Excessive admin fee - who should I sue? The freeholder or freeholder's agent

[gck303]

About a year ago I sold a flat. To sell the flat I had to pay nearly three hundred pounds to a company who collects the ground rent. The information provided for my fee was little more than a letter stating that "the ground rent for this is not in arrears, and the buildings insurers are XYZ". Clearly a rip off.

I have been in an extended legal dialog with the agent appointed by the freeholder to collect the ground rent, or more accurately their solicitors. Their final argument is that I am suing the wrong party!!!

The freeholder and agent are part of the same group of companies and appear to have the same owner. However, the admin fee and ground rent are payable to the admin company. But this is not the freeholder.

Are they right?

Who should I be taking legal action against to recover this excessive charge?

Thanks in advance.

[andydd]

Who did you pay the fee too ? Surely its them who you should sue.

Unless there is some sort of RTM then any fees be it ground rent, admin or service charges are normally collected by a management company and passed onto the FH, the MC is normally employed by the FH.

It sounds as if you are disputing the 'amount' you actually paid, this comes under jurisdiction of the FTT, they are often quite lax and allow changing of defendants as your case is quite common, a county court maybe less flexible and strike out your claim if you name the wrong person.

Id be tempted to name both companies and make a FTT application and then make changes if necessary, or if they both claim that are the wrong person, let FTT decide.

[DNM2012]

Who should I be taking legal action against to recover this excessive charge?

I would forget it and move on, yes £300 is excessive, £150 seems to be deemed reasonable, is it worth legal action for that amount?

[PJackson]

My experience with freeholders is that they charge excessive fees, but not so excessive as to make it worthwhile to go to court.

[andydd]

Yes FTT fees have increased and I too wouldnt recommend an application, as whether you can get back fees and costs is not that clear so wouldnt be worth it.

[gck303]

andydd,

Thank you.

Ah, the FTT. I found about this once I had filed a court case. After an initial enquiry, the management company initially responded with a 'you have paid the fee, so cannot question it'. Which, of course, is not the case. My response to this was to follow through with my threat and start legal action.

I am due in court on this next week. So, if it gets struck out on this basis then I can approach the FTT.

It is my judgement of if it is worthwhile. And was not the question!!!! Why chase such a modest sum? Because I have had to pay this type of fee four times. I have sold two flats, and a very similar fee had to be paid to both the freeholder and management company. Suddenly the £300 is now £1200.

[andydd]

Courts are an odd one, a court doesn't necessarily the power to decide on issues of whether a amount is reasonable or not, they mostly deal with £xx amount is payable or not.

An FTT has jurisdiction under S27 of Landlord & Tenant Act 1985 not just to decide on whether amounts are payable BUT to discuss whether its a reasonable amount.

You should ask court to transfer to FTT, they should prob do this anyway.

They could strike it out if wrong claimant named but the time for strike out applications is normally much earlier in process, before allocation to track, sounds as if defendant has left it a bit late.

NO Im not convinced if its struck out you could 'have another go' at an FTT, this may well be re-litigation or abuse of process. i.e youve had your go and failed, you cant try again.

Sounds like you should of done a bit of preparation before starting the claim, what does your actual claim say ?, just that the fee is unreasonable ? You will prob need proof of this, i,.e similsr decisions, have a look at the LEASE site previous FTT decisions here >http://decisions.lease-advice.org/

And choose 1985/1987 decisions and do a search for relevant words, this may take a while to find what you want.

You can also look at Upper Tribunal decisions here > http://www.landstribunal.gov.uk/Aspx/Default.aspx thyese carry more weight and should be binding on lower courts.

[DNM2012]

It is my judgement of if it is worthwhile. And was not the question!!!! Why chase such a modest sum? Because I have had to pay this type of fee four times. I have sold two flats, and a very similar fee had to be paid to both the freeholder and management company. Suddenly the £300 is now £1200.

Absolutely up to you if you want to pursue this through the courts.

But as someone who has been through a FTT hearing which I won and taken to County Court by a leaseholder which was discontinued, for the amount of time and preparation needed, the rewards would need to be much greater for me personally.

Genuinely good luck.