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Hi All,

 

I'm hoping someone can give me a steer on the correct course of action here.

 

I "own" a leasehold property with an annual service charge of £150 payable annually in advance.

I foolishly missed the payment in April this year and received an invoice for the payment due plus a "reminder fee" of £34, which i duly challenged in writing, accepting the original £150 was payable but asking where in my lease it states that the reminder fee is payable.

I also requested a breakdown of the £34 fee as I believe it to be disproportionate.

 

I received a response stating that this fee will not be waived but no breakdown and no reference to the clause in my lease that allows a reminder fee to be charged (I'm unable to find such a clause).

 

I challenged again, stating I was happy to pay the outstanding balance, less the reminder fee unless they responded to my request for further information.

 

I received no response but have today received a letter from Property Debt Collection Ltd, in respect of the outstanding amount of £150, plus the reminder fee of £34, plus another £80 admin fee, plus an additional £150 for PDC's instruction: a total of £414.

 

My questions are:

 

1. Are any of these fees lawful

 

2. Should I contact PDC or the original management company and pay the outstanding balance of £150 whilst I challenge the remainder?

 

3. Is there a valid challenge or should I just suck it up and pay?

 

3. Is there some other action I should take?

 

Any advice would be gratefully received...

 

Many thanks

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Well you should set about reducing the problem as much as possible. Pay them the £150 that you owe. Then you can argue about the rest.

 

They are not entitled to charge what amount to excessive penalties. Even if it is in the contract, they would only be allowed to charge sufficient to cover their administrative losses. Begin by paying them the £150 – even if they try to refuse to accept it they are obliged to. After that tell them to go and do the other thing in respect of the other money they want to claim. If they want to take the court we will help you defend. Your chances of success are better than 90%


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Thank you Bankfodder and Andyorch for the quick and informative responses! I'll craft a suitable response to PDC, offering to pay the original amount and drawing their attention to theirs and their client's failure to comply with the requirement to provide a summary of rights.

 

I may be back.... :)

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you dont offer, you send a cheque and if they refuse to cash it they ahve just lost themselves any chance of getting another penny in costs. read up on mitigation of losses for that bit. as siad above the 2 things are separate issues but read your lease carefully regarding paying of costs when paying ground rent or service charges late.

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A brief update. I wrote to PDC today as follows:

 

"Dear XXX,

 

I will call shortly to make payment of the outstanding service charge of £150 - this amount has never been in dispute.

I have written to your client on two separate occasions since the demand for an increased payment amount was made, requesting both details of the specific clause in the lease that allows for admin charges, and a breakdown of said admin charge as I believe it to be disproportionate to the actual costs incurred.

 

Furthermore, your client (and latterly your company) has failed to provide an accompanying summary of rights, required under the provisions of the Commonhold and Leasehold Reform Act 2002.

 

As such I am exercising my right under said act to withhold payment of the initial admin charge of £34.

Given these circumstances, and considering that I have acted within my rights under the aforementioned Act, I believe your client has acted unreasonably and inappropriately in instructing a debt collection agency.

As such I do not accept liability for any additional costs incurred, over and above the original service charge.

 

Please acknowledge receipt of this email.

 

Yours sincerely"

 

I followed up with a call (recorded) and attempted to make payment of the original £150 in settlement of the original overdue amount, and was advised that they would not accept "part payment". I asked for this in writing and received the following:

 

"Good Afternoon,

 

In regards to our telephone call,

 

The amount of charges due = £150.00 (Service Charge and Reserve Fund)

 

The amount due of fees passed on by RMG = £114.00 (Due to Non Payment)

 

The amount due of our PDC fee = £150.00

 

Due to Non/Late payment you are laible as per the terms in your lease to pay these.

 

Unfortunately we will not take payment minus these fees.

 

Kind Regards,"

 

RMG (and PDC) have failed to provide the summary of rights required by the 2002 Act and PDC have now refused payment, thereby failing to mitigate their losses. Is this a fair summary?

 

If this is correct, should I just wait it out or would it be advisable to attempt to pay the £150 direct to RMG??

 

As always, any advice gratefully received.

 

C

Edited by dx100uk
spacing

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Retain that safely...they cant litigate now as they have refused payment and you have it in writing.

 

 

Andy


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Retain that safely...they cant litigate now as they have refused payment and you have it in writing.

 

 

Andy

 

Thanks Andy. So would you suggest I wait it out?

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Yes...if they think their charges are justified and can refuse payment...let them bring a court claim on.

 

You will have to think of another way to make this payment..possibly bypassing them.

 

 

Andy


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Received an email response today:

 

"Good morning,

 

 

 

I believe you have called our office since sending this email and have been advised by one of my colleagues that we are unable to accept part payment of the outstanding arrears and that the amount is due to be paid in full.

 

 

 

With regards to the fees, you are liable to pay these for non-payment of charges due as per the terms of your lease. I have attached a copy of the lease and would like to refer you to Schedule 5, Part 1 – Covenants enforceable by the landlord, Point 1 & 3.

 

Our client has fulfilled their obligation by sending you an invoice for payment. It is your responsibility to ensure payment is made and on time, due to non-payment further fees have been incurred and subsequently referral to Property Debt Collection and further incurring fees.

 

 

 

Please call our office within 7 days to make payment of the outstanding balance of £414.00"

 

 

As far as I can tell, this doesn't change anything for a number of reasons:

 

1. Clauses 1 and 3 (see attached pic) make no reference to admin fees (although I suppose it could be implied?)

2. Even if they did, there was no accompanying summary of rights

3. They are explicitly choosing not to mitigate their losses.

 

Can anyone confirm my thinking is correct?

 

Cheers

Chris

lease1.JPG

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There was no need to pass it to a Debt Collector ...I wouldn't regard that as a legal fee.


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 Have we helped you ...?         Please Donate button to the Consumer Action Group

 

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Thanks Andy, totally agree.

 

I'm going to write back and offer to pay the original £150 plus the late payment "admin" fee of £34, simply because I value the time it will take me in carrying on with this nonsense at more than £34.

 

If they don't accept it, I'll contact RMG direct and try the same tack.

 

If that doesn't work, I'll await their LBA.

 

Thanks

Chris

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