Reserve fund

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    #16
    Originally posted by Starlane View Post
    ....To set aside ( which setting aside shall for the purpose of the Sixth Schedule be deemed an item of expenditure incurred by the Lessor) such sums of money as the Lessors reasonably require to incur in replacing maintaining renewing and decorating those items which the lessor hereby covenants to replace maintain renew or decorate ( such sums set aside to be a sinking fund)
    That seems to allow the freeholder to collect a 'sinking fund' that can be used for any maintenance work that the lease makes them responsible for (but not for things like managing agents fees, insurance or legal fees).

    Best practice would be for them to be open about the expected future expenditure that they are asking for sinking fund contributions for - but, as eagle2 has said, they are under no legal obligation to do so (unless your lease requires this).

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      #17
      Many thanks to you all for your wisdom and help!

      Comment


        #18
        I have been reading through my lease to try and find any wording such as "reserve" in the lease so please enlighten me...Can the freeholder ask for contributions to a reserve when it is not mentioned in the lease? Can the freeholder ask for a reserve contribution? I have written to the landlord asking for clarification and I am being ignored?

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          #19
          Originally posted by Starlane View Post
          I have been reading through my lease to try and find any wording such as "reserve" in the lease so please enlighten me...
          Hi,

          Your post #15 states the lease provision, where it uses the wording "sinking fund", please see the glossary in the RICS Code of Practice.

          https://www.rics.org/globalassets/ri...ition-rics.pdf

          I believe your issue is that what is being asked for as a contribution now to the reserve fund is an unreasonable amount, given that it has not been demanded in the past.

          Comment


            #20
            Thank you foss333, I have been digging through the lease and any documents...the freeholder is asking for a reserve contribution....I will check the RICS guide.

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