Leaseholders in Wonderland
Small building, small garden, big service charges. In this block of six flats, most of the leaseholders paid the service charge even though it seemed excessive.
One leaseholder refused to pay charges he thought were outlandish, unwarranted and unfair. He wrote to the managing agent, the managing agent wrote back, nothing was agreed - and the managing agent charged for each letter, even if the new letter was due to their negligence regarding earlier letters.
This point is worth highlighting: the agent charged a letter-writing fee even if it was his fault for having to write the letter. And from the agent's point of view, this strategy, while blatantly unfair, achieved its purpose. Most of the leaseholders were docile and paid the outlandish invoices in the first place. If they resisted, they caved in after a few letters and the threat of increased fees.
The leaseholder who refused to pay was the rare exception, and the dispute was resolved only with a decision from the Leasehold Valuation Tribunal.
Your Day in Court
If you are a leaseholder and you think your freeholder - more likely, the managing agent - is cooking the service-charge books or otherwise not following the rules, you can have your day in court.
It works both ways: freeholders can apply for justice too—for example, against leaseholders who withhold rent or make structural changes without permission.
LVT's are part of the Residential Property Tribunal Service, and the RPTS website (rpts.gov.uk) fully describes what they do and how they do it. The site has three separate sections, one each for landlords, tenants and leaseholders. It also lists LVT publications and forms; all downloadable or viewable as web pages.
"Leasehold Valuation Tribunals: Guidance on procedure" is a 39-page brochure detailing the kinds of issues the Tribunal can, or can not, deal with, and describes procedures for each. The site also contains all LVT decisions - useful for getting insights into the thinking of the panel members, and the kinds of awards they make.
Before You Go...
The Residential Property Tribunal Service brochures should keep you busy for a while. Other organisations also provide useful information.
LEASE Like the RPTS/LVT, the Leasehold Advisory Service is impartial. “The Leasehold Advisory Service provides free advice on the law affecting residential long leasehold property and Commonhold.” LEASE pamphlets are written in clear and simple language - and all are available on their website (lease-advice.org). “Living in Leasehold Flats: A guide to how it works, your rights and responsibilities” is a good general introduction.
CARL – Campaign for the Abolition of Residential Leasehold (carl.org.uk) - is not impartial. The organisation distributes a newsletter and lobbies Parliament to abolish leaseholds. CARL regards leaseholds as "a medieval system that enslaves and entraps leaseholders."
FPRA - the Federation of Private Residents' Associations (fpra.org.uk) speaks for tenants' associations and resident management companies.
When You Go...
Managing agents tend to have staffers who do this for a living - and know the system.
Ordinary leaseholders generally do it themselves, and have not run the course before.
When you argue your case before a tribunal, you submit a written brief outlining your arguments. It can take many hours to prepare a logical and well-written brief.
In this case study, a defiant but ultimately successful leaseholder spent dozens of hours exchanging letters with the managing agent and then preparing lengthy detailed briefs for the tribunal.