What do the service charge provisions in the lease say?
What is the definition of proper proportion and service expenditure please?
Thanks. Service expenditure?
Potentially it is reasonable if the landlord has an obligation to maintain/decorate the exterior of the building.
I cannot see from the snapshots whether you pay a sum on account of services to be performed or if the landlord can charge on an ad hoc basis. There should be transparency in what service is to be undertaken and its cost, the landlord should evidence so that tenants are aware if how the cost is made up (core principle of the rics service charge in commercial property code 3Rd edition). Managers are also expected to communicate adequately with occupiers.
If the landlord/manager fails to communicate and disclose quotes/estimates following a request and fails to justify the service charge demand you should have a right, set out in the lease, to challenge by use of alternative dispute resolution or referral to an independent expert, independent rics qualified surveyor.
It depends what the lease says on this, the rics code, referred to above, is merely guidance and best practice and cannot override the lease.
Potentially you may be contractually bound to pay - it depends on the construction of the lease and whether the lease contains a provision allowing you to dispute it.
It is difficult to comment by reference to the snapshots as clauses often cross refer. I would really need to review the lease in full. I am agreeable to review this for you as an additional service, if you agree.
Do you have any questions or queries in respect of my answer?
also check rics service charges occupier guide 2011
This site works in $. I propose $35 to review the service charge provision.
Thanks, ***** ***** the proposal and then message me with the lease attached as a pdf. Att ha via the paperclip icon.
Will it not attach. I am prohibited from using private email.
Try to send in several parts.
Thanks. I have downloaded it. I will review and come back to you shortly.
Ok. What you have is a basic lease based on the law society's business lease. Very rarely used by the profession due to its limitations.
The service charge is made up of the costs reasonably incurred by the landlord in performing the obligations in cl. C3 and in accordance with good estate management.
C3 sets out the services. Of relevance to the situation is the services of repair and deterioration of the common parts, structure, foundations, roof and exterior. The costs incurred must be reasonable.
A3.3 states you are to pay any shortfall between payments on account and the actual costs incurred.
A3.4 obligated the landlord to keep records, receipts, invoices. Quotations are not mentioned but it is totally reasonable to request to see any quotation for works to be undertaken.
If you consider the that the landlord is not acting reasonably then you can dispute the charge, you have a right to do so under cl. A3.5. Raise the dispute with the landlord first and allow 14 days for a response. If the landlord fails to respond or provide adequate information (do refer the the two guides I mention in previous posts for guidance) then you can refer the matter to a surveyor for determination.
The surveyor will be independent and act as an arbitrator. It may take guidance from the rics code but ultimately will be bound by the provisions in the lease. This means that the independent surveyor will determine if the decorating costs are reasonable.
There is no mention in the lease of how the independent surveyor's costs will be paid.
I hope this helps.
No probs, all the best.