Late payment interest

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    Late payment interest

    I have a lease and the landlord is claiming interest in a county court claim on what he considers to be late payments. No demands have been issued, no notice of tenants rights have been received, The lease says interest is payable at 4% above base rate on amounts which are 14 days overdue. The solicitors say that the landlord does not have to demand interest, it is a penalty to which he is contractually entitled. Is that right?

    #2
    Was there a valid demand for the service charge, itself? The 14 days cannot start until that demand is properly issued.

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      #3
      Note that 4% above base rate is less than 0.1% per week, so hardly worth a big argument unless the original demand was invalid, or you are many months late.

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        #4
        Thanks for the prompt reply. There is a dispute over the service charge demands which will affect any calculation, but I am more interested in the principle of whether or not a demand for interest needs to be issued with the required notice or it can be avoided by the landlord applying directly to the court.

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          #5
          Originally posted by leaseholder64 View Post
          Note that 4% above base rate is less than 0.1% per week, so hardly worth a big argument unless the original demand was invalid, or you are many months late.
          It may well double the size of the claim -- based on the related post these seem to be outstanding for a decade or so. 4% above base rate compounded will be an approximate doubling.

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            #6
            Moderator2 this poster has asked three trivial questions on the identical topic in different threads which should probably be merged. OP you will do a liot better to tell the whole story/scenario in one post -- not small legal trick questions (this is not how this forum works).

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              #7
              Please excuse my ignorance if I am wrong to start different threads, They may seem trivial points to you but they are not to me.

              The landlord has not produced details of his calculation and it will need to be changed anyway because at least part of his claim is incorrect. The claim is difficult to understand after all this time.

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                #8
                What the lease allows with regard to interest for late payment could potentially be a minimum that is claimed if you lose a court case.
                The freeholder could potentially ask for interest to be added at the court rate if they win the case (currently 8% above base rate, I believe). With interest rates still low they stand more chance of being awarded interest if they stick to requesting the amount detailed in the lease though.

                The statement of rights for administration charges would have to have been included if a service charge demand that requested payment of interest had been sent out, it does not have to have been sent if the interest has not actually been demanded but the freeholder intends to ask the court to award this.

                I agree with AndrewDod regarding merging of threads.
                If you have similar related queries it is probably best to include them in a single thread (one of these that has already been started).

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                  #9
                  Thanks for the replies. Once again, I apologise if I ought to have included different subjects in one single thread,

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