Reasonable Costs associated with RTM Claim

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  • Benzo
    replied
    It's so frustrating that this FH could use the argument that the claim does not identify the premises when his company are responsible for the Appeals Court decision which led to RTM not being applicable for multi block claims in the first place. If that hadn't happened we could simply use the definition in the lease, which defines the estate, not each individual block.It's HIS legal teams which have created this issue; RTM claims are just trying to adhere to the fallout from that decision.

    It's the legal equivalent of driving into someone then suing them for denting your bodywork.

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  • betpharaoh
    replied
    Grendel, apologies for not replying sooner. Unfortunately the details of our FTT judgement are not yet publicly available.

    Regarding my specific case, the freeholder has now applied to the Tribunal for determination of costs seeking total costs of ~£1,900. We counter offered ~£1,400 to which they've given us 1 week to accept the sum of £1,600. Again, any thoughts/advice on whether there is merit in pursuing this further would be gratefully received.

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  • Grendel
    replied
    Good point, Chris - though as a normal human being I'd argue that wasn't reasonable. But we're not dealing with normal human beings. Mind you, if they paid it and I had to pay it back, there'd be no net loss to me, but at least they'd suffer the delay and some of the annoyance I have to go through jumping through pointless hoops.

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  • chris1544
    replied
    I couldn't agree more. For small properties there is definitely more work involved on the side of the leaseholder in preparing the various notices etc then there is for the landlord's solicitors.

    I forgot to mention in my earlier post but with regard to charging the solicitors for the information, you could do that but you should bear in mind that you will be paying the landlord's reasonable costs in dealing with the claim.

    Therefore what is likely to happen is whatever you charge will be charged back to you in the bill you receive, possibly with admin fees added on top for making the payment.

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  • Grendel
    replied
    Cheers, Chris1544, that's the direction I'm leaning. I just worry they'll then come back with something equally trivial they've been saving. And I do strongly object to the fact that I'm getting a huge bill from them for interfering in what should be a straightforward changeover, and at the same time, I have to do all the work.

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  • chris1544
    replied
    It's a bit strange that having sent a new notice of claim with the changes made that they are now asking for proof that the changes have been made. Surely the notice of claim is itself the proof?

    Maybe they want to see the register of members for the company to see if the other flat has been correctly recorded as a member. I would just supply the information they've asked for.

    It's annoying but I suggest that the focus now should be on getting the claim through without further challenge and if this is all they need to satisfy themselves that it's a valid claim then it may be worth doing.

    Also I assume that the bill you've already received was for their work in dealing with the claim that was withdrawn? In which case I think that you will receive another bill for their handing of the new notice of claim.

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  • Grendel
    replied
    Macromia and Gordon999. I really appreciate your help with this. It continues.

    Having withdrawn the original notice and served a new one with the changes made (even though the consensus on this forum appears to be that they were not needed), the management company have gone straight back to the solicitors who are now demanding I supply them with proof that the changes have been made, also proof that the invitation to join the company was presented properly to the third flat (I've got the registered letter receipt and a copy of the letter). I can't see any reason for this other than that they've deliberately held it back in order to delay further (otherwise it's another strike against their competence).

    I now envisage them trying to charge again for their services. I'm in a bit of a quandary what to do next. They haven't actually issued a counter notice, so I'm wondering whether to: 1. Sit tight hoping the notice's one month deadline passes without a counter notice, but ready to go to tribunal if one appears. 2. Tell them to do it themselves. 3. Provide the information they request and demand an end to it. 4. Invoice them for 3 (as far as I can see, I may be obliged to provide that information, but I can't see anywhere I have to provide it for free.)

    Any feelings on this? At the moment I feel like I'm being driven into a corner.

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  • Gordon999
    replied
    Grendel,

    The RTM company with 2 directors should be legally acceptable. What matters is that both flats should be members of the RTM company and all the leaseholders have signed some list/sheet to show the freeholder that they support the claim for right to manage of their own money held in the service charge bank account.

    If you have some evidence for complaint against a solicitor, make a complaint to the SRA ( Solicitors Regulation Authority ).

    The Fraud Act 2006 Section 4 ( Fraud by abuse of position ) may apply in your situation of having to pay £900 extra ..

    Leave a comment:


  • Macromia
    replied
    This thread doesn't go into betpharaoh's case in sufficient detail to either show that a relevant precedent has been set, or to enable the case to be easily found.

    You don't need to have one director per flat (two directors could act on behalf of all the flats in a block), I just wouldn't like the idea of one flat having two directors votes - especially when that is enough to give them control of a quorum of all directors.

    You should have told the solicitor that they were wrong regarding the directors.
    Whether they have a point or not regarding identification of the property is another matter, and I think that it should be fairly easy to convince a tribunal that this objection falls under the "technical points which are of no significant consequence to the objector" mentioned in this Court of Appeal case:https://www.bailii.org/ew/cases/EWCA/Civ/2017/89.html

    The specific errors dealt with in this case are different, but I think it could be argued that the principle applies (the freeholder must know what property is being referred to if he knows that one of the leases within the property is jointly held).

    If any additional solicitors fees are charged because you changed the application following their objection to the named directors, I think you have a good argument that these are unreasonable (especially as one of the couple who jointly own the lease would be able to resign as a director immediately that the RTM was granted).

    Leave a comment:


  • Grendel
    replied
    I didn't find the formal tribunal decision, Macromia, just the reference on this site. I see no reason why a solicitor couldn't do the same, then use their knowledge to follow it up to source though.

    Regarding the directorship, I was thinking along the same lines when I put the company and notice together - one director per flat. Looks like I've been led down the garden path by a devious solicitor and am now going to have to stump up nine hundred quid for the pleasure. It wasn't advice, by the way, it was the grounds for the counter notice, along with the address of premise thing.

    Leave a comment:


  • Macromia
    replied
    Originally posted by Grendel View Post
    My feeling is that anybody charging £300 an hour should be responsible for the activities of their underlings. Passing the buck down the line is scurrilous, and far too often used by senior management.
    I would tend to agree - but you would still need to demonstrate incompetence, which may be very difficult to do.


    Originally posted by Grendel View Post
    As for not knowing about recent relevant FTT decisions - well I found it in ten minutes, and I'm a layman and not being paid through the nose. I think that makes it totally reasonable, but I understand where you're coming from. It's probably the way a tribunal would think.
    You found the tribunal decision from betpharoah's case? How do you know that it was that particular decision when (as the rules of this forum require) the freeholder has not been identified and
    betpharoah is not using their real name?
    Besides, you need to take into account the fact that even small differences in the facts of a case can mean that it is decided that precedent from previous cases doesn't apply (especially when the precedent isn't binding because it doesn't come from a decision by a higher court).

    It is reasonable to assume that a competent solicitor will know that there have been prior tribunal decisions relating to the same issue, unless they are very recent, but that may not mean it is unreasonable to challenge the RTM.


    Originally posted by Grendel View Post
    Regarding the joint leaseholders, the solicitor said that joint leaseholders must act as one. Originally on the notice there were just the two directors of the company listed (two flats out of three), myself and one from the flat above. The solicitor insisted that as the guy upstairs was a joint lease holder, his vote didn't count without his partner being a director too, and therefore the notice was invalid as only my flat out of the three counted. It took me ten minutes to register his partner, but couldn't really see any alternative then but to withdraw the notice and issue a new one. I have a horrible feeling the landlord will now start the process afresh and dump us with a whole new solicitors' bill.
    Is this advice that was given only by the freeholder's solicitor?
    I would think that you have been wrongly advised here. Joint leaseholders will jointly own a share in the RTM but there is no reason whatsoever why both would have to be registered as directors of the company. I would suggest that it may be better not to have them both registered as directors. With both of them as directors they will have full control over any RTM company decisions that are decided by the directors because they can out vote you whenever they wish.
    As members of the company they would only have a single vote between them, so why should they be given two votes in a qurom of directors by making them both directors?

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  • Grendel
    replied
    Macromia, thanks for that. My feeling is that anybody charging £300 an hour should be responsible for the activities of their underlings. Passing the buck down the line is scurrilous, and far too often used by senior management. As for not knowing about recent relevant FTT decisions - well I found it in ten minutes, and I'm a layman and not being paid through the nose. I think that makes it totally reasonable, but I understand where you're coming from. It's probably the way a tribunal would think. There's a kind of ring fence round professionals (apart from doctors - the most honest and useful of them!) that protects them far too often from answering for their failures.

    Regarding the joint leaseholders, the solicitor said that joint leaseholders must act as one. Originally on the notice there were just the two directors of the company listed (two flats out of three), myself and one from the flat above. The solicitor insisted that as the guy upstairs was a joint lease holder, his vote didn't count without his partner being a director too, and therefore the notice was invalid as only my flat out of the three counted. It took me ten minutes to register his partner, but couldn't really see any alternative then but to withdraw the notice and issue a new one. I have a horrible feeling the landlord will now start the process afresh and dump us with a whole new solicitors' bill.

    Leave a comment:


  • Macromia
    replied
    Grendel:
    In UK law any previous decisions made by a court of the same level are not necessary binding when similar cases are decided. The court will likely come to similar decisions, and follow the outcome of prior cases, but they might come to a different conclusion (especially if they consider some aspects of tge case to be different in some way).
    Also, while similar former tribunal decisions might help to sway a tribunal, it is not reasonable to expect a solicitor to be aware of all recent FTT decisions that might be relevant.

    Regarding competence, it is possible for you to get the landlords solicitors costs reduced if you can show that they did not carry out their work with sufficient competence to justify the fees charged - but you would have to make a good case.
    Mistakes in addressing letters, and receiving crumpled hand delivered letters, would likely be considered irrelevent as these tasks would be expected to have been delegated to an office secretary, not done by the solicitor. You would likely have to show that the solicitor didn't address legal aspects competently.

    I'm also curious about what you mean when you say you had to jointly register joint leaseholders as directors.
    Do you mean that you registered them both as separate directors?

    Each property should have equal decision making and voting rights in the RTM company, regardless of how many leaseholders share the lease. I see no reason why they would have to be jointly registered as directors.

    Leave a comment:


  • Grendel
    replied
    betpharaoh, I'm really interested in your case. I'm in the process at the moment and the landlord's solicitor has come up with exactly the same complaint that the premise has not been identified. Unfortunately, I also fell foul of the fact that the leaseholders of the other flat held it jointly, and, not realising they had to act as one, I only registered one of them as a director of the RTM, otherwise, having seen your post, I'd have yanked them straight off to tribunal and used your case as precedent. Really annoying, but it meant having to withdraw the notice and immediately issue a new one with the corrections made.
    However, it has brought up an interesting point regarding the solicitors' costs (which they've invoiced for VERY quickly). Although employed by the landlord, as we have to pay the bill, don't we have rights regarding the competence of said solicitor, especially as they're charging hundreds of pounds an hour? As precedent is the fundamental basis of the English legal system, throwing up the same blocking tactic as has already been dismissed in your case would constitute incompetence. As it happens, this was not the only dubious thing the solicitors did. They also made a couple of pretty basic errors in serving the counter notice. I commented to my co-director at the time we received our third copy (one by post, one by registered which didn't get to us because it had no name on it, and one by hand) that it looked like they'd given it to a junior clerk and he was getting his ears boxed.
    Anyway, does anybody know where we'd stand challenging the costs on the grounds they were at the rate for a skilled professional, but the service received was not of sufficient competence to justify that?
    Also, betpharaoh, do you know if the details of your judgement are on line anywhere? I'd love to wave a copy in their face.

    Leave a comment:


  • Macromia
    replied
    Originally posted by Gordon999 View Post
    Just had a look at C&LRA 2002 section 88( 3) and copy shown below :
    ...

    I read this clause S88(3) to mean "the RTM is liable for landlord's legal costs only if the application by RTM has been dismissed by the FTT".
    Yes - but look at section 88(1) and 88(2).

    Leave a comment:

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