LVT Decision - freeholder refusal to comply with their decision

Collapse
X
 
  • Filter
  • Time
  • Show
Clear All
new posts

    LVT Decision - freeholder refusal to comply with their decision

    We have recently gone to the RPTS to get a ruling on service charges due to our freeholder for the period until our RTM took over (about a year ago).

    The LVT has determined that no monies are due to the freeholder (each owner had approximately £1,000 on their accounts as 'service charges'). Therefore we should expect to get an amended statement with this £1,000 removed, and therefore showing a zero balance.

    However our freeholder is refusing to do so. They ignore all correspondence and requests for them to correct the final statement. They cannot chase us for the payment - any court would simply tell that that it was not due as per the LVT decision. However, we are concerned because it looks like we still owe them money and therefore could cause problems if one of tries to sell. It also feels terribly threatening to keep getting these statements saying that we owe them money.

    I assume we might need to now get a solicitor, however I wondered if anyone might have any advice as to how we could proceed.

    With many thanks!

    #2
    Practically speaking, I don't think there's anything you can do to force them to amend the statements, which means if they object to an assignment you are stuck with going to an LVT (which will probably cost you the sale). Would purchasing the freehold be an option for you?

    Comment


      #3
      1. The best way forward is for leaseholders to to set up RTM company to take over the service charge administration under the lease ( leaving the freeholder with just collection of annual ground rent and forfeiture matters ). But you should seriously consider collectively buying the freehold.

      2. Its a form of fraud to keep sending statements to say you owe maney when its not true. Check if the freehold title at Land Registry has a charge registered by a bank, you ( or enlist your local MP ) could write to the bank and ask for their investigation into possible fraud.

      Comment


        #4
        They already have an RTM Company and I doubt the bank will be interested. I have a feeling that this problem will become common where RTM's are set up as the result of disputes and the legislation doesn't seem to properly address it. The sad fact is that a buyer is likely to walk away if the landlord raises an objection, even if the seller can show that the landlord doesn't have a leg to stand on.

        Comment


          #5
          The op has stated in their first post that they have set up a RTM (a year ago)
          I'm interested in the answer to this because i'm in the same situation. But I'm the freeholder and the leaseholders genuinly owe me service charges up till the rtm took over. 3 are up for sale one being sold stc.Just hoping that If the RTM follow legislation and give me 1 months notice its being sold ,that I can say no and they will have to take it to the lvt. Maybe then it will all get sorted out.
          And to top it all off the rtm are still ignoring my request to become a member (2 months after they took over)

          Comment


            #6
            Sales: It should not create any concerns over sales. The buyer will ask the RTM or their agent and they will provide an up to date statement since RTM AND when asked about 3 years sets of accounts will attach to the period up to RTM the accounts AND the LVT determination of service charge for the year. You can produce your statement of receipted payments showing the amount you should have paid, rather than than what the landlord wants.

            Accounts: If no accounts have been produced for the period up to RTM, then exercise your right, if still in time, under section 21 of the LTA
            so that they are created and include the LVT determination.


            There are various legal remedies, but until the landlord actually queers the pitch, there is little the Solicitor can do.
            Based on the information posted, I offer my thoughts.Any action you then take is your liability. While commending individual effort, there is no substitute for a thorough review of documents and facts by paid for professional advisers.

            Comment


              #7
              Originally posted by hollyhead View Post
              The op has stated in their first post that they have set up a RTM (a year ago)
              I'm interested in the answer to this because i'm in the same situation. But I'm the freeholder and the leaseholders genuinly owe me service charges up till the rtm took over. 3 are up for sale one being sold stc.Just hoping that If the RTM follow legislation and give me 1 months notice its being sold ,that I can say no and they will have to take it to the lvt. Maybe then it will all get sorted out.
              And to top it all off the rtm are still ignoring my request to become a member (2 months after they took over)

              Well if the amounts have been certified under section 21 start those court proceedings ( let the court refer to the LVT or whatever they are calling it from Friday!).

              The buyers will ask you about ground rents prior to the sale at which time you can make it clear.
              Based on the information posted, I offer my thoughts.Any action you then take is your liability. While commending individual effort, there is no substitute for a thorough review of documents and facts by paid for professional advisers.

              Comment


                #8
                Thank you for all of these answers and thoughts - it's a lot of helpful information.

                I'm interested in the idea of it being 'fraud' or possibly 'harassment' to continue to send statements saying that we owe money that the LVT has determined is not owed. Under debt collection regulations I understand that this is not allowed so I was thinking perhaps we should send a letter to that effect. We would love to resolve it before one of us needs to sell as I'm sure that this would put off a buyer.

                Sadly we can't get the freehold as it would be too costly and not many owners are in favour. We've also had so many problems with the freeholder that it is possible that they would make the process very difficult - and after a very difficult (and drawn out LVT process) I think we've all lost the desire to go any further.

                It does seem a shame that you go to the LVT, work so hard to get a judgement, and then you are effectively no better off. For such small sums of money it makes it very difficult to pursue the route to engaging a lawyer to enforce the ruling - and it seems like the freeholder knows this.

                Thank you again for any thoughts.

                Comment


                  #9
                  Your block of flats really should be considering collectively buying the freehold as the leasehold system is a long term rental agreement based on unfair terms for the leaseholders.

                  You can send a copy of the LVT judgement and a statement dated after the LVT decision to (1) the National Fraud Authority ( Now under the Home Office since April 2011)and
                  (2) your Local MP to forward to Housing Minister .

                  Comment


                    #10
                    I totally agree about the unfair terms, and as the Freeholder still uses the 'managing agent' to collect ground rents, I suspect that they will continue to cause problems into the future even with us having an RTM. Sadly buying the freehold is not an option as we can't get enough to agree - and not having everyone puts the others off as it makes it so expensive. Sadly - I'd love to buy it!

                    I wonder if the fraud office would be interested - but I could certainly try, and MP. I do think that the LVT process - and it's lack of enforcement - is rather off-putting. Over a year of agony and we are still no better off - and if anything, might be worse off. Certainly mentally it might have been easier to just pay the money to them even though it was unreasonable (as upheld by LVT) and justifiably not due as they didn't do any work.

                    I will try and strongly worded letter one final (third) time and see if anything happens.

                    I did also wonder what 'leaseholdanswers' meant when they said, There are various legal remedies, but until the landlord actually queers the pitch, there is little the Solicitor can do.' Does that mean a solicitor is no help to me?

                    Thank you again.

                    Comment


                      #11
                      Originally posted by jh321 View Post
                      I did also wonder what 'leaseholdanswers' meant when they said, There are various legal remedies, but until the landlord actually queers the pitch, there is little the Solicitor can do.' Does that mean a solicitor is no help to me?
                      I don't think you have understood the full import of my posts.
                      1: Until the landlord actually says to a buyer " you owe this money" or actually creates one of the problems that you fear, thee is nothing to take action on.
                      2: To make it "go away" entirely, which is what you want, is only available by buying the freehold.

                      What you can do is manage the problem, as above by
                      1; LVT determination that £x was use for that year (s). The buyers solicitors have to accept that instead of any claim by the landlord.
                      2: Proof by the seller that the amounts due have been paid to and taken by the freeholder. Their bank can confirm in writing for a fee.

                      Finally if the LL does take one of you to court then good- a court order that nothing is due is extremely clear.
                      Based on the information posted, I offer my thoughts.Any action you then take is your liability. While commending individual effort, there is no substitute for a thorough review of documents and facts by paid for professional advisers.

                      Comment


                        #12
                        Thank you for the clarification leaseholdanswers. However, does the fact that they have sent us a bill/statement saying that we owe this money not give us what we can act on? Even worse I have since paid my ground rent, and rather than state on it that I have paid ground rent they have, instead, simply deducted the payment off the balance.

                        In other words they have applied my payment for ground rent against monies that the LVT have determined are not payable to them.

                        I have written twice now to ask that they correct the statements - remove the service charges that the LVT determined were not due, and to apply my ground rent to the ground rent demand - and therefore generate a statement with a zero balance.

                        They have ignored my letters, and simply sent another statement still showing that I 'owe' them money. ie the balance that the LVT determined was not due.

                        Can I not take this as 'evidence' to act on?

                        Comment


                          #13
                          Originally posted by jh321 View Post
                          Thank you for the clarification leaseholdanswers. However, does the fact that they have sent us a bill/statement saying that we owe this money not give us what we can act on? Even worse I have since paid my ground rent, and rather than state on it that I have paid ground rent they have, instead, simply deducted the payment off the balance.

                          In other words they have applied my payment for ground rent against monies that the LVT have determined are not payable to them.

                          I have written twice now to ask that they correct the statements - remove the service charges that the LVT determined were not due, and to apply my ground rent to the ground rent demand - and therefore generate a statement with a zero balance.

                          They have ignored my letters, and simply sent another statement still showing that I 'owe' them money. ie the balance that the LVT determined was not due.

                          Can I not take this as 'evidence' to act on?
                          Then yes this is something that your solicitor can act on.

                          Rather than litigating however, perhaps you might look at extending your lease so that the ground rent becomes a peppercorn. If you have a long lease, the premium might be quite small and be the same as your litigation costs.

                          Remember that you might clarify the problem now, but next due date it might arise again.

                          A strategy might be to refuse to pay GR unless they will sign a letter which you provide that payments will be accepted as ground rent alone, which you are perfectly entitled to require them to do, failing which you will use this as a defence ( along with the fact that they billed ground rent with the section 166 notice and the demand itself) in any court proceedings that they bring.

                          Deposit it on interest, advise your mortgagee of the issue, and have the LVT determine the old charges, so that were it to come to court your defence is straightforward, and there is a strong argument for no award of costs.

                          At worst when you come to sell you just deduct the ground rent outstanding from the completion statement for the purchaser, or send the purchaser a cheque for the arrears!
                          Based on the information posted, I offer my thoughts.Any action you then take is your liability. While commending individual effort, there is no substitute for a thorough review of documents and facts by paid for professional advisers.

                          Comment


                            #14
                            You could apply to the court for an order for specific performance I suppose.

                            Comment

                            Latest Activity

                            Collapse

                            Working...
                            X