Ground rent problems

[andydd]

Aha..no..see here > http://www.legislation.gov.uk/ukpga/2002/15/schedule/11

 

P5 (5) says "But the tenant is not to be taken to have agreed or admitted any matter by reason only of having made any payment." but its always wise to also mention you are paying under protest and you reserve your right to make an appliucation under the above legislation to question the payability/reasonableness of the amount.

[Brunel]

I have Rx'd this from Simarc.

 

Dear Sir

 

Thank you for your email, the contents of which we note.

 

We would like to point out that our fees have been found to be reasonable (see HM Courts and Tribunal Service case reference: CAM/00KG/LVA/2013/0001).

 

If you are in any doubt whatsoever regarding this matter we suggest you seek independent legal advice.

 

 

http://www.residential-property.judiciary.gov.uk/Files/2013/June/CAM_00KG_LVA_2013_1_12_Jun_2013_14_21_42.htm

Edited April 9, 2014 by Brunel

[andydd]

Aha..

 

Out of the 4 charges in that case, the Tribunal dismissed 3 in full, they allowed the debt referal fee, BUT that is beacuse there does appear to be a service charge debt and that there debt was actually refered to a debt collection company. (In your case all theyve done is send a letter)

 

In your case its about GR not SC and you have tried to pay the GR.

 

It pointles for them to point to a LVT case which has no relevance, yes, they maybe right that £60 admin charge is a reasonable amount BUT they are missing the main points that your lease does not allow for such a charge and in addition as they havnt sent the Summary of Rights - Admin Charges then you have a right to withold.

 

Youll see that in the above case the Tribunal conclude at paragraph 18 that the phrase used is enough for the landlord/freeholder to recover such admin charges, it is rather vague though and I suspect you could argue against this, you should check your lease to see if you have a similar clause.

 

In any event other LVT cases are not binding, I had Bruce Eddington at mine and he certainly ignored lots of LVT cases I put before the Tribunal, he even commented on it at the end.

 

 

Its interesting that that case is a re-hearing, Ill try and track down the original one.

[andydd]

I'd write to them...

 

Dear Sirs.

 

Thanks you for your previous correspondence. I make the following observations:-

 

Previous LVT/FTT cases are not binding upon another Tribunal.

 

In the case you referenced, the Tribunal concluded that three quarters of the charges were found to be unreasonable and not payable at all.

 

I again, ask you to point to the provision of the lease that allows the collection of admin charges and I remind you of the provisions of The RICS Code which require you to reply to leaseholders concerns.

 

I again, enclose a cheque for the outstanding Ground Rent.

 

Yours

[andydd]

So found the original application..which makes things clearer.

 

http://www.lease-advice.org/decisions/8587pdf/9001-10000/9097.pdf

 

Yes, they conclude that the admin fee for not paying ground rent is payable but again that is because iuch fees are payable under the lease (see Paragraph 15), check yours to see if it has similar clause.

[Brunel]

Thanks again, I have now run out of time, before they set the Legal wolves on me.

[andydd]

Sometimes you can 'force' payment of the GR by paying by standing order/bank transfer into their account if you know the details.

 

As mentioned before it is always best to pay up and sispute later or start an FTT application disputing the amount (alas this is a slow process and a bit of a pain) as oppossed to waiting for the FH/MA to start action.

[Brunel]

Sometimes you can 'force' payment of the GR by paying by standing order/bank transfer into their account if you know the details.

 

They are wise to this, I did have their original bank details, I tried using them but it was rejected.

 

It has either to be paid via their www site or cheque.

[Brunel]

These are the relevant paragraphs from my lease.

 

(4) The Lessor has agreed with the Lessee for the sale to him of the property hereinafter

described (being part of the property comprised in the above title) together with the flat

erected thereon at the price of ********* subject to the payment of a yearly rent of

£60.00 hereinafter reserved and the covenants conditions and provisions hereinafter

contained

 

TO HOLD the demised premises unto the Lessee from the seventh day of September one

thousand nine hundred and eighty one for the term of NINE HUNDRED AND NINETY

NINE YEARS subject to and with the benefit (so far as the Lessor can grant the same) of

the rights privileges easements benefit exceptions and reservations and covenants

contained in a Transfer dated 11th November 1983 and made between Northern Ideal

Homes Limited (1) and the Lessor (2) YIELDING and paying therefore to the Lessor

yearly during the said term the rent of £60.00 to be paid without any deductions in

advance on the 18th of January in every year the first proportionate payment calculated

from the date hereof to be made on the execution hereof.

 

These are the only paras. that mention G.R.......

[andydd]

Are you sure there are no other parts that mention breaches of the lease or breaches of covenant ?

 

Is there a part that mention S146 ?, this is a standard forfeiture clause that often allows extra fees BUT only if the S146 route is followed, which is quite rare these days.

[Brunel]

I have saved a copy of the lease here:

 

https://www.dropbox.com/s/k531ydu14q25ev5/THIS%20LEASE.pdf

 

Only various personel details have been edited.

[andydd]

EEkk.. The usual legalease gooblydok.

 

I cant see any obvious that would allow admin charges to be recovered, but here are some possible clauses:-

 

(2) To pay and discharge all rates taxes duties assessments charges and outgoings whatsoever whether parliamentary parochial or of any other description which now are or during the term hereby granted shall be imposed or charged on the demised premises or the Lessor or the Lessee or occupier in respect thereof

 

This to me sounds like any extra fcosts, taxes, etc imposed on the property can be recovered from you, not extra admin charges they feel like adding on.

 

 

(3) From time to time during the said term to pay all costs charges and expenses incurred

by the Lessor in a

bating a nuisance on the demised premises or any part thereof and

executing all such works as may be necessary for abating such nuisance in obedience to a

notice served by a local or other competent authority

 

This sounds like they could recover costs in stopping you being a nuisance in some way

 

 

c) …..of all rates taxes charg es duties impositions outgoings and obligations

whatsoever which now are or shall at any time during the said term be taxed charged

rated assessed or imposed upon or payable in respect of the Development including the

demised premises unless the same shall be separately taxed charged rated assessed or

imposed upon the demised premises or the Lessee or the occupier in respect thereof such

proportion in the case of difference to be settled by the surveyor for the time being of the

Lessor whose decision shall be binding AND to keep the Lessor indemnified against all

costs and expenses as aforesaid

 

Not sure about this, it sounds similar to the first one (2) in that extra taxes and charges imposed on the property could be recovered but I'm not 100% sure.

 

(10) If the Lessee shall make default in any of thecovenants hereinbefore contained relating to the repair of the demised premises it shall be lawful for the Lessor (but without prejudice to the right of re-entry hereinafter contained) to enter upon the demised premises and repair the same at the expense of the Lessee in accordance with the covenants and provisions of these presents and the expenses of such repairs shall be repaid by the Lessee to the Lessor on demand

 

This says that if there are parts you are obliged to repair but dont then the FH can come in and repair them

 

(16) To pay to the Lessor all expenses (including solicitor's costs and surveyor's fees)

incurred by the Lessor incidental to the preparation and service of a notice under Section

146 of the Law of Property Act 1925 notwithstandingforfeiture is avoided otherwise than

by relief granted by the Court

 

. This is standard clause and it would allow extra charges and legal costs to be recovered but only if the S146 forfeiture route is used, my FH used to be sneaky and kind of follow the S146 route but then just use standard civil money recovery route, he was doing this in an attempt to try and recover extra costs and charges.

 

(17) To pay all costs charges and expenses

(including Solicitor's Counsel's and Surveyor's

costs charges and fees) reasonably incurred either in granting any consent under this

Lease or in connection with any application for any such consent

 

. Again, costs can be recovered if you ask for consent to sublet or build extension, etc.. This is not the case here

 

 

Clause 7 THE Lessee hereby covenants with the Lessor that ifat any time during the subsistence of the said term any sum or sums shall be expended by the Lessor under or by virtue of the last proceeding clause hereof and shall be unpaid to it by the Management Company

 

Not sure about this, the last clause it refers to is about the management company not doing its job or being disolved

 

 

 

the Lessee will on demand pay to the Lessor such a proportion of the aggregate amount of such sum or sums as shall be certified by the Surveyor for the time being of the Lessor as being a fair and just proportion thereof but without prejudice to any right of recovery contribution or indemnity from the Management Company

 

as above

 

(ii) If the rent or other monies hereby reserved ormade payable or any part thereof shall

be in arrear for twenty

-

one days after the same shall have become due whether the same

shall have been legally demanded or not or in the event of any breach non

-

performance

or non

-

observance of any of the covenants conditions and agreements on the part of the

Lessee herein contained then and in such cases it shall be lawful for the Lessor

or any

person or persons duly authorised by it in that behalf to enter into or upon the demised

premises or any part thereof in the name of the whole and peaceably to hold and enjoy

the same thenceforth as if those presents had not been made but without

prejudice to any

right of action or remedy of the Lessor in respect of any antecedent breach of any of the

covenants by the Lessee hereinbefore contained

 

. This would appear to be the only clause related to non-payment but it doesnt say they can add extra charges just they can enter the property (but I doubt this is legal without soem extra court action).

 

Ultimately though, this is a tripartie leases, meaning it involves 3 parties, you, Freeholder and management Company and can be complex, you really need a reply from early correspondence and find out under which clause they believe they can charge extra admin fees for late payment and/or breach of lease, I cant see an obvious one.

 

Not forgetting of course that without the demand for the extra admin charge being sent accompanied with this > http://www.lease-advice.org/publications/documents/document.asp?item=89 then nothing is payable (but dont flag this upto them yet).

[Pete Ads]

Hello everybody, i'm having a similar issue with Simarc; interestingly they quoted the same rhetoric to me about that court case.

 

My situation is that i filled out their online form and gave my email address; in so doing I agreed to receive future GR notifications by email. I left my company and forgot to update the email address (my bad); they sent the GR demand for 125 and clearly it bounced back as i didnt exist any more. They did nothing else, then 4 weeks later, they charged 96 admin fee.

 

I've written to them asking for a copy of the original email and attachments (to see if it has the attachments you reference); I've also asked them to summarise the work they did when in their response they said "As a result of non payment [of the GR] additional costs were incurred in recovering payment of the arrears. We regret that we are unable to reimburse charges incurred"

 

I've paid the admin fee so i'm not time bound on this one but i want to know if it is worth going to tribunal. Presumably tribunal will cost me about 50 quid, so i'm arguing over 46 quid and I dont know if it's worth it even though the principal is.

 

all help gratefully received;

Pete Ads

[andydd]

Hi Pete.

 

Yours is such a common problem..and once again its Simarc !

 

Please start a new thread and Ill try and help.

 

There are all sorts of laws to comply with before the admin fee is payable, and often Simarc do not comply.

 

Andy

[Pete Ads]

Thanks AndyDD - i set up a new thread. #post4554724

[andydd]

Reply from Simarc.....

 

I am in receipt of your e-mail communication with Beejal of this office and I note the contents.

 

Firstly, please be advised that your ground rent is £150.00 per annum payable yearly in advance on the 25th March each year and this is stated clearly in your Lease. It is clear from your Lease that the onus on paying the ground rent on the due date is the responsibility of the Leaseholder.

 

Please note our fees are determined by the time spent and work undertaken on each separate file. We are not obliged to go into any further details with regards to arrears file preparation as this is work undertaken by Simarc on behalf of the Freeholders.

 

Please be aware that as the leaseholder of the above property it is your responsibility to ensure that ground rent is paid on the due date or before with accordance to the lease. As you are no doubt aware you have failed to comply with the terms of your lease and as a result the Freeholders, Wallace Estates Limited have incurred charges due to late payment and a breach of lease.

 

Our rent demands are fully in line with statutory requirements and contain all statutory wording as required by law.

 

We wish to inform you that yourself and the Landlord are in a binding contractual relationship. Your failure to pay ground rent is a breach of contract. Any party breaching a contract is liable for the resultant costs incurred by the innocent party. This includes the administration costs in seeking to recover the amount now overdue. As you will no doubt appreciate from our point of view, payment of your ground rent is overdue and additional administration costs have been incurred in attempting to resolve this matter.

 

We are entitled to charge an arrears fee for late payment of ground rent; however, as a gesture of goodwill, I have taken the necessary steps to have the arrears fee reduced to £54.00 inclusive of VAT. The sum required to bring this matter to a conclusion is now £354.00 this includes ground rent in the sum of £300.00 and a reduced late payment charge of £54.00. This is to be received in our office within 14 days from the date of this email.

 

So read the reply below and it doesn’t seem like much has changed, I re-read the CAG post and my last replies are still relevant,.

 

To summarize:-

 

1. Ground Rent is payable if requested in line with s166 of Commonhold & LH Reform act 2002 and it lines up with dates in lease, Its INCORRECT to say onus is on LH, it MUST be demanded first.

 

2. Admin fees for non-payment are only due IF the lease makes it clear they are payable, the LVT case they refer to, http://www.residential-property.judiciary.gov.uk/Files/2013/June/CAM_00KG_LVA_2013_1_12_Jun_2013_14_21_42.htm makes this clear as the lease in question does allow the charges, without a specific clause then admin charges are NOT payable, (this is settled case law and many FTT/LVT decisions say this)

 

3. Admin Fees are also only payable IF demanded with exact Admin Charges – Summary as per here > http://www.lease-advice.org/publications/documents/document.asp?item=89

 

Now they seem to be arguing that the above doesn’t apply and that you have broken a contract and therefore they can claim extra costs, there is some truth in this..effectively what they are saying is that they are claiming damages BUT to be payable this would first have to be proved at court AND most importantly they have a poor grasp of the law, they would have to show that by not paying GR they have suffered some loss (above the GR amount), but what ?, they have simply not got the GR, it hasn’t effected anyone else, nothing has happened to the company, it hasn’t caused them extra expense…what they would LIKE to say is that it caused them, to chase you and incur extra expense, this is true BUT if they wanted to recover these losses then the lease MUST allow it..as many do..but it appears yours does not.

 

Another good example, I sued my FH for damages for not repairing driveway, I won..but the Judge said I hadn’t really suffered any loss (prob true to be fair), and just awarded me £100 nominal, now IF as a result of breaking the contract (FH not repairing) someone had tripped up and broken his neck..he could sue the FH for damages of maybne millions, compare this to your case, how does you not paying the GR cause them any loss at all ??