Landlord has changed the proportion of service charge payable

Hi,

I wanted to ask the TSR community if they could provide some advice with regards to an issue that I'm experiencing with my leasehold flat (the landlord owns the freehold for the apartment block).

I purchased the flat in April 2013 and there are 9 apartments that comprise the development - some of these have 1 bedroom, some have 2, and a couple of them have 3 bedrooms (mine is one of the 3 bedroom apartments).

As part of the completion document I signed with the landlord when I bought the property, it had stated that:

'Tenant's share of total expenditure:
1/9th for insurance and the Building and for the Common Parts (subject to the provisions for variation hereinafter contained)'

To my understanding (and that of my lawyer at the time), this meant that I was liable to pay 1/9th of the service charge (i.e. 11.11%) that would be due every year.

However, a couple of days ago, I received a letter from an estate management firm now working on the landlord's behalf that had stated that my proportion of the service charge due for this new year was 18.75%, which represents a vast increase, and does not appear to be for any particular reason.

I emailed them to point out their error, but they quoted a different clause from my contract to me, as shown below:

'Variation of Services:
If at any time during the Term of the Demised Premises and/or the Building enjoying or capable of enjoying the benefit of any of the services/items hereinbefore referred to is increased or decreased on a permanent basis or the benefit of any of the services is extended on a like basis to any adjoining or neighbouring property or if some other event occurs as a result of which the Tenant's share of Total Expenditure is no longer appropriate to the Demised Premises the Tenant's share of total expenditure shall be varied by the Landlord with effect from the quarter day following such event in such a manner as it shall determine to be fair and reasonable in the light of the event in question and the Landlord's decision shall be binding on the Tenant (except in the case of manifest error) save that nothing contained in this lease shall imply an obligation on the part of the Landlord to provide the said services/items to any adjoining or neighbouring property.'

Does anyone have any knowledge on these sorts of matters? And do you believe there is any fair way of me to get the landlord to stick by our original agreement. It seems very strange for him to be able to increase my portion of the total expenditures relating to service charge barely 10 months after I bought my flat, and I don't believe that it is fair since there has been no change to the level of service offered.

Furthermore, the other 3 bedrooms flat in the building has their proportion of the service charge listed as 12.50%, which is equally as puzzling to me.

Please let me know if you could be of assistance or provide any suggestions for avenues of investigation that I could pursue. All help would be very much appreciated.

Many thanks.

Reply 1

Reue

Original post by Angel Interceptor

I wanted to ask the TSR community

You're unlikely to find many people here with much experience of leasehold purchasing and the relevant legal implications.

Start a thread over on this forum where there are far more users likely to be able to give better advice: http://forums.moneysavingexpert.com/forumdisplay.php?f=16

Reply 2

balotelli12

You have posted a clause in the lease that allows the landlord to do what he has done.

Reply 3

Alarae

I'm pretty sure that the owner of the freehold has the ability to set whatever service charge they want unfortunately.

It's the crappy nature of a leasehold flat :/

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Reply 4

Profesh

Original post by Angel Interceptor

1/9th for insurance and the Building and for the Common Parts (subject to the provisions for variation hereinafter contained)'

Oops.

Reply 5

Bill_Gates

1. You would have to get a total picture of the contract first

2. Are the other flats tenanted ? as this may increase your share in general

3. What does the service charge cover you for?

4. How long is the lease for?

i think you may have a case.

Reply 6

Key123

What Profesh said. Your assumed % is stated as being subject to the variation which allows the variation clause to be effective.

Did you get legal advice when you purchased? Was this explained to you? Did you instruct a solicitor to explain this document to you?

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Reply 7

Reue

Original post by Alarae

I'm pretty sure that the owner of the freehold has the ability to set whatever service charge they want unfortunately.

It's the crappy nature of a leasehold flat :/

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Thats not true, and leaseholders can challenge the costs. In the extreme, leaseholders are able to take over the running of the property from the freeholder's service management.