DEMANDS
In order to be effective and enable recovery of the monies demanded, the Service Charge demand served upon the Leaseholder must:-
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Be in writing
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Contain the name and address of the Landlord (If the Landlord’s address is outside England and Wales then it must also contain an address within England and Wales where notices can be served upon the Landlord)
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Must also provide the Leaseholder with an address in England and Wales where notices can be served upon the Landlord
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Be accompanied by a Summary Rights and Obligations (see below)
If no such Summary is provided then the Leaseholder is entitled to withhold payment until such Summary has been provided and any provisions contained within their Lease relating to non-payment or late payment (such as interest being payable) will not apply
THE 18 MONTH RULE
Service Charge demands must be made within 18 months of the expense being incurred (Section 20B of the Landlord and Tenant Act 1985)
If such expenditure has not been demanded within such 18 month period then it will not be recoverable unless you have been issued with a notice during such period informing you that such expenditure has bene incurred and that you will be required to contribute towards such expenditure
SUMMARY OF RIGHTS AND OBLIGATIONS
The form of the Summary of Rights and Obligations is laid down by Statute and must be in legible in a typewritten or printed form of at least a 10 point font. The current form of wording for use in England is as follows (there is a different format for use in Wales, using both Welsh and English) is as follows:-
SERVICE CHARGES – SUMMARY OF TENANT’S RIGHTS AND OBLIGATIONS
(1) This summary, which briefly sets out your rights and obligations in relation to variable service charges, must by law accompany a demand for service charges. Unless a summary is sent to you with a demand, you may withhold the service charge. The summary does not give a full interpretation of the law and if you are in any doubt about your rights and obligations you should seek independent advice
(2) Your lease sets out your obligations to pay service charges to your landlord in addition to your rent. Service charges are amounts payable for services, repairs, maintenance, improvements, insurance or the landlord’s costs of management to the extent that such costs have been reasonable incurred
(3) You have the right to ask the First-tier Tribunal to determine whether you are liable to pay service charges for services, repairs, maintenance, improvements, insurance or management. You may make a request before or after you have paid the service charge. If the tribunal determines that the service charge is payable, the tribunal may also determine:-
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who should pay the service charge and who it should be paid to
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the amount
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the date it should be paid by, and
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how it should be paid
However, you do not have these rights where:-
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a matter has been agreed or admitted by you
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a matter has already been, or is to be, referred to arbitration or has been determined by arbitration and you agreed to go to arbitration after the disagreement about the service charge or costs arose, or
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a matter has been decided by a court
(4) If your lease allows your landlord to recover costs incurred or that may be incurred in legal proceedings as service charges, you may ask the court or tribunal, before which those proceedings were brought, to rule that your landlord may not do so
(5) Where you seek a determination from a First-tier Tribunal, you will have to pay an application fee and, where the matter proceeds to an oral hearing, a hearing fee, unless you qualify for fee remission or exemption. Making such an application may incur additional costs, such as professional fees, which you may have to pay
(6) The First-tier Tribunal and the Upper Tribunal (in determining an appeal against a decision of the First-tier Tribunal) have the power to award costs in accordance with Section 29 of the Tribunals, Courts and Enforcement Act 2007
(7) If your landlord:-
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proposes works on a building or any other premises that will cost you or any other tenant more than £250 or
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proposes to enter into an agreement for works or services which will last for more than 12 months and will cost you or any other tenant more than £100 in any 12 month accounting period
your contribution will be limited to these amounts unless your landlord has properly consulted on the proposed works or agreement or a First-tier Tribunal has agreed that consultation is not required
(8) You have the right to apply to a First-tier Tribunal to ask it to determine whether your lease should be varied on the grounds that it does not make satisfactory provision in respect of the calculation of a service charge payable under the Lease
(9) You have the right to write to your landlord to request a written summary of the costs which make up the service charges. This summary must:-
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cover the last 12 month period used for making up the accounts relating to the service charge ending no later than the date of your request, where the accounts are made up for 12 month periods, or
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cover the 12 month period ending with the date of your request, where the accounts are not made up for 12 month periods
The summary must be given to you within 1 month of your request or 6 months of the end of the period to which the summary relates whichever is the later
(10) You have the right, within 6 months of receiving a written summary of costs, to require the landlord to provide you with reasonable facilities to inspect the accounts, receipts and other documents supporting the summary and for taking copies or extracts from them
(11) You have the right to ask an accountant or surveyor to carry out an audit of the financial management of the premises containing your dwelling, to establish the obligations of your landlord and the extent to which the service charges you pay are being used efficiently. It will depend upon your circumstances whether you can exercise this right alone or only with the support of others living in the premises. You are strongly advised to seek independent advice before exercising this right
(12) Your lease may give your landlord a right of re-entry or forfeiture where you have failed to pay charges which are properly due under the lease. However, to exercise this right, the landlord must meet all its legal requirements and obtain a court order. A court order will only be granted if you have admitted you are liable to pay the amount or it is finally determined by a court, tribunal or by arbitration that the amount is due. The court has a wide discretion in granting such an order and it will take into account all the circumstances of the case