Freeholder management company advice

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    Freeholder management company advice

    I own a leasehold flat in London. I will give a brief outline of my issue.

    In 2017 i began to have problems with water coming in from the flat roof above my apartment. I told the management company and for three months they did nothing about the problem, In December 2017 water started to enter the flat at a worrying level. I spoke to the management company and they told me that I should look for a local roofer and get the issue resolved. I would have to pay for the work but they would then bill the other leaseholders and pay me back. I found someone and the management company spoke to them and authorised the work.
    I paid the bill and the management company billed the other leaseholders. Some paid but some did not. Between 1 year and 18 months after, it was found that the work was not up to standard and it would need to be redone. The roofer who did the work has disappeared so another would have to be found.
    The management company is now claiming that that the original work was done on a sub contract basis and so I will have to repay the money that I have received from some leaseholders and that, until I have done this, the new repairs to the roof will now be done.
    My opinion is that;

    A) As they were not repairing the roof in 2017 I had no option but to try to organise it myself. I was simply reacting to their inaction and, given the emergency situation, I can not be held respoinsible for this.

    B) They still have an ongoing duty to repair my roof, now, and so are in breach of our leasehold agreement by not doing so. The dispute about the 2017 work should be separate from the current one.

    I don't know how right I am, legally, and I would greatly appreciate any advice.

    Thanks, in advance.

    #2
    The norm' is : -

    The management company look after all repairs, and initiate all repairs, and not the leaseholder.
    Your lease will state the freeholder is to maintain the roof and he issues service charge demands for work that has to be done.

    The management company should deal with all of this, and not you.

    Comment


      #3
      Hi Ram. Thanks for that. Given what I've said though, how accurate, or not, are the two points that I would like to make to them?

      Comment


        #4
        Read your lease.
        It will say somewhere ( similar items are not always in the same place in a lease, so read all of it )

        THE LESSOR HEREBY COVENANTS with the lessee ( you ) to maintain and keep in good and substantial repair and condition, the roof, sewers, drains, forecourt, main structure of the building, etc, etc.

        Somewhere else it will mention service charges.

        Once you get your head round that, and or send me a copy of your lease to evaluate, then come back, but no way should you be asked to do repairs, and the management company reimburse you .

        Comment


          #5
          ''Once you get your head round that, and or send me a copy of your lease to evaluate, then come back, but no way should you be asked to do repairs, and the management company reimburse you.''

          No, I realise that now, but that is what happened and am looking for what I should do next.

          Comment


            #6
            This is very messy and done completely the wrong way. However, I'm afraid you selected the bad sub-contractor, so you are probably responsible for the consequences.

            Did the work come to more than £250 per leaseholder?

            Are you registered with the HMRC CIS? (You were acting as a building contractor, not a consumer.)

            This work is for a non-domestic client, so you would also have full health and safety responsibility for the work. Basically do not accept this arrangement unless the lease absolutely requires it. Only consider such things for minor things, like changing light bulbs.

            Comment


              #7
              ''Did the work come to more than £250 per leaseholder?'' - yes

              Are you registered with the HMRC CIS? (You were acting as a building contractor, not a consumer.) - Don't think so. I am a landlord and the flat is tenanted.

              I don't have any good point in the fact that the ceiling was coming down and were it not done straight away my flat would've been destroyed? I acted on their instruction and only because of their inaction.

              What about the new work? Can the management company legally hold off the new work till this issue is settled? Do they not have a duty to treat these two matters separately?

              Comment


                #8
                If it was more than £250, they were required to go through a section 20 process, so could not go single tender through you. The failure to do this, especially given that the work was defective, means that the other leaseholders do not have to pay more than £250 for the work (case law changes mean that they would have had to pay all or most of the cost, if the work had been necessary and properly done).

                If you have to do self help, you do the minimum necessary to mitigate the problem.

                Assuming that the lease is normal (and you haven't actually proved that) you could, in theory, sue them for specific performance of the lease, but, if they are having trouble getting service charges paid, they may end up illegally trading, by taking loans they cannot repay.

                If they had paid you fully for the work you arranged, they would be able to sue you for the total cost of the rework. Can you show that you obtained multiple quotes and properly vetted the sub-contractor?

                If you aren't registered for CIS, you probably broke tax law. You should have ensured you only acted as an agent and the management company actually signed the contract

                If you are a sub-landlord, my comments about health and safety don't apply, as any work you have done is not as a domestic client, so you are always responsible for health and safety compliance.

                In a lot of ways this is very similar to the situation where one of your tenants does work that you should have done, and the Shelter advice includes only doing it when the work is straightforward.

                Is the management company leaseholder owned?

                A good tactic here might have been to inform the insurers, as they would probably have put pressure on the management company.

                As I said at the start, if you are forced to do work yourself, to protect the property, you should aim for the minimum needed to achieve that objective, and be very careful about how you use.

                Comment


                  #9
                  It is a very odd way of dealing with repairs but if the management company asked you to instruct a contractor, you were acting as agent of the management company and the contractor should have issued the invoice to the management company. You should have asked the management company to pay the bill. The management company was responsible for complying with s20 notices, but many do not do so. It is also responsible for any tax which should have been deducted from the contractor's invoice but that is a matter for HMRC. The management company seems to have accepted the invoice otherwise it would not have charged the other leaseholders. In doing so, it accepted the work which was carried out.

                  The management company is responsible for carrying out works and it cannot refuse due to problems with the previous work. You obviously need to sort this out quickly before further damage is caused to the property. It looks like those running the management company need to be educated, perhaps you could suggest that they seek advice.

                  Comment


                    #10
                    Hi Eagle,
                    The Man Co said I had to pay up front if I wanted the work done as there was no money in the pot, so to speak, for such work. They told me that if I wanted the work done with any speed I would have to go this way. I had a steady stream of water entering the flat, a sagging ceiling, and tenants who were about to go away for Xmas.

                    Comment


                      #11
                      Many leases have provisions for immediate service charge demands under such circumstances, but we'd have to see your specific lease.

                      If you really needed to fund it (and it is questionable whether it would have been in their power to do so, they should have arranged for a formal loan from you.

                      Comment


                        #12
                        You effectively lent the money to the management company and if you have not recovered the full cost, the management company owes you money. It remains the management company's responsibility to carry out repairs and the lease will say if and when it can charge the leaseholders. If monies are needed urgently, it may need to beg steal or borrow but it is its problem not yours. A loan is not ideal whether or not there is a formal agreement, you may have difficulty recovering monies owing to you.

                        Comment


                          #13
                          I am willing to wait to try to recover the money. My priority is to get them to get the required work done and bill the leaseholders for it. They are saying they will not bill the leaseholders who paid for the previous work, until I have repaid it to them, which means they won´t get the work done.

                          Comment


                            #14
                            I suggest that you ask the management company to seek advice or suggest that you jointly instruct a solicitor or barrister or a surveyor to resolve the matter. That would be better than the alternative of threatening or taking legal action against the company. As a precaution you should take pictures of the work required now and note any further damage which arises,

                            Comment


                              #15
                              That´s maybe true in theory but, in practice, these are not nice people. They are an obstructive, bad management company. They have already told me their final stance on the matter is that I must repay the money.

                              Comment

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