Insights

Industry comment, updates and news from the Websters team.

Q&A – New General Data Protection Regulation (GDPR)

Monday, May 7th, 2018 in Landlord, Managing Agent, Residential

With the new General Data Protection Regulations (GDPR) coming into force on the 25th May 2018 many Residents Associations and Management Companies are asking what this means for them.

In a recent Q&A from News on the Block, Vincent Billings of Bolt Burdon provides his advice on what is required to comply with GDPR in a property business.

He states;

The driving aim of the GDPR is to protect individual’s data. Any business cannot deal with personal data simply because it wants to. Every element of data processing must be justified according to the GDPR.

The starting point for dealing with the GDPR in relation to any property business is to establish what personal data you hold, where it came from and who you share it with including if any direct marketing takes place.

To read more click here.

Five factors to consider before combining service charge & ground rent arrears

Monday, April 2nd, 2018 in Commercial, Landlord, Managing Agent, Residential, Service Charge

In a recent post from News on the Block Clare Brady of Brady Solicitors highlights 5 factors to be considered before combining service charge and ground rents. She writes;

When acting for an RMC or Right to Manage Company, managing agents will often be told by the freeholder to allow them to deal with the service charge arrears. The benefits of such an approach are clear from the ground rent owner’s perspective, but is it in the best interests of the management company, the leaseholders and the block?

With ground rent recovery increasingly in the spotlight, both managing agents and freeholders must take care to ensure recovery procedures are legal, in line with the terms of the lease and – importantly – in the best interests of the RMC and leaseholders.

Click here to read the full article.

 

 

 

The Service Charge Code – is change on its way?

Thursday, January 11th, 2018 in Commercial, Landlord, Managing Agent, News, Service Charge

The Royal Institution of Chartered Surveyors (RICS) announced in October 2017 that a fourth edition of the Service Charge Code for Commercial Property was under deliberation.

Ahead of it’s proposed launch on 01 April 2018 Monika Holyst of Freeths Solicitors has provided some insight into the draft fourth edition of the Code.

Read the full article here.

 

 

Repair or replace? Sometimes it’s the landlord’s decision

Monday, October 16th, 2017 in Commercial, Landlord, Managing Agent, Residential, Service Charge

One of the main issues faced by landlords making a repair or replace decision concerns the recovery of such costs through the service charge.

In a recent article Zara Saunders of Shoosmiths comments that Service charge recovery can be a matter fraught with difficulty, even in the sphere of commercial property where no statutory limitation applies. Property owners may only recover costs to the extent permitted by a lease and issues frequently arise regarding whether an item of expenditure is one of repair or improvement and to what extent recovery might be permissible. Tenants will generally expect to pay the cost of repairs but not improvements.

Read the full article here.

The Construction Industry Scheme – 2017 Update

Wednesday, July 12th, 2017 in Commercial, Landlord, Managing Agent, Mixed Use, Residential

Zoe Stollard of Clarke Willmott provides insight into the Construction Industry Scheme and the changes which have been implemented in 2017.

The Construction Industry Scheme (CIS) is designed to decrease perceived undeclared payments in the construction sector. It requires contractors to register for the scheme and to withhold tax before payments are made to sub-contractors under contracts relating to construction operations. The amount of tax withheld depends on the registration status of the sub-contractor:

  • if they are unregistered, 30% must be withheld;
  • if they are registered, 20% must be withheld; and
  • if they meet certain criteria and register for gross payments, 0% must be withheld.

The contractor must then pass to the HMRC the amounts withheld.

Prior to April 2017, contractors could verify whether sub-contractors were registered and whether they could be paid gross online or by phone. From the 6th of April 2017 sub-contractors must be registered online.

Read the full article here.

 

The advantages of external audit for managed property portfolios

Saturday, April 1st, 2017 in Commercial, Landlord, Managing Agent, Residential, Service charge audits

When we started specialising in service charge audits they were frequently undertaken as part of the property owner’s general annual audit. This was not a satisfactory situation because specialist knowledge is needed for accurate service charge accounting assessment.

  • Landlords and tenants have transparent financial relationships
  • Tenants trust that the service charge is correct and fair at no added cost to the landlord
  • A reduction in investigations by tenants into service charges, saving time and money for landlords
  • Specialist advice on current techniques for the internal accounts team
  • Almost all general practice accountants and auditors unfortunately do not have the specialist knowledge and experience to fully understand your needs

Since that time many large landlords in the UK have moved to providing independent audited accounts for their service charges thus removing one cause of landlord : tenant conflict

Presence of tenant’s chattels frustrates vacant possession on break

Wednesday, January 4th, 2017 in Commercial, Landlord, Managing Agent

Burges Salmon LLP reports that, in the case of Riverside Park Ltd v NHS Property Services Ltd, the break clause in an NHS lease provided that the break would only be effective if vacant possession given but partitioning, kitchen units, window blinds and other such items were left in the premises.Therefore the landlord argued that the NHS had not given vacant possession of the premises and that therefore the break was invalid. The key issue was whether the items were fixtures or tenant’s chattels. If the items were chattels then vacant possession had not been given and the test for distinguishing chattels and fixtures centres on the degree of annexation and the object/purpose of annexation. The court determined that the items were chattels and not fixtures, because they were only “slightly attached” to the premises and did not provide a lasting improvement to the premises. The court also noted that, even if the items had been fixtures, the NHS had still not complied with the break clause, because the definition of “premises”  specifically excluded partitioning and tenant’s fixtures.

Disrepair to Property – New Obligations for Landlords

Sunday, December 11th, 2016 in Commercial, Landlord, Managing Agent

Paul Greatholder of Russell-Cooke reports that there is an obligation upon the tenant to return demised property at the end of the tenancy in a good state of repair. The problem with dilapidations disputes was that there was a perception that landlords were exaggerating their claims, thus leading to a failure to resolve disputes  in a commercial way. The Civil Procedure Rules in 1999 was not designed to change the law, but to persuade parties who are in a dispute to take certain steps before issuing court proceedings to see if the dispute could be resolved, or at least any differences.  The ‘persuasion’ arises from the risk that if a party chooses not to follow a protocol…..

Read the full article here.

Are litigation costs a service charge?

Wednesday, November 16th, 2016 in Commercial, Landlord, Managing Agent, News, Residential, Service charge audits

Eversheds has reported that, whilst there is no hard rule that use of general words in a service charge clause prevents recovery of related legal costs, in order to be certain, an obligation to pay solicitors’ costs under the service charge provision should be clearly spelt out. If those solicitors’ costs are to include litigation costs then that should equally be made clear.
Remember that, even where the lease makes provision for recovery of costs as part of the service charge, this can be overridden by the provisions of s20C of the Landlord and Tenant Act 1985.
This was clarified in the recent case Sinclair Gardens Investments (Kensington) LTD v Avon Estates (London) LTD.

Read the full article here

Are you a seller/landlord? Why replies to property enquiries must be accurate and up to-date

Tuesday, October 4th, 2016 in Commercial, Landlord, Managing Agent, News, Residential, Service Charge

In an article by Mills and Reeve, a tenant of part of a building had some concerns regarding the service charge. Due to these concerns, payment of the service charge was withheld by the tenant. There was correspondence between the tenant and the landlord’s managing agent’s solicitor regarding this matter and a service charge dispute had arisen on at least five occasions. In readiness for a sale of the property, draft replies to commercial property standard enquiries were prepared and the replies said that there were no disputes outstanding, likely or in the past and that there were no service charge arrears. The buyer’s solicitors asked for further information in relation to the service charge accounts and collection period. This information was not provided. Consequently, the court decided that the buyer was entitled to terminate the sale contract, have the deposit returned and to receive damages for deceit.

Read the full article here

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