We have longstanding expertise in acting for landlords selling or transferring freehold residential or mixed use blocks. Contact our team on 01225 462871. Alternatively, you can email, or complete the contact form at the foot of this page.
Service charge disputes
Service charges are payable by tenants to landlords for services the landlord must provide under the terms of the lease. Typically, they cover such things as maintenance and repair costs, buildings insurance and management costs.
The lease sets out details of service charges and its wording defines what is and what is not recoverable from the tenant. Unlike in residential property leases, there are no terms implied that the service charges must be ‘reasonable’. Neither are there statutory consultation procedures for major works.
“Your ability to steer us through this minefield was truly impressive. Thank you.” GT
Where a landlord or tenant stands in a service charge disagreement largely depends on the lease wording. Often, tenants must pay a sum in advance following the preparation of the landlord’s estimate. A demand for a balancing payment is sent at the end of the accounting year if the actual expenditure exceeds the estimate.
Poor lease drafting
If the lease terms are unclear, things can quickly become difficult, particularly when the parties are each working on the basis of their own interpretation. That was the scenario in the widely reported case of First Property Services Ltd v Ahmet, where a poorly drafted lease resulted in an expensive outcome for the leaseholder.
Typical disputes revolve around allegations of:
- failure to follow the procedures set out in the lease;
- charges levied to pay for services not covered by the lease;
- substandard maintenance and repair work;
- interruption to the tenant’s business by the landlord’s works.
“Thank you for your advice, your prompt action and your persistence.” JF
Whether you are a landlord or tenant, a service charge disputes are unwelcome. We will advise where you stand legally, and devise the best course of action based on your needs and objectives.