Ground Rent and Service Charge Demands

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    Ground Rent and Service Charge Demands

    If demands are never received for both ground rent and service charges, are they ever due?

    I read somewhere that they are up to 6 years, if they have been demanded. Is that correct? If they have never been demanded, can I have read somewhere that landlord has up to 18 months to demand?

    Either way, what is the correct and lawful position for a lessee?

    #2
    Ground Rent demands can be (re)served upto 6 years later, beyond this date..no they are not payable.

    The limit for Service Charges is 12years (although some maybe 6 in some circumstances if SC is reserved as rent), the 18 month rule doesnt apply to demands but to notifications that FH has incurred a cost.

    Its explained here - https://www.lease-advice.org/case-st...18-month-rule/
    Advice given is based on my experience representing myself as a leaseholder both in the County Court and at Leasehold Valuation Tribunals.

    I do not accept any liability to you in relation to the advice given.

    It is always recommended you seek further advice from a solicitor or legal expert.

    Always read your lease first, it is the legally binding contract between leaseholder and freeholder.

    Comment


      #3
      I assume you mean never served, rather than never received.

      To be valid, they have to be served properly, according to the terms of the lease, and in the case of ground rent, in a legally prescribed form, and in the case of service charges, accompanied by a legally prescribed statement of rights.

      They become due once the demand is properly served subject to the time limits above.

      Notices that expenditure has been incurred have to be served properly.

      E.g. if you are sub-letting, and have not provided an acceptable service address, other than the property, and the tenant fails to forward the notices, the payment is still due. Proof of posting will also tend to confirm service.

      Comment


        #4
        "Notices that expenditure has been incurred have to be served properly."

        Not quite true..this notice has to be written but can in theory be on the back of a fag packet, its only the actual later demand that has to comply with umpteen rules.
        Advice given is based on my experience representing myself as a leaseholder both in the County Court and at Leasehold Valuation Tribunals.

        I do not accept any liability to you in relation to the advice given.

        It is always recommended you seek further advice from a solicitor or legal expert.

        Always read your lease first, it is the legally binding contract between leaseholder and freeholder.

        Comment


          #5
          Does that mean if the agent takes some money from the trust account and you later discover it, they have up to 12 years to demand what they took?

          Comment


            #6
            Originally posted by paulamis View Post
            Does that mean if the agent takes some money from the trust account and you later discover it, they have up to 12 years to demand what they took?
            No. It means you have 12 years in which to require them to return it to the trust account.

            Comment


              #7
              Thanks all. In my case, my freeholder does not serve demands for either. I have continued to pay GR, but I cannot pay SC because I do not know how much it is. It is a proportion of the Buildings Insurance and nothing more. I will ask freeholder, as I want to know the building is insured properly.

              Comment


                #8
                The situation with ground rent used to be that you had to pay it, whether demanded or not, so there was a scam, whereby freeholders let it lapse and then made big charges to remedy the situation. Legislation was introduced to counter this, with the result that, unless ground rent is demanded, and that is done in a very specific way, it is not due.

                For service charges, as you say, if you are not told what they are, you cannot reasonably be expected to pay them.

                My original caveats where that the freeholder only needs to use the information they know about you to serve the demands. They are still valid if you hide from them.

                Comment


                  #9
                  In my case, we live in the same building, so no trouble locating me.

                  So, I understand then, that the freeholder has up to 12 years to retrospectively serve the SC demands. In which case, I better open a separate bank account and put money by for this.

                  Comment


                    #10
                    Only to the extent that they told you that would, eventually, be billed, within the 18 month limit.

                    There are two limits here: there is a statute of limitation on debts relating to contracts made by deeds (12 years) and there a limit in which service charge payers must be made aware of costs for them to be recoverable through the service charge (18 months). Theoretically, they could have incurred a cost 11 years and 11 months ago, and told you about it immediately, but not invoiced you until today.

                    Comment


                      #11
                      I finally get it. Thank you.

                      Comment


                        #12
                        Yes well explained by leaseholder64, see my post #4, the FH only has to tell you cost incurred within 18 months (note, incurred, normally means the date he actually paid for the service/supplier but there are variations)..this has to be written but doesnt have to follow any set format.

                        And as mentioned he could wait nearly 12 years to actually demand it (this demand must follow specific formats), although the lease may impose other date deadlines, there also are cases where courts/FTT impose the 6 years deadline, either coz its service charges reserved as rent or they were just plain wrong.
                        Advice given is based on my experience representing myself as a leaseholder both in the County Court and at Leasehold Valuation Tribunals.

                        I do not accept any liability to you in relation to the advice given.

                        It is always recommended you seek further advice from a solicitor or legal expert.

                        Always read your lease first, it is the legally binding contract between leaseholder and freeholder.

                        Comment

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