Housing Association Charges

[Melstin]

I've been a 50% leaseholder with a very well known HO in West London for the past 18 years. At the very beginning, when they were small, they offered a decent service, but now they are absolutely useless. They make lots of costly mistakes and when you approach them to complain, they give you the run-a-round. After all it is not they money they are wasting.

Two years ago they took out a 12 month parking enforcement contract with a firm of clampers costing £362, which they had to cancel after only one month, because they discovered the road that was to be patrolled, did not belong to them. However, they never returned the money to the residents.

Every time I approached them asking for our money back, they promised me that it would be done at the end of the accounting year, but this never happened.

In addition, I'm not at all happy about other charges to do with maintenance. This because jobs were either grossly overpriced or never satisfactorily carried out.

To clean the gutters after they kept overflowing, I had to spend £150 of my own money on a ladder (after I pay them to maintain and to manage this place), because the retards they employ never do the job properly. And complaining is a waste of time! They never reply to you.

I have made 4 different requests to view the invoices during the past 5 weeks, but they still have not been willing to help me. I may also add that relationship between us is very strained at the moment. They are robbing me blind and I'm absolutely furious about it.

What should I do?

[demon_x_slash]

Start to create a paper trail for all this, as you'll need one for any court action that may result. You need to write to them to obtain invoices/schedules of work/receipts for the services rendered, and to register your dissatisfaction - see the sticky in General Issues titled 'How to Complain?' for a succint example of how to do so effectively. Insist on a written response. From their reply, you can begin to build an idea of how to proceed - whether it is seeking recompense, claiming back the money for clampers, or discontinuing the contract.

[Ed999]

The obvious solution is for all the tenants in your block to take collective action.

Refuse to pay the service charge until your complaints have been resolved to your satisfaction; or at least don't pay the disputed items.

Read this thread: http://www.consumeractiongroup.co.uk...ggestions.html

It sets out some possible defences to an unlawful service charge demand.



Advice & opinions on this forum are offered informally, without any assumption of liability. Use your own judgment. Seek advice of a qualified and insured professional if you have any doubts.

[demon_x_slash]

With respect, Ed, I feel that they can't refuse to pay the service charge until the company have been made aware in writing about the grievances - if they do have to eventually take court action, it will prove that the OP and/or the rest of the tenants have tried to resolve the situation without resorting to court at the get-go. Of course, if they fail to get a satisfactory response after that, then I agree with you that they should jointly stop paying the service charge and raise action for the money lost on the clampers.

[Ed999]

I was advising the o/p of his legal rights, not setting out a timetable.

Since service charge demands are only served annually, there is ample opportunity for the tenants to raise the issues with the landlord, and indeed also to send a letter before action to the landlord, before the next annual service charge demand is served.

The o/p appears to have already contacted the landlord four times about the problems, and been given the brush-off.

There is nothing to be gained from wasting time on protracted negotiations if the landlord is recalcitrant. A letter before action should not be a forerunner to lengthy correspondence, particularly if the landlord is unresponsive, because the landlord will conclude that the tenants are not serious in their intent.

A possible course of action would be, firstly, to convene a meeting of the tenants in the block to discuss their legal rights, and to assess what support there is for the o/p's position.

Some tenants will probably not have paid the latest service charge demand yet, in the nature of things. Others will have done so. But payment is NOT a bar to a claim for a repayment.

Is there support for collective action? If so, an action committee should be formed, and a letter before action written.

Some available defences are outlined in this thread: http://www.consumeractiongroup.co.uk...ggestions.html

The letter might include such of those points as are relevent in this case.

[Melstin]

First and foremost many thanks for your advice.

Yesterday I had the chance to speak to all the 10 leaseholders and believe me, they are all sick to the back of their teeth. Everybody finds it extremely hard to communicate with the HO, which is one of the largest in the country. They either never replay or they take you for a ride when they do.

Our service charges are paid monthly into a special account, with an amount set aside for major repairs. Whenever a job is done, the contractor bills the HO directly, so there is ample scope for ripping the residents off, because the latter never see the invoices and the HO never carry out spot check on what has been done or not.

What is is certain that I would never advise anyone to bay into a shared ownership. What a rip off!!

[Ed999]

Originally Posted by Melstin

Our service charges are paid monthly into a special account, with an amount set aside for major repairs. Whenever a job is done, the contractor bills the HO directly, so there is ample scope for ripping the residents off, because the latter never see the invoices and the HO never carry out spot check on what has been done or not.

A first step then might be for you to read your lease and see from it whether you are required by its terms to pay the service charge monthly. Always best to know what the legal position is!

Then you might get the Letter Before Action written, and sent, using the appropriate points from the suggestions I've drawn to your attention: http://www.consumeractiongroup.co.uk...ggestions.html. Give the landlord 21 days to respond.

If the landlord's response is unsatisfactory, or if no response is forthcoming after 21 days, then stop the monthly service charge payments.

If the landlord sues, base your defence on the relevent legal points to which I've drawn your attention. The landlord will probably pick on one tenant to sue, as a test case.


Are you aware of your legal right to have the service charge accounts audited? It can be an expensive procedure, but it is possible.

The procedure is specified in Section 22 of the Landlord and Tenant Act 1985 -

22.—
(1) This section applies where a tenant, or the secretary of a recognised tenants' association, has obtained such a summary as is referred to in section 21(1) (summary of relevant costs), whether in pursuance of that section or otherwise.

(2) The tenant, or the secretary with the consent of the tenant, may within six months of obtaining the summary require the landlord in writing to afford him reasonable facilities—
(a) for inspecting the accounts, receipts and other documents supporting the summary, and
(b) for taking copies or extracts from them.

(3) A request under this section is duly served on the landlord if it is served on—
(a) an agent of the landlord named as such in the rent book or similar document, or
(b) the person who receives the rent on behalf of the landlord;
and a person on whom a request is so served shall forward it as soon as may be to the landlord.

(4) The landlord shall make such facilities available to the tenant or secretary for a period of two months beginning not later than one month after the request is made.

The upshot is that you will often need to instruct an accountant to examine the documents, once obtained.


The section 22 procedure requires you to make a written request under section 21 of the 1985 Act first -

21.—
(1) A tenant may require the landlord in writing to supply him with a written summary of the costs incurred—
(a) if the relevant accounts are made up for periods of twelve months, in the last such period ending not later than the date of the request, or
(b) if the accounts are not so made up, in the period of twelve months ending with the date of the request,
and which are relevant costs in relation to the service charges payable or demanded as payable in that or any other period.

(4) The landlord shall comply with the request within one month of the request or within six months of the end of the period referred to in subsection (1)(a) or (b) whichever is the later.

(5) The summary shall set out the costs in a way showing how they are or will be reflected in demands for services charges.

(6) If there are more than four flats in the building or the costs also relate to another building, the summary shall be certified by a qualified accountant as—
(a) in his opinion a fair summary complying with the requirement of subsection (5), and
(b) being sufficiently supported by accounts, receipts and other documents which have been produced to him.

You will notice in sub-section (6) that the landlord has to have the summary certified as correct by an accountant, so it is no longer just the landlord's opinion.



Advice & opinions on this forum are offered informally, without any assumption of liability. Use your own judgment. Seek advice of a qualified and insured professional if you have any doubts.

[Melstin]

Thanks again for the advice.

Yesterday the HO emailed all the invoices I had requested, bar one and when I looked at the specific one concerning the total cost of a small repair to my back fence, I nearly fell off my chair.

To make a long story short, to replace 10 fetherhedge boards on my fence, which cost £8.99 in Wickes and yes there are also 20 nails and half an hour's work, the total bill came to a staggering £408.75. This because the contractor lied on the invoice and the HO handed over my money without checking what sort of job the contractor had done.

I don't know what you call this, but to me it is fraud. Should I speak to the police or simply ask for my money back?

[Ed999]

There might have been a fraud. Contact the police if you want them to investigate; but you might have better luck by contacting the Trading Standards department at the Council. Also, note that a prosecution will not get you your money back.

You should notify the landlord of the suspected fraud, in writing. Ask for your money back, and invite their response.

Any disputed items on the invoices that were taken into account in preparing the service charge accounts can be dealt with by way of a deduction from the service charge payment.

You need to seize the initiative. You are at an obvious disadvantage if you pay the service charge by monthly standing order. If it is lawfully possible to do so, i.e. under the terms of the lease, then all of the tenants should pay annually by cheque.

Is the landlord really hostile? It doesn't look like it, from the speed of their response to your request to see the invoices. Treat the landlord amicably unless and until there is real genuine cause not to do so. Court action is a LAST RESORT not a first option.



Advice & opinions on this forum are offered informally, without any assumption of liability. Use your own judgment. Seek advice of a qualified and insured professional if you have any doubts.

[Melstin]

Many thanks to you all!!

The HO refunded some money and I'm now waiting to hear from them about other matters.