Industry comment, updates and news from the Websters team.
Brandon Lewis of Department for Communities and Local Government has announced new measures that will clamp down on criminal landlords who trap and cram vulnerable tenants in unsafe, overcrowded homes, . Proposals will help councils tackle the problem head-on and bring an end to ruthless landlords who exploit their tenants and charge them extortionate rents to live in cramped conditions.
Read the full article here
Karl Anders of Walker Morris explains that the Court of Appeal has confirmed that deadlines for complying with conditions for relief from forfeiture are not necessarily set in stone.
Read the full article here
Tanfield Chambers has raised the problem inherent in joint ownership. It is not uncommon, on an enfranchisement of a terraced house converted into two flats, for the freehold to be acquired by the two lessees jointly. What then? Must both decide on service charge expenditure together? What happens if one of the two refuses to join in, can the other sue? What if one of the two breaches their lease as leaseholder? These are issues which have often arisen in cases I have dealt with. The answers lie in an analysis of the trust law implications of joint ownership.
Read the full article here
Walker Morris reports that a recent Tribunal ruled that whilst the cost of repair work undertaken by a landlord was fully recoverable from leaseholders under section 19 of the Landlord and Tenant Act 1985, a different approach must be taken when assessing whether the landlord can rely on this provision to recover the cost of improvement work.
Read the full article here
London based law firm Leigh Day has announced that it is bringing a group claim against Foxtons on behalf of landlords, in a legal case which could see the London estate agent facing a multi-million pound payout.
Read the full article here
In an article from Keeble Hawson it was reported that, a recent case in the Upper Tribunal of the Lands Chamber has been found in favour of a residential tenant who challenged her water charges. The estate water supply was measured by meter which could not be read remotely. The landlord therefore charged individual water charges from a central meter and recovered a proportion from each tenant through the service charge. The tenant argued this was wrong based on the high service charges raised.
Read the full article here
In the case of Arnold v Britton & Ors [2015] UKSC 36, Gary Milner-Moore and Joanne Keillor of Herbert Smith Freehills LLP comment on the Supreme Court’s conclusion that, in interpreting a service charge provision in a number of long leases, arguments based on commercial common sense should not be used to undervalue the importance of the actual words used, and that the correct interpretation was one which applied the natural meaning of the term.
Read the full article here
Brian Church for 24dash.com notes that social housing is changing. Instead of focusing exclusively on social housing tenants, many social landlords are branching out by developing flats and letting them subject to usual service charges. In line with this we are seeing a growing trend for social landlords to also bring in an element of service charge for their more traditional social tenants.
Read more here
Websters senior partner David Goddard says that ‘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’
Although you may regularly deal with some aspects of The Landlord and Tenant Act 1985, it may still be helpful to look through this summary from RPC, which sets out the basic principles in relation to the recovery of residential service charges. Property managers whose duties include the collection of service charges need to be particularly mindful of the provisions of this Act.
Read the full article here
