Excessive Debt Collection charges after service charge arrears

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  • Section20z
    replied
    Originally posted by ellenchen95 View Post

    So in summary, you would suggest, pay all the £1000, do nothing. Let it go?

    I thought I do have some a bit right to argue a bit?
    Realistically that's best advice, personally I would just pay the bill and ignore the late payment charges and wait for them to take you to FTT. Trouble is they will bombard you with ever more threatening letters and further charges and next year they will knock any payment off earlier "debt" first so you need stomach for a long fight
    And if you ever need to sell it will cause you problems.
    Unfair but that's the system sorry.

    Leave a comment:


  • Jon66
    replied
    They do appear disproportionate until you start thinking about the effects leaseholders not paying the service charge has on the building generally, on other leaseholders, and on the leaseholder its self who may eventually be subject to forfeiture. So it's pretty serious to 'forget'.

    You could have a look at the debt collection guidelines/code of conduct. Make a complaint to the managing agent, and after the end of their process to the appropriate ombudsman or ADR to which they have to be signed up.

    I think for what it's worth you should make a complaint because its disproportionate. Not least because they failed to include the statutory information.

    A similar thing happened to me when they were sending letters to the wrong address, but luckily they had the sense to ring me after 3 months and we worked it out.

    Now I make calender notes of when charges are due.

    Leave a comment:


  • ellenchen95
    replied
    Right, what I have done so far. I paid the £1000 today.
    And I have also got the 1st letter from the Debt collection company, which I didn't receive. Within the letter, they simply specific the amount I should pay, with no breakdown, no summary of rights.

    As this is an electronic letter, so no proof of when they have send out.

    Do I have any ground for a fee dispute for their later action charge- ie those they add-on charge, including contact my mortgage bank.

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  • AndrewDod
    replied
    Originally posted by ellenchen95 View Post

    So in summary, you would suggest, pay all the £1000, do nothing. Let it go?

    I thought I do have some a bit right to argue a bit?
    No I didn't say that. I said pay it in full (under protest) then bring an FTT case.

    However:
    - you might well lose
    - If you have paid it you are unlikely to end up having to pay extra costs
    - The FTT in some parts of the country has pretty much ceased to exist even for urgent health and safety matters. People are suffering huge detriment as a result and it has provided free scope for fraudsters, prevented dealing with unsafe buildings, and I'd imagine a few people have died as a result. They don't even answer extremely urgent H&S correspondence marked as urgent in the way they suggest it is marked.

    And make sure you never do it again. Owning a leasehold property is like riding a shark - you don't treat it as a casual joke

    Leave a comment:


  • Jon66
    replied
    Have a look at the RICS code of guidance which managing companies are supposed to follow. You may find it helpful in your arguments. https://www.rics.org/uk/upholding-pr...nagement-code/

    Leave a comment:


  • ellenchen95
    replied
    So in summary, you would suggest, pay all the £1000, do nothing. Let it go?

    I thought I do have some a bit right to argue a bit?

    Leave a comment:


  • AndrewDod
    replied
    ellenchen95,

    When it appears at Tribunal you will find in the bundle a half a dozen other letters you have never seen before. That is how it works. On the balance of probabilities they will say it is completely expected that those letters would have been written over a protracted period of non-payment.

    The invoice is due when it is due (according to the lease). There is no such thing as it not being due (if the lease says it is due) until the lease-year has ended.

    In any case debt collection agencies (and lawyers chasing debts) generally bombard you with letters - they don't write just one letter in 6 months. That is not their business model.

    Leave a comment:


  • ellenchen95
    replied
    AndrewDod,

    I have read your link of the latest case.

    I do admit that I forgot to pay in the first instance. However, I think my current argument is around 1st letter from the DCA.

    Since this 1st letter should contain everything and the fail of delivery of this first letter is key drive for the later escalation charge.

    Leave a comment:


  • ellenchen95
    replied
    No, the only clause I could find within the lease was the one mentioned that the service charge run from 1st Jan to 31 Dec and paid in advance half yearly. No other mention abouif the service charges fallen into arrears are subject to any interest.

    I think my key issue here is the case of not receiving the first letter from the debt collection agency. As if I would received it, it won't go into further escalation even to my bank and with additional charges.

    Given the factor that the 2nd letter from the debt collection agency dated on the 21 Sep was received until 23 Oct. Would I have a chance to argue the on time delivery?

    Also, the 1st letter from the debt collection agency I suppose should have included my rights and obligation. But again, this letter was lost.

    I'm asking the management company/Debt collection to provide the evidence of they did send me the first letter.

    My next question would probably be, what are the acceptable form of this evidence. I'm worry they may just come back with a copy of letter dated in early September. But issuing letter is not correct evidence that they posted right?

    Thanks

    Leave a comment:


  • Gordon999
    replied
    Ellen,

    Does your "one year service charge period" operate from 1st Jan or 1st July ? Is there any clause in the lease to say service charge payments fallen into arrears are subject to 4% interest above Nat West Bank rate or similar bank?

    I believe that you can argue that it does not become a debt until after the end of the complete service charge year and after you have admitted to the debt and refused to make payment. I believe you can make an application to the FTT for judging the reasonableness of the charges which are not written into the terms of your 99 years or 125 years lease.

    Leave a comment:


  • AndrewDod
    replied
    Originally posted by fos333 View Post
    I read your post as an attack on the OP who was seeking advice and certainly not criticism for missing a payment.
    And by the way, OPs don't get to avoid criticism. If they don't want to get criticism they should seek advice privately. I don't see this forum as an advice column, though sometimes it is. And the advice is often not specific to the OP but applies generally.

    Advice along the lines of "If you buy a leasehold property and don't understand that this might well involve severe penalties and risk, and that failure to adhere to some basic principles is idiocy" is good advice. It may be too late for the OP, but these stories are lessons for others.

    AST Landlords often get advice of a similar flavour, and rightly so.

    Leave a comment:


  • AndrewDod
    replied
    The OP is also advised to read tribunal judgements. Here is one for example

    About £400 for two letters
    https://decisions.lease-advice.org//...4000/13332.pdf

    The OP describes a scenario that wold have involved multiple requests, an approach to the mortgage company, and then to a debt collector who would have charged a fee. I wouldn't bank on £1000 being regarded as unreasonable.

    Leave a comment:


  • fos333
    replied
    Thanks Andrew, the OP can now decide.

    Leave a comment:


  • AndrewDod
    replied
    OK if OP wants advice.

    a) Pay the charge and the administration charge in full and do so immediately.
    b) Don't waste time contacting lease or the DCA in this particular instance
    c) Don't think that the failure of a "rights" letter with the admin charge is going to help in the long run
    d) Apply to the FTT with regard to reasonableness (HAVING PAID IN FULL - anything else is folly) if so inclined

    I agree the charge is probably unreasonable, and OP should also review their lease. However the FTT/Upper Tribunal would probably regard charges of £100/hour for 5 months of chasing including having to involve the mortgage provider to be perfectly reasonable, lots of other letters will suddenly appear. And there is also interest.

    Leave a comment:


  • fos333
    replied
    Really, I read your post as an attack on the OP who was seeking advice and certainly not criticism for missing a payment.

    I further advised the OP to contact better placed organisations where they will receive a better understanding and advice, something that I believe was missing in your post!

    Leave a comment:

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