Management company using section 121 to recover arrears

[mathematricks]

I am a freeholder with a covenant to pay for the upkeep of communal facilities - which is shared with other freeholds and leasehold flats. My Transfer (TP1) does not have an annexed 'right of entry' clause. The service charges are regarded as estate rentcharges (although not explicitly stated in the transfer).

 

I have very good grounds on disputing the service charges, for which I would actually like to the County Court to make a judgement. The management company employed a solicitor firm a few years ago to threaten me into paying all costs. I paid for costs that I thought were reasonable, which they did not accept as a settlement. I expected a county court summons - instead nothing happened for a couple of years and now the management company have employed another solicitor firm.

 

I've asked the new solicitors to go to the county court for a judgment. Instead, they've decided to approach my mortgage company based on section 121 of the Law of Property Act 1925.

 

I understand that under this law, the management company can take possession of my property only to recover the cost of the rentcharge. However, my dispute is that that I have not broken the covenant as the costs I'm being charged for are unreasonable.

 

The solicitors wrote the mortgage company saying that "under section 121 of the Law of Property Act 1925, to obtain possession a County Court Judgment is not required... if payment is not made within 14 days, we will enter into possession without any further notice".

 

My mortgage company has told them that they won't be taking any action (at least for now) and for me to contact he solicitors to sort out the issue.

 

I'd be really grateful if someone can clarify how they can enter possession without a County Court Judgement?

[legalistic]

I would get on with challenging the service charge. There is an excellent summary of the law re service charges in the Estates Gazette of 28 May 2016. (Service Charge Shortfalls). Essentially the problem can be challenged under sections 35, 37 Landlord and Tenant Act 1987. An application is made to the Fist-Tier Tribunal (Property Chamber).

[mathematricks]

Hi legalistic,

 

I do not have a leasehold property. It's a freehold property with a covenant to pay for the upkeep of the communal facilities. This would render the arrangement into an Estate Rentcharge, which is not covered by the Landlord & Tenant Act 1987. There is no provision for a leasehold tribunal. Instead, it is covered by the Rentcharges Act 1977, and further, the Law of Property Act 1925.

[legalistic]

Mathematricks, apologies, I didn't read your post carefully enough. I don't know anything about Rentcharges, but googled "estate rentcharge" and there was all sorts of information. I expect though that you've already done some googling yourself. Hopefully someone will help you on this website. The Estates Gazette article is excellent where leases are concerned and hopefully someone will get some benefit out of it.