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Tribute toan industry friend Alex Greenslade
TheMagazine For Apartment Living
£4.50 Issue99 /2019
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FixedCharges: Bewareofwhat youcanchallenge
QUESTION We are leaseholders in a
in conjunction with the freeholder, had decided to pay the money into the sinking/reserve fund. The leaseholders are not at all agreeable to this since this would mean some have paid in substantially more into the fund than others. Also, the money was collected as part of the service charge and should therefore be returned to them in the same way. The reason they are keen to do this is because, without leaseholder consultation, the previous managing agents, spent over £300,000 out of the reserve fund. For this reason there has been a monumental delay in issuing accounts whilst they have tried for three years to fudge the numbers. Do you have any advice as to how we can approach this issue with them? Knowing there are huge S20B bills coming is horrendous, but being told they also plan to confiscate a refund of about £500 per flat is sickening. And, if they had listened to the initial concern about the water bill in 2015 the size of the error would have been much smaller. ANSWER It is difficult to answer this question properly without reviewing your lease (and, in particular, the service charge
mechanism in the lease). Some leases provide for separate water charges. I do not know if that is the case here. In general, however, and with the caveat that I have not seen any of the papers, I would tend to agree with you, on the assumption that the water charges in question where paid by individual leaseholders as part of their routine service charges and not out of the reserve fund. Where money is paid by one party to another due to a mistake of law or fact, the individual who made the payment may have a right to claim that money back, in restitution (subject to certain conditions being met). In my view, it would not be open to the management company to simply take those sums, which belong and are properly owing to the leaseholders, and transfer them into the reserve fund. The lease will specify the mechanism for recovering and when contributions towards the reserve fund should be collected, and demanded; and what types of expenditure the reserve fund is set up to cover. Assuming the lease allows the landlord to maintain and collect and demand contributions towards a reserve fund, it may theoretically be possible for the landlord to demand contributions towards the reserve fund which calculating service charges, which will include how and
Insurance: Tipstostay protected
block and the issues we are currently battling are large and numerous and, like many others, we find ourselves in a David v Goliath situation. Our immediate issue is as follows: a resident noted a 60% increase in 2014 in the water bill compared to previous years. The freeholder and managing agent ignored all requests After three years, Thames Water admitted to a mis- connection of a new water pipe. It meant one part of the estate was being billed for all water used onsite - whilst the additional water was also being billed to its end user. As such a £198,000 credit was paid back to the managing agent for distribution to those affected (those were were mischarged for four years) on 12th September 2018. The managing agent initially agreed this would be credited back to the service charge accounts of those affected and would be used to fund the S20B costs they plan to charge us for overspends in 2015 and 2016. Not having received any word of this credit in eight weeks, we followed up with the managing agent only to be told that they, to investigate so the resident followed up.
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