The true costs of taking a management company to 1st tier tribunal

by Readers Question

11:28 AM, 25th August 2016
About 2 years ago

The true costs of taking a management company to 1st tier tribunal

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The true costs of taking a management company to 1st tier tribunal

The true costs of taking a management company to 1st tier tribunal

I have just had a very traumatic experience after taking a freehold management company to 1st tier tribunal over a costs dispute.

This is my story of how winning £800 cost me over £14,000.

In 2014 I took a managing agent to a 1st Tier Tribunal and they were ordered to repay unreasonable service charges. The tribunal made a No Costs order.

Great I thought, I will get money back and move on….. No chance!

I received a County Court Summons alleging I owed Ground Rent and Service charges and fees. The managing agents refused to provide service charge summaries and refused to provide accounts.

I know – what does the lease say – yep lease says we have to be provided with a summary, no chance!

What about S21 & S22 LTA 1985? That does not exist nor does, 152 Common hold Leasehold Reform Act. What about ARMA – nope. RICS, IRPM has no requirement to follow their code of practice. They can charge what they like and don’t have to account how they spend lessee’s money– so suck it up!

However, I have copies of all my bank statements and cheques gong back 9 years. I do not owe service charges or ground rent. Easy case to win I thought – I can prove what I paid, now you prove I owe it!

No need – apparently they claimed I owed £850 legal fees from the 1st Tier Tribunal – ah but the tribunal ordered no costs.

Apparently there was a case in the high court Chaplair Ltd v Kumari that basically said regardless of the outcome of any case before the courts or tribunal the management company was entitled to recover its costs if it says so in the lease so I have to pay these £800 solicitors costs and just got hit with another £10,200 of legal fees + VAT for trying to defend myself. I’m now looking at a bill of £14k for a bill of £800 in a small claims court! This totally wipes me out!

So for all those people wanting to dispute service charges ground rent and administration fees in a 1st tier tribunal or court, don’t, just pay up, you can’t win!

The management companies and their solicitors have a licence to print money and of course if you loose (and you will), they will hit you back hard for daring to challenge them.

This is nothing but a protection racket!

Pay us what we think you owe, if you don’t we’ll give it to a solicitor and win or lose we’ll bung it on your account and come after you again and the court must find in our favour.

Of course some would say scumlords deserve it, however my wife bought this flat when she was diagnosed with cancer. She wanted to give our kids a step on the housing ladder. She died 12 months ago so can’t really claim that we were professional landlords under any stretch of the imagination.

Me – what am I going to do, sell it as soon as possible, probably at a loss, re-mortgage my home to pay these costs, then of course fall back on the training I received in the armed forces and ……………. well no need to go into details.

Now the company responsible for this scam was Trinity Estates, the thieving lying solicitors JB Leitch – if you have anything to do with these thieves’ liars and scumbags – sell up asap.

You have been warned – Ian



Comments

Seething Landlord

12:58 PM, 25th August 2016
About 2 years ago

Moderators - please check the final paragraphs of this article, which may contain veiled threats and/or libellous statements.

David Atkins

13:28 PM, 25th August 2016
About 2 years ago

Right to manage would be the professional course of action.

Ian Ringrose

13:34 PM, 25th August 2016
About 2 years ago

Yet anther reason to avoid leasehold.....

Clint

14:09 PM, 25th August 2016
About 2 years ago

A few years ago, I challenged service charges of around £1800 at what was then called the Leasehold Valuation Tribunal. I won the case and the service charge was reduced to around £400. After a few weeks I received a bill totalling around £2700 which was mainly for the solicitor's costs which was charged at the rate of £230 per hour where he even did his own photocopying and charged £230 an hour for the time taken (I cannot understand how the tribunal could accept this).

To cut a long story short, I appealed against the cost after taking much legal advice and ended up with court costs amounting to around £4700. The next step was to appeal to the Lands Tribunal which I decided not to do and just paid up.

I believe one could apply for a variation of the lease at that point but I am not sure if that is correct or not. So all in all think twice before applying to the First Tier Tribunal as it all appears to me to be in favour of the Freeholder.

Charles King - Barrister-At-Law

14:55 PM, 25th August 2016
About 2 years ago

Thank you for highlighting this Ian. May I sincerely apologise on behalf of the legal profession. There are a few more names I could mention who make a living out of this dirty business. It's just so obviously wrong. The law has to be reformed by Act of Parliament. Obviously anybody else faced with this should read the part of their lease referring to the recovery of costs by the landlord very carefully. You can win, but you have to be very careful indeed.

Mark Alexander

13:33 PM, 26th August 2016
About 2 years ago

Reply to the comment left by "Seething Landlord" at "25/08/2016 - 12:58":

Our stance on defamation and libel can be read here >>> https://www.property118.com/what-property118-is-not/

Ian's post is based on a real case. If we receive a complaint from the businesses mentioned by Ian then we will be happy to provide them with Ian's contact details. There is case law confirming that such action removes our liability.

I am not sure what you mean by veiled threats. If you are referring to "armed forces training" then I would take that to mean that Ian would remain calm and collected and that he no longer bears arms.

David Atkins

15:08 PM, 26th August 2016
About 2 years ago

Of course if said is proven true, then there is nothing to worry about.

David Mensah

9:30 AM, 27th August 2016
About 2 years ago

Hi Ian,

So sorry to hear about your story -- unfortunately it gets repeated around the country. Leasehold law in the UK desperately needs to be completely overhauled.

You may want to get in touch with the people at Carlex http://www.carlex.org.uk -- while their main fight is about retirement homes, they also campaign effectively on more general leasehold issues.

Kate Mellor

12:16 PM, 27th August 2016
About 2 years ago

There seems to be such a lot of pressure on conveyancers these days to churn through huge caseloads that they make many, many mistakes. Also the focus seems primarily on protecting the lenders interests more so than the purchaser.

This clause in the Lease whereby the Leaseholder is obligated to pay the Freeholders legal fees regardless of the outcome seems to be clearly an unfair term and as such should have been highlighted as a problem by the purchasers solicitor in an ideal world.

Also it may well be invalid on this basis, but really who can afford to follow this any further thereby increasing potential losses with their own as well as the freeholders further legal fees???!! Certainly not Ian by the sound of it!

Seething Landlord

16:39 PM, 27th August 2016
About 2 years ago

Reply to the comment left by "Mark Alexander" at "26/08/2016 - 13:33":

"veiled threat": yes I was referring to "then of course fall back on the training I received in the armed forces and ……………. well no need to go into details."
If referring to named solicitors and companies as " thieves’ liars and scumbags" is not defamatory I don't know what is, but if you are satisfied that Property118 has no potential liability as publisher of the libel, so be it.

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