Freehold Managers Unreasonable Fees for Subletting Consent

Reply to the comment left by “Ollie Cornes” at “02/12/2013 – 10:51“:

Hi Ollie

Please see the link I have posted.
.

Reply to the comment left by “Rob walsh” at “02/12/2013 – 11:01“:

If it says “no less than £50+vat” then that’s a minimum, not a maximum. That sort of wording is very standard. If I paid that minimum, I’d expect the freeholder to cry breach.

Reply to the comment left by “Mark Alexander” at “02/12/2013 – 11:02“:

I’m familiar with the LKP piece, but as far as I’m aware the £40+vat rulings are not binding.

What I do not know is what the risks and time/money commitments are to dispute sublet charges via FTT. If the costs & risks are reasonable I’d do it. It seems hardly any landlords stand up to these bastards and more should. Leaseholders are being royally screwed on sublet fees, let alone service charge costs.

Reply to the comment left by “Ollie Cornes” at “02/12/2013 – 11:23“:

Ollie you say It seems hardly any landlords stand up to these b*st*rds and more should. Leaseholders are being royally screwed on sublet fees, let alone service charge costs.

But you then advise that we should just pay the charges because its not worth risking the consequences. If it says in my lease the minimum charge is £50+vat and its been said in court that a fee of £40+vat is reasonable then why should I pay anymore than the minimum of £50+vat stated in my lease?

Reply to the comment left by “Rob walsh” at “02/12/2013 – 11:31“:

I didn’t advise others to just pay, I said that’s what I currently do. I take that position as I’ve yet to understand the risks and costs of challenging them. Both LEASE and LKP have advised me against challenging them as in my case the fees aren’t too bad, but I still think they are too high and I remain very much open to going to the FTT.

Your lease says a minimum of £50+vat, so as long as they are charging something £50+vat or above, they are doing what the lease says. Your freeholder appears to have the right to charge anything reasonable they like above that figure. What is reasonable? The rulings Mark mentions are not, as far as I am aware, binding. If you want to force your freeholder to charge you £40+vat you either need them to agree to do that, or go to the FTT yourself and get a judgement. By refusing to pay what they are demanding I expect you may be in breach of your lease, which could put you in a very weak position should legal proceedings start.

We receive letters like this all the time from our Freeholders,asking us to pay varying costs relating to subletting, but the fact is our lease states what must be paid – a percentage subject to a minimum of £25 + VAT, yet still the letters arrive at least once a year asking for hundreds of pounds for consent. I set up a Resident’s Association and a number of leaseholders have since received refunds for what they had paid.

So my advice is READ YOUR LEASE!

Reply to the comment left by “Annette Stone” at “02/12/2013 – 10:42“:

hi annette
you say:
‘If there is an rtm then the question of fees for subletting etc. are not relevant and the freeholder cannot enforce them. ‘
can you please elaborate?

Joe Bloggs. If a building has formed an rtm (right to manage company) and has taken control of their building then the rtm company (and their appointed managing agent) take over all management functions and the freeholder cannot impose any license fees or make charges for anything that can come within the realms of management.

My firm has formed numerous rtms for lessees unhappy with their freeholders/management agents and one of the first things we have dealt with is obtaining refunds for fees unfairly charged. So far I have been 100% successful in getting fees refunded right the way back to the beginning of the current lessee’s ownership of the flat; in some cases several years.

thanks annette. so for instance where the lease says permission for sub letting must be obtained from the manager, if the manager is appointed by the rtm co., does that clause become nullified? is there a legal authority for that?

I would need to see exactly what the clause says. If there is an RTM they take over management functions. That is the law. I am not sure what you mean by the “manager”. Do you mean a management company as enshrined in the lease. If so, that is superceded by an RTM