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Stuart J
Stuart J, Solicitor
Category: Law
Satisfied Customers: 22624
Experience:  PGD Law. 20 years legal profession, 6 as partner in High Street Practice
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Hello, Im having issues with my estate management company

Resolved Question:

Hello,

I'm having issues with my estate management company which manages a block of leasehold aspartames (lets name it CCC, it was appointed as managing agents by XXX Ltd which is the company that residents formed), I have been in dispute with them for over 5 years. Here is some background information. Few months after I made renovations, a leak started in my bathroom, the leak was from upstairs neighbours pipe, but management agent refused to send plumbers to repair it as I was in arrears with service charge. Few months later it was finally repaired but my bathroom was in ruins. Yet again management agent refused to repair it, the I decided not to pay the SC until it's repaired.

As a result they added Administrative charges ranging from £120 to £168 (every time different amount) plus legal costs of £360 . When I refused to pay they approached my mortgage company who paid it without my knowledge.

Now they have sent another demand, original arrears £278.41 plus which somehow has risen to £691.46. (I can show the documents later on if needed)

HERE IS MY QUESTION

Can I sue or challenge this charges in court?

Over the years the have taken more that £2000 in admin charges, which as I understand can be recovered (unreasonably high or penalising)

Regards Garik
Submitted: 4 years ago.
Category: Law
Expert:  Stuart J replied 4 years ago.
Hello, I am Law Denning and I am a practising solicitor in a High Street practice. I have been an expert on this website in UK law since 2008. During that time, as you appreciate, I have answered thousands of questions from satisfied users on a variety of subjects. Because we are all in practice with clients and court and other users, I might not always respond in minutes. Please bear with me in that case

It is my pleasure to try and assist you with this today. Please bear with me while I gather some further information from you in order for me to be able to advise you fully.

Unless I have all the facts that I need, my answer would not be accurate.

What are the issues?
Customer: replied 4 years ago.

Please let me know what details you need.


Please follow the links to see some of the letters they sent me.


 


http://clients.barseghyan.com/docs/charges.pdf


http://clients.barseghyan.com/docs/DebtorHistory.pdf


http://clients.barseghyan.com/docs/initial.pdf

Expert:  Stuart J replied 4 years ago.




They can only
charge you a late payment charge which is a genuine measure of the costs they
incur in chasing you for the money. They cannot charge or enforce one which is
seen as a penalty.

On the other side
of the coin, you cannot withhold service charge for the reasons that you have
been and therefore, you are liable to pay the late charges I am sorry to have
to tell you.



If they issue
proceedings against you for the service charge arrears, and counterclaim for
the cost of the damage to your bathroom/property.



Whilst you are
not able to withhold service charge because they haven't done something, and
your remedy is to sue them in respect of what they have not done, by the same
token, they are not allowed to refuse to do repairs because of non-payment of
service charge.



At the moment,
you are at an impasse.



My suggestion
would be to pay all the service charge which is outstanding, apart from the
late payment charges although I will come to those in a minute. I would then
issue Small Claims Court proceedings against them in respect of the damage.



I will tell you
that even if you pay the outstanding service charge, they are likely to offset
the service charge payment against their late fees which they allege are owing
so your account will see the payment allocated against previous service charges
and previous late payment charges and therefore the current charges will be up
to date.



I'm sorry to have
to tell you that you will have handled this very badly and quite wrong.



The correct way
of dealing with this was to pay the service charge and sue for the repairs and
the damage.



You will probably
find that in your lease, they are entitled to recover the costs of chasing and
suing you in respect of outstanding service charge and in this respect are
therefore even if the matter is Small Claims Court, if you lose, you will end
up paying legal costs but even if you win, you will not get them back



I appreciate that
the majority of this is probably not what you wanted to hear, but there is no
point in me misleading you



Does that answer
the question.? Can I assist any further?



I am happy to
follow up any individual point you make



I am online and
off-line each day and most weekends.



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Customer: replied 4 years ago.

2 questions


 


I will tell you
that even if you pay the outstanding service charge, they are likely to offset the service charge payment against their late fees which they allege are owing so your account will see the payment allocated against previous service charges and previous late payment charges and therefore the current charges will be up to date.


(can you explain it a little more?)


I'm sorry to have
to tell you that you will have handled this very badly and quite wrong.


 


I know :(


 


 


You will probably


find that in your lease, they are entitled to recover the costs of chasing and
suing you in respect of outstanding service charge and in this respect are
therefore even if the matter is Small Claims Court, if you lose, you will end
up paying legal costs but even if you win, you will not get them back


 


OK is have they spent £120 to chase me? It's just a letter they sent. Will the adjudicator see this fees as unreasonable? (what are your toughs? I imagine you have seen lots of cases like this. )

Expert:  Stuart J replied 4 years ago.




I have indeed
seen many of these. They generally come home to roost when the leaseholder
comes to sell the property. The management company has to consent to the
transfer and will not do that unless all the arrears are up-to-date.

To explain the
little bit about allocation.



Let's say the
service charge is £100 a year.



You don't pay and
they levy a late payment charge of £20.



You don't pay for
the next four years so you are now in arrears of £500 and they have also given
you a late payment charge for each year of £20 so they will say that you owe
£600.



If you then pay
all the service charge arrears of £500 they will say that you have paid £400
service charge arrears plus £100 late payment charges so your account therefore
is still a £100 service charge outstanding. And there you are, have another
late payment charge of another £20 so you now owe £120.



I have seen it so
many times and this needs resolving now because until it is resolved, you will
not be able to sell the property and they will keep adding late payment charges
ad infinitum.



I think £120 is
unreasonable and £50 is more likely however the cost of arguing it is going to
be more than you are arguing over.



Customer: replied 4 years ago.

There are over £2000 in late fees or admin charges that have already been paid (as stated on the pdf I sent) Do you think I can recover part of that trough small claims?

Expert:  Stuart J replied 4 years ago.

If you don't agree with those charges and they wont refund, that is your remedy, letting a judge decide.

I understand how you feel and I feel for you. It annoys me that these mgt cos hold people to ransom.

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