and manage any risks that they may highlight. 

To clarify- A Admission form from JB Leitch is 'admitting to the arrears and legal costs' meaning we cannot protest it (I see this has been mentioned in the trail too)

Authority form- This would come from Santander to me in the post by way of them asking my permission to put that amount onto my mortgage once they receive the 'threat of a section 146' from JB Leitch.

i am only just getting on my feet financially and do not have that money readily available. and therefore would agree to the arrears going onto my mortgage, however now have to accept the legal costs to goon too. This will increase my monthly mortgage amount by £40 taking it to £480 per month, that is substantial and scary for me given i only work freelance. My mortgage provider has been very supportive and they absolutely know what they are doing in such matters 

After lots of reading i believe as long as the arrears & legal fees are paid they cannot forfeit the lease, and they cannot keep whacking on legal costs provided i sign the admission form and send it back by 6 June 2024 which the newly proposed amount for legal costs. . 

JB Leitch's 2nd letter dated 30 May is actually in response to my letter that i sent on their LBA letter deadline of the 9 May. I had explained that i do not deem the legal costs as reasonable given my attempts to get clarification of my arrears and also provided evidence and had no response on 5 occasions from Centrick. At the end of the letter i had sent on 9 May i had stated that my solicitor will be in touch to act in my best interests, but they never received a letter from my solicitor, which was meant to be from lawhive. 

So for the sake of my own mental health and closing off the matter i am seriously considering accepting the financial loss, but TPO can be involved not from a service charge dispute perspective, but from the perspective of aggravation, inconvenience, misconduct, financial loss and incompetence perspective. What i would highlight to them is the 5 times that i contacted Centrick requesting this information, and they never ever provided it, 2 attempts of which were formal complaints procedure. TPO see my investigation as absolutely valid to raise with them. 

I am also going to The Independent Newspaper and the local MP in regards to this horrific conduct by Centrick. And with lawhive i intend to report them to SRA and also raise a formal complaint there, and request compensation for similar reasons, aggravation, misconduct, inconvenience and financial loss. I will also be contacting the LKB who deal with such matters. 

Unless by some miracle I have a windfall of money before the 6 June 2024, the only route is to accept their new proposal to go onto my mortgage. I am open to any other suggestions, or anything i may have missed. 

Thank you in advance.