Question: I am a leaseholder in a block of four flats. The general maintenance is carried out by a management company, which does very little. Now it wants £16,000 from each of us up front for major external works.
We paid up front for major work 10 years ago to a previous company, but the standard of work was shocking. The block does need doing up as we have serious damp problems, but we already pay £1,400 a year in maintenance. Are we obliged to pay these big lump sums, or can we refuse on the grounds that none of us can afford to pay?
Answer: The services your landlord must provide and how service charges are payable should be contained in your lease. Most leases provide for service charges to be paid on certain dates throughout the year.
Works costing this much should be the subject of a Section 20 procedure, which gives tenants the right to make observations and nominate a contractor from whom the landlord should obtain an estimate.
If your management company should have consulted tenants but failed to do so, it will only be able to recover £250 from each tenant.
Service charges must be reasonable. If charges are higher than they should be because of previous poor management, you may be able to apply to the First-tier Tribunal (Property Chamber) challenging these proposed charges. The First-tier Tribunal can take into account affordability when considering if the proposed charges are reasonable, but just not being able to afford them is not a ground, in itself, for refusing to pay.
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These answers can only be a very brief commentary on the issues raised and should not be relied on as legal advice. No liability is accepted for such reliance. If you have similar issues, you should obtain advice from a solicitor.