Landlords charge service charges to recover their costs in providing services to a building. The manner in which service charges are calculated are usually set out in the lease or tenancy agreement. The charges usually cover the costs of services such as general maintenance, repairs, buildings insurance, central heating, lifts and lighting and cleaning the shared areas.
Service charge disputes between freeholders and leaseholders can take many forms. Typically, service charge disputes surrounds:
Generally, it is advised that service charge disputes are dealt with efficiently and without recourse to formal litigation.
However, whether litigation is unavoidable, both leaseholders and freeholders have a right to ask the tribunal whether a charge or a proposed charge is “reasonable”. It is important to note that the law does not define “reasonable”.
Once an application has been made to the tribunal, may consider the circumstances surrounding the charges and where the charges are relating to work completed at the property, whether the work was carried out to a reasonable standard.
The tribunal will make the following decisions:
Where a leaseholder fails to pay the service charge, a freeholder may take steps to forfeit the lease.
Whether you are a leaseholder or a freeholder, we will take steps to: