Being chased for a statute-barred debt by Property Debt Collection Ltd for Moreland / MW Freeholds

eddddy

ripofflondon said:

And is it normal for them not to even specify whether I'm supposed to defend it in the County Court or the Land Tribunal?  

You absolutely don't want them to take you to court (or tribunal) unless you are 100% sure you will win every aspect of the case.

They might spend thousands of pounds on solicitors fees, which could be added to your bill - if you don't win.

So as I mentioned, the standard advice is...

• Pay whatever the management company is asking for (however outrageous you think it is) - but say you are paying under protest

• Then challenge the bill at a tribunal

You can book a free 15 minute phone call wit the Leasehold Advisory Service to confirm this. (They are a government funded agency that advise leaseholders) . See: https://clients.lease-advice.org/#/

eddddy

ripofflondon said:

Is all this paperwork requiring someone to bare their financial soul normal? 

That's in case you're going to say...

 "I agree I owe this money, but I can't afford to pay it"

So they would use your financial info work out a reasonable monthly payment.

 But you're not going to say that, so you can ignore it.

eddddy

ripofflondon said:

in response to this point of yours see the latest 'Application For Payment' dated 23 Feb - almost looks like the 2 cos aren't talking to each other, doesn't it?  

I'm not sure what point you're making.

At a glance, the line items seem to be the same on both 'Applications for Payment' - except that the later one includes 'interest' and debt collection fees from PDC.

If you think that the interest charge is unreasonable, or the debt collection fee is unreasonable - you should still pay them, and then challenge them at tribunal.

ripofflondon said:

 

In case not already pointed out:  I can confirm that the RTM company took effect on 7 June 2016 and that I had ended up in about 1 year's worth of service charge arrears, having been emailing Moreland repeatedly for clarification of how they were arrived at and what work had been taking place (the fire alarms were out of action for months if not a whole year prior to June 2016) but had been met with a deafening silence.

Again, I'm not quite sure what points you're making...

• Why does the fact that the RTM company took effect on 7 June 2016 make Moorland's service charges unreasonable?

• Why does the fire alarms being out of action make Moorland's service charges unreasonable?

It's bad that Moorland didn't give you the clarification you asked for - but I'm not sure that a Tribunal would say that's a good enough reason not to pay your service charges.

ripofflondon

eddddy said:

You absolutely don't want them to take you to court (or tribunal) unless you are 100% sure you will win every aspect of the case.

They might spend thousands of pounds on solicitors fees, which could be added to your bill - if you don't win.

I don't know about the Land Tribunal but I thought for a small claim in the County Court (up to £10,000) each party was liable for their own legal costs regardless of who wins or loses? 

Leasehold Advisory Service - thanks

ripofflondon

eddddy said:

At a glance, the line items seem to be the same on both 'Applications for Payment' - except that the later one includes 'interest' and debt collection fees from PDC.

There 'was 1 'Application for Payment' for £1092.18 and it came from Moreland dated 23 Feb. 

The 2 letters that came from Property Debt Collection dated 19 Feb for £1984.18 and 27 Feb for £2,058.61 both had interest (for differing amounts) while the 27 Feb one had the £72 PDC Trace Fee.  

ripofflondon

eddddy said:

Again, I'm not quite sure what points you're making...

• Why does the fact that the RTM company took effect on 7 June 2016 make Moorland's service charges unreasonable?

It doesn't. just clarifying the dates

• Why does the fire alarms being out of action make Moorland's service charges unreasonable?

They hadn't been doing ANY cleaning / maintenance work in the common areas and had been completely ignoring any requests from us leaseholders for clarification on how their service charges were calculated.  Just about all of us had been withholding payment of said charges as a result.  That is why we exercised our RTM and took over the management ourselves. 

And I would like to think that any court / Land Tribunal would take a rather dim view of a management company breaching the Fire Safety Act (don't know the name of the legislation without looking it up) by not having working fire alarms, which is itself a criminal offence

eddddy

ripofflondon said:

eddddy said:

You absolutely don't want them to take you to court (or tribunal) unless you are 100% sure you will win every aspect of the case.

They might spend thousands of pounds on solicitors fees, which could be added to your bill - if you don't win.

I don't know about the Land Tribunal but I thought for a small claim in the County Court (up to £10,000) each party was liable for their own legal costs regardless of who wins or loses? 

No - these costs are nothing to do with the county court or  the First Tier Tribunal (FTT). 

These legal costs (and other costs), if legitimate, would be payable whether you go to court or not.

The relevant legislation is "The Commonhold and Leasehold Reform act 2002".  



In simple terms....

• Moorfield are saying that you breached a covenant in your lease by failing to pay your service charge

• The Commonhold and Leasehold Reform act says that you have to pay Moorfield any costs they incur resulting from your breach of the lease

• In this case, costs they incur might include...
•      The cost of preparing and sending you letters relating to your breach
•      The cost of time spent by their employees relating to your breach
•      The cost of debt collection resulting from your breach
•      The cost of legal advice resulting from your breach
•      The cost of preparing a court case against you resulting from your breach

BUT... there might be a question mark about whether interest is payable.

Most leases say that interest is payable on overdue service charges. If your lease says that, then you've contractually agreed to pay interest on overdue charges.

If your lease doesn't say that interest is payable, then the FTT has the option to add interest, but I suspect they wouldn't. 



You need to look at Section 158 and schedule 11 of the The Commonhold and Leasehold Reform act

https://www.legislation.gov.uk/ukpga/2002/15/section/158
https://www.legislation.gov.uk/ukpga/2002/15/schedule/11

https://www.lease-advice.org/lease-glossary/administration-charge/


Depending on the structure of your lease, Moorfield are charging you as a result of either 1(c) or 1(d) below

Meaning of “administration charge”

1(1)In this Part of this Schedule “administration charge” means an amount payable by a tenant of a dwelling as part of or in addition to the rent which is payable, directly or indirectly—

(a)for or in connection with the grant of approvals under his lease, or applications for such approvals,

(b)for or in connection with the provision of information or documents by or on behalf of the landlord or a person who is party to his lease otherwise than as landlord or tenant,

(c)in respect of a failure by the tenant to make a payment by the due date to the landlord or a person who is party to his lease otherwise than as landlord or tenant, or

(d)in connection with a breach (or alleged breach) of a covenant or condition in his lease.

Link: https://www.legislation.gov.uk/ukpga/2002/15/schedule/11

ripofflondon

Thanks for your time, Eddddy.  

Am wondering about paying the amount shown on the ''Application for Payment' to Moreland direct - if I did that (and stated it was under dispute) would that extinguish the right of PDC to come after me? 

I have documentary evidence of how I (and the other leaseholders) sought clarification re the service charge and never got any response.  

eddddy

ripofflondon said:

They hadn't been doing ANY cleaning / maintenance work in the common areas...

So you needed to do a forensic analysis...

For example,

• How many hours a week were the cleaning contractors paid for?
• What was the hourly rate?
• How many hours did they turn up for?

For example,

• you might have found that the cleaners were being paid £200 per week for 2 hours work. If so, you could argue that's unreasonable. Maybe £50 per week would be more reasonable.

• Or if the cleaners weren't turning up and/or only doing 30 mins instead of 2 hours - did somebody report that to the management co. If nobody told them, they probably wouldn't know.

ripofflondon said:

...had been completely ignoring any requests from us leaseholders for clarification on how their service charges were calculated.  Just about all of us had been withholding payment of said charges as a result. 

The tribunal might have a bit of sympathy, if your requests for service charge breakdowns were ignored.

But if you had asked any professional familiar with leasehold law, they would have told you not to withhold service charges.



For example, Shelter say:

Consider the timing of a challenge

It is common for a lease to include a clause that allows a landlord to recover costs in connection with the enforcement of the terms of the lease. To avoid liability for such costs it could be advisable for a leaseholder to pay a disputed service charge and then to challenge the validity of the amount charged in the First-tier Tribunal (Property Chamber).

Link: https://england.shelter.org.uk/professional_resources/legal/home_ownership/service_charges/challenging_service_charges_for_leasehold_properties

ripofflondon

eddddy said:

You can book a free 15 minute phone call wit the Leasehold Advisory Service to confirm this. (They are a government funded agency that advise leaseholders) . See: https://clients.lease-advice.org/#/

Dear oh dear, just looked on the Leasehold Advisory Service website and the earliest date available for is 10 April, Thursday