Back dating Ground rent increase from 9 years ago!

by Readers Question

11:05 AM, 17th August 2015
About 6 years ago

Back dating Ground rent increase from 9 years ago!

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Back dating Ground rent increase from 9 years ago!

I own a flat that I rent out. Estates & Management  have just written to me and I just wanted your thoughts as to whether this is legal as I am fuming…back

“Following a review of the lease for the property it has come to our attention that your ground rent was due a review on 1 Jan 2006.

Your lease states that the rent for your property is to be determined by the increase in the value of the block of which your property is a part of over a period of 21 years. Accordingly your ground rent has increased to £85.25 per annum.

The current balance on your account is £625.78 and an invoice will be sent to you shortly.”

I called them to clarify the content of the letter in that they were backdating 9 years worth of ground rent that they have only just increased and they confirmed it was correct.

This doesn’t sound right…. anyone else had this? and thoughts, suggestions?

Thanks, Mark

Comments

Mark Weedon

15:45 PM, 17th August 2015
About 6 years ago

Proxima, E&M and First Port are all connected to Peveral. If you search the internet you will find loads of things about what they get up to. I doubt you will be impressed.

Mark Lynham

16:49 PM, 17th August 2015
About 6 years ago

oh i have enough dealings with all of them so i know exactly what they're like....

Chris Amis

19:15 PM, 17th August 2015
About 6 years ago

You have another possible problem, when you next pay service charges, they may just apply these to the ground rent and then demand the rest of the missing service charges, maybe with late fees.

Then it is pay up and challenge or risk unlimited costs as they take action preparatory to forfeiture (look to see f your lease mentions this, often relates to "section 146").

It is all rubbish of course, but legal action is a lottery with a downside way beyond the original disputed cost.

Michael Barnes

21:59 PM, 17th August 2015
About 6 years ago

If a review was due 1 jan 2006, it seems to me that they had their chance to review and increase if seen fit, and either decided that an increase was not appropriate or have missed their chance, and should now wait until the next review date.

of course it depends on the exact wording in your lease.

Mark Lynham

9:40 AM, 18th August 2015
About 6 years ago

and 2 days later i get the invoice for settlement... Ground rent adjustment due 01 jan 2006 £625.78...

Mark Lynham

12:11 PM, 18th August 2015
About 6 years ago

had this in from the people Neil recommended..

Dear Mr Mark Lynham,

Thank you for your enquiry of 17/08/2015.

Please note that case law suggests that time is not of the essence where the landlord fails to serve notice on the tenant of their intention to implement a rent review by the date specified in the lease. In the case of United Scientific Holdings V Burnley BC [1978], the House of Lords held that time is not generally of the essence unless; the terms of the lease expressly provide that time should be of the essence or if the terms of the lease indicate that time is to be of the essence or the surrounding circumstances indicate that time is to be of the essence. In this case, the landlord triggered the rent review two months late, and they were entitled to the rent review.

In the case of Bello V Idealview [2009] EWHC 2808 (QB), the rent review was implemented 13 years later.

The new rent decided under a rent review clause takes effect retrospectively from the date the rent review was allowed under the lease terms, but the arrears do not have to be paid until the next rent date after the new rent is agreed or awarded, unless the lease otherwise provides.
The case of South Tottenham Land Securities v R & A Millett (Shops)[1984] 1 WLR 710, states that the landlord cannot issue proceedings to recover the back payments of the increased rent until the next rent date.

It will appear that your landlord will be entitled to backdate the demand to the review date of 1 January 2006, but any demand for payment of the arrears will be made on the next rent date and not earlier.

.... lovely..

Connie Cheuk

13:54 PM, 18th August 2015
About 6 years ago

Reply to the comment left by "Mark Lynham" at "18/08/2015 - 12:11":

Yep, it's all about the lease, about the lease, about the lease...

I would just see whether you can arrange the repayments in instalments (without incurring interest) so that it doesn't hit your pocket in one go.

Sorry to hear that, but this is the reason I am selling the leasehold property. It is a lot like renting and not owning.

Mark Lynham

14:34 PM, 18th August 2015
About 6 years ago

Reply to the comment left by "Connie Cheuk" at "18/08/2015 - 13:54":

i have a few other leaseholds that are council freeholders who are fine to be fair, its just ones like OM etc that are the pains as they just want to squeeze as much out of you as they can... but like you say it is a lot like renting and not owning... i plan to sell a few of my leashold ones to pay off some of my freehold mortgages as im just feeling more and more uncomfortable having mortgages...

Connie Cheuk

15:19 PM, 18th August 2015
About 6 years ago

Reply to the comment left by "Mark Lynham" at "18/08/2015 - 14:34":

Especially with the new Budget announcements, I know what you mean. I'm pleased that I've found a buyer. I much prefer having control over maintenance costs, etc. Plus I'm paying the Landlord's admin fee! Give over! It's his own company.

Have you been part of the campaigning on here? There's been all sorts going on to try to reverse the proposal.

Mark Lynham

15:31 PM, 18th August 2015
About 6 years ago

Reply to the comment left by "Connie Cheuk" at "18/08/2015 - 15:19":

i've been watching it and know Mark has been invited along to share his views on the matter... worrying times... im a landlord and im a letting agent so all good! lol

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