Monday, 22 December 2014

Retaining my service charge payments for over a year

Posted in: Need to Know | Ask the Experts

12/03/2012 9:21 am

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Kim Coleman

Kim Coleman

Posts: 20

12/03/2012 10:11 am

I believe not if you and the other wrote to them.  Go off and google

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12/03/2012 11:51 am

Well if they have admitted fault then they should have reduced your charge accordingly?  Legally I expect your lease allows for interest to be charged.

Plus a court would deem it unreasonable for you to withhold the entire service charge, you could just withhold the disputed amount.  If you have Ground Rent charged through the service charges as well then you are in even more of a sticky situation if they decide to pursue forfeiture...  To me it sounds like currently they have the upperhand.

I suggest you google the "Leasehold Advisory Service" and do some reading up ;-)

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neil ormsby

neil ormsby

Location: SE25
Posts: 3

14/03/2012 1:26 pm

I was told the reason I had to pay interest is because of the clause 3.1 in the Leaseholder covenants, however when you read the clause is says it is rent related 'to pay specific rents', nothing about service charges incurring interest.

However the officer then goes on to say, that and any other monies...
I find this a bit ambiguous to say the least, seeing as there is nothing in the Leaseholder covenants for service charges that start at clause 7.

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Scott Parker

Scott Parker

Posts: 5

15/03/2012 8:16 am

it is likely that the service charge is reserved as rent, the interest clause will then kick in notting hill choose to enforce it.

If you write to notting hill stating the proportion of the service charge you are withholding and why, pay the rest then they will adjust your account as they are a decent landlord.

It would be a bad tactic to withold all the service charge.

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15/03/2012 9:34 am

Surely if they can charge you interest on due money, you should be allowed to charge interest on any rebates due to you.  You could write to them saying if they drop their request of interest you will drop yours.

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Jasmine Ellicott

Jasmine Ellicott

Posts: 18

15/03/2012 9:56 am

They can charge you interest.

Have you put the matter to an LVT (as described in your statement of rights) because until you do this they can argue that you have not contested the charges, and they are fully due.

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15/03/2012 10:24 am

One idea,

1 - You are withholding payments as you have been charged fro services that have not been provided (Lifts), if they agree to this statement then they should have carried forward a creidt for the overcharge through your service charge accounts.  Service charge accounts should be issued at the latest  6 months after their financial year ends. 

In respect to any refund, you need to understand the balance of the service charge accounts as a whole, as you will not get a refund pertinent to 1 service, it is the overall surplus / deficit covering the provision of all services that should inform this decision.

You also comment that charges are unreasoble? this is quite compicated to challenge, there are clear statutory protections for some service costs, info on this is easily accessible via the Leasehold Advisory Service Website.  Challenging "Reasonableness" of charges that fall outside of this category can be tough, if you wish to pursue it you will need to find comparitive costs from like schemes. 

Hope this helps a little, if you provide a bit more detail I may be able to expand upon my advice.

 Good luck

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15/03/2012 11:29 am

If the covenant states they can charge you interest then they can charge you interest.  Most leases refer to "rent" yet this is widely accepted within the legal profession as also including Ground Rent and/or Service Charges.

No you cannot charge it back - not unless the proviso's of the lease allow it - which it won't.  If you see this as unfair - then tough - people should read their leases and understand what they are signing before doing so.  Most people don't.

Unless you have exhausted the dispute with the HA and asked for a full breakdown and justification of costs a LVT will refuse your claim until that point. 

You still should be paying all portions of the service charge however witholding payment for the portion you have already disagreed with.  A Court or LVT will advise it is unreasonable of you to withhold complete payment if you are only disputing a portion of the overall charge.

You will struggle to argue/prove that they are incompetant or bad in their management technique.

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