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A common bone of contention between landlords and tenants is the extent to which a landlord can recover costs of improvements to the building from tenants through the service charge. The answer is not always clear cut. The starting point is always the terms of the lease – does the lease allow the landlord to recharge the cost of improvements through the service charge? If not, and the landlord’s right to recover costs is limited to repair and maintenance, it is unlikely that the costs of an improvement, i

As we all know, when a leaseholder breaches a covenant under the Lease, usually a covenant relating to the payment of ground rent or service charge, the ultimate sanction held by the Landlord and/or the management company is that of forfeiture. For that reason it is critical that, while debt recovery proceedings are taking place, no steps are taken which could waive the right to forfeit. Potentially, anything which takes place after the breach arises which indicates that there is a continuing lease could

It is no great secret that many leases are, by any objective view, defective. If for example the computation of service charge in respect of the proportion paid by each lessee does not add up to or is more than 100% - the lease is essentially defective and leaves a scenario where the landlord is either making up the shortfall or recovering more than what has actually been paid out.    There are many reasons why a lease fails to make satisfactory provision for the computation of service charges. This inclu

Sheffield’s Taylor&Emmet LLP is adding three new faces to its property management team to meet rising demand from clients across the UK.  A solicitor and two paralegals are joining partner, Cassandra Zanelli, to meet increasing interest in the firm’s advice for landlords, property agents and leaseholders.    Specialist solicitor, Liz Rowen, will be handling complex litigation cases in both the First-tier Tribunal and county court, dealing with issues such as insurance arrears and breach of leases.    She

Service Charges are close to the hearts of many of us working in the property management industry. They are the lifeblood of any development. Payments are made by leaseholders to the landlord in exchange for services and it is a reciprocal relationship - many landlords are not-for-profit resident management companies, for whom service charges are their only source of income. The services landlords are required to provide, such as repairs, cleaning, insurance and management, can only be undertaken when lea

It can be tiresome to keep repeating the phrase “read the lease”. But that does not make it any less correct. In Clacy v Sanchez [2015], the Upper Tribunal (Lands Chamber) considered the contractual procedures for the recovery of service charges, which fall to be observed under the terms of a lease. We saw the importance of following the contractual mechanism for recovery in Southwark L.B. v Woelke [2013], where the landlord had billed service charges for major works separately from routine or annually re

From the date it acquires management, a RTM Company has the right to step into the existing landlord’s shoes under the terms of the leases in order to collect service charges from the leaseholders. However, in some circumstances a RTM Company might find it is unable to recover historic service charge arrears and other costs leading to a serious hole in its budget. When a RTM Company acquires the Right to Manage, it is entitled to all of the service charges held by the landlord in the service charge accoun

Terms and Conditions, management agreements, terms of appointment: call them what you will; without a written agreement in place with your RMC client, you are leaving yourself open to unnecessary levels of risk. We come across many different forms of terms and conditions but, surprisingly, we find that a considerable proportion of blocks are managed without any kind of written agreement. And this isn’t just a problem for the smaller managing agents. Without terms of appointment, you are effectively acting

The 1989 case of Sella House Limited v Mears made it clear that provisions in residential leases purporting to make a tenant responsible for subsidising the landlord’s costs of pursuing co-tenants must be “clear and unambiguous”. The clause relied upon in Sella was not considered clear as there was no specific mention of lawyers, proceedings or legal costs. The lease simply permitted recovery through the service charge of the costs of collecting the rent and service charges, and employing professionals fo

Over the last nine months I have had a lot of conversations about the state of leasehold management. I have encountered the nuances of the soft side of management. When calls go unanswered; when information is not supplied; when the leaseholder feels they are not getting service are all the soft areas that are vital to the management process of a building.    Although I genuinely believe managing agents’ service levels have improved over the last five years, there will always be examples of poor service,

A new edition of the leasehold property enquiries form LPE1 - the standardised questionnaire designed to simplify and speed up the conveyancing process - was released on October 1.    The form has been amended to reflect changes in the Association of British Insurers’ agreements with lenders; provide better definitions and general wording; and include new questions aimed to reduce the need for additional enquiries, for example with regard to any transfer fees payable on sale.  A buyers leasehold informati

McCarthy & Stone has conducted a study exploring how retirement is evolving and individuals are moving away from traditional retirement habits. More than 2,500 retirees from across the UK participated in the retirement housebuilder’s “The Colour Report”, which looks at the differing opinions of three retirement age demographics: 65-70, 70-74 and 75+. The report highlights that the older generations shop in the same shops as their grandchildren, (21% at Primark, 14% at H&M and TopShop), listen to the same