Extortionate late payment fee

[Ruth Andrews]

Hi all, I'm new here so please be kind

 

I pay a portion of a block buildings insurance policy for my leasehold maisonette. The premium is very high (£375 per unit), but until I get round to taking proper legal advice I will continue to pay it. On receipt of the latest demand, I requested a copy of the policy itself, to which I am entitled and which I have previously received. I called the managing agent, expressly said I was willing to pay, but wanted a copy of this first for my own records. The agent who deals with my property was on holiday, I was told a message would be passed on. 14 days later I had received nothing so called again and was told the same thing. On each occasion I made a note of the person I spoke to and the date. A further week or so passed and I received the policy copy. I then telephoned the agents to say I would be making payment by bank transfer within the week. I set up a payment that day to leave my bank seven days hence (today), and luckily took a printout of the payment instruction. This luckily also shows the payment was set up on 3rd July, and not today (10th) as a result of the second letter I received today, demanding the premium, along with a £120 'Initial Debt Collection Fee'. I am obviously outraged as at no point have I been unwilling to pay this charge; I've even telephoned THREE TIMES to say I would be paying it one I received a copy of the policy. I've emailed the company to say I believe this must be an oversight on their part and that this fee should be retracted, but have had no reply as yet and previous experience with this company leads me to believe they will dig their heels in and be as difficult as possible.

 

The question therefore is, am I liable to pay this? As I understand it, only 'reasonable' administration costs can be charged. This is clearly far from reasonable in many respects, not least the fact that I have made every effort to secure the paperwork I wanted in order to pay it. On top of this, I've since discovered the director of the managing company is also an on/off director of the freeholding company. He's a piece of work so I don't want to get into a slanging match with him, but would like to know how strong my position is in refusing to pay this extra charge. Many thanks for your time...R.

[BRIGADIER2JCS]

Unless there is a specific clause in your lease and or management contract the 'debt collection fee' is purely speculative, and also totally unreasonable.

[Ruth Andrews]

Thanks, Brigadier. As I thought. There's no such clause so I will tell them where to get off.

[Average_Joe]

I wish you luck Ruth. I am in the same position as you, however, the FH won't back down despite no clause being present.

[stu007]

Hi these PDFs may be of some use to you:

[stu007]

And this one also:

[ericsbrother]

Invoice them for £160 for wasting your time in not replying to your payment reminder.

Ask them for copies of the other quotes they obtained before settling for this particular policy and the name and address of the relative who owns the brokers they use.

[Ruth Andrews]

Stu007, many thanks for all the attachments you posted. Really helpful. ericsbrother, I thought exactly that. It's an AXA policy but as you say, whose pocket is the (presumably massive) broker's fee going into? I need to take some advice and see if I'm entitled to ask for evidence of other quotes. I'm also having my lease checked again legally as it's a little woolly as to whether they can even enforce a block policy rather than just request evidence that a comparable level in cover is in place.

 

Average_Joe sorry to hear of your similar troubles. I have had some luck as after sending a very strong email, I received a retraction of the fee so I am now sorted, if still angry for the inconvenience and worry caused to me.

I spoke to Leasehold Advisory Service who are very good, even if you have to wait on hold a good while to speak to someone. They advised that £120 was totally unjustifiable and to threaten to apply to what's now called a 'First Tier Tribunal' in order for them to have to justify this, which they clearly could never do even if I had been late with the payment. So my advice is to persist and call their bluff if necessary. They're unlikely to follow any threats through unless they can back up their charge in a tribunal, and they won't want to risk incurring costs as well. Good luck and thanks to everyone who tried to help