December 8, 2022

Ex-cabbie, 77, gets doubled service charges owing to anomaly in the lease

Alan Roth's flats has been paying a 2/148ths portion in service charges for 25 years ... until now, when he must  pay double

Alan Roth’s flat has been paying a 2/148ths portion in service charges for 25 years … until now, when he must pay double

Alan Roth, 77, a former cabbie, has had a nasty surprise in the service charges at his one-bedroom flat in north London.

For the past nine and half years he has been paying 2/148ths for his flat at Parkview Court, Newbury Park, Ilford, in service charges, amounting to £610 pounds.

Now he has been told that the correct proportion is 4/148ths and his service charges are to double to £1,221, with the first payment due in March.

“I am devastated. I am so angry about this, I feel the same as when I lost my wife,” he says.

He is convinced that the 4/148ths in his lease is an error and he and his family have contacted Campaign against retirement leasehold exploitation desperate for help. Campaign against retirement leasehold exploitation has written asking for an explanation, copying correspondence to the local Labour MP Michael Gapes and Sir Peter Bottomley, who has an interest in national leasehold issues.

The previous owner who lived in the flat for 16 years also paid the same ratio of service charges for the flat, whose lease was originally drawn up by McCarthy and Stone.

Indeed, all the one-bedroom flats styled “swan” by McCarthy and Stone pay the same.

But it appears Alan’s lease has the wrong proportion: it clearly states he should be paying 4/148ths.

Now Peverel and the freeholder Proxima, part of the Tchenguiz Family Trust have noticed the anomaly and want more cash.

Sandra Eadie, Peverel Retirement’s head of estate accounts supports services, wrote to Alan on January 24 apologising for under-charging him.

From now on his charges will rise from £610.91 to £1,221.82.

“Please accept our sincere apologies for this error, and we confirm we will not be requesting any payment from you for the historical underpayment,” writes Eadie, who suggests he contact someone else if he has an issue with this.

Sebastian O’Kelly, of Campaign against retirement leasehold exploitation, says: “This is an appalling situation for Alan, who has just discovered his living costs have doubled.

“Anomalies in leases, where the proportions do not add up to 100 per cent, are far from uncommon in leases unfortunately.

“The first course is to raise this with Peverel and Proxima, involving MPs in order to highlight the legitimate public interest involved in this – and encourage them to be flexible.

“If that does not work, Alan will have to ask the first tier tribunal to vary his lease to the proportion that it ought to be.

“We are very sorry to learn that this has happened to him.”

Comments

  1. Allen Roth

    This seems strange and with Peverel and Proxima at the helm it is not surprising?

    The Service Charges for the past years are not repayable as the Managing Agents are not allowed to collect money which was not requested once 18 months have passed?

    Some one will correct this if wrong?

    I have noted that the figure would have been quoted when you purchased the flat and therefore YOU may have decided that the Service Charge was to expensive and would have possibly not purchased had the true figure been given?

    No one should benefit from a mistake when money is concerned, but the situation where the flat would have been out of the question at the time if the full cost had been known does not I believe come into this category?

    On another note as I have spoken to SOK can we have a comments section to bring in new comments instead of using the reply to others as a new CCOMMENT?

    I NOTICE THAT WE DO NOT HAVE LEAVE A COMMENT ON THE JANET ENTWISTLE MEETING?

    • Campaign against retirement leasehold exploitation says

      This is correct. I do not want any public comments regarding the Entwistle meeting. After is best. Private ones please send to me:

      admin@Campaign against retirement leasehold exploitation.org.uk

      Regarding a forum, I have set one up in the past and it did not attract. I am also wary of comments, for which there are other forums.

      Campaign against retirement leasehold exploitation strives to be scrupulously fair. I am particularly concerned when employees of management firms get named in comments.

  2. Michael Epstein says

    To my mind, Campaign against retirement leasehold exploitation/LKP operate as a “News Group”, that publishes comments on the news features.
    About Peverel is more of a discussion group. Both have vital , though different roles to play.
    Campaign against retirement leasehold exploitation/LKP are able to maintain contact with Peverel/ARMA etc, because they take a more sober view.
    This “twin track” approach is proving to be very effective.
    I feel sure there are occasions when the sites are working on a story for which a too early post will ruin it.

  3. Michael Epstein says

    If due to an error on the part of Peverel, they have not collected all the service charges due, is it not correct that would mean the service charge account will be short of that amount?
    Since Peverel are precluded from collecting the arrears is it not their responsibility to make good the arrears?

  4. Basically whatever the lease states governs the issue ‘ END OF’.

    Surely Alan should have picked up on this before from Budget reports -the resident’s grape vine etc .

    The answer to this issue is ail be contained with in Section 166 of the Commonhold and Leasehold Reform Act 2002.

    A very complex section that would need expert legal interpretation and no doubt reference to a First Tier Tribunal process.

    However “Google” Section 166 of the Commonhold and Leasehold Reform Act 2002. and have a look
    yourself.

    Dare I say that Peverel appear to take a magnanimous position over this, although they are just as culpable in their incompetent accounting over the years not to have noticed, so is it a case two Wrongs don’t…….?

    Wonder what the budget account auditors have to say about it, surely some blame / recompense should be sent their direction as well?

  5. Applications to very the terms of a lease fall under the 1987 Act. The Tribunal application form can be found here

    http://hmctsformfinder.justice.gov.uk/HMCTS/GetForm.do?court_forms_id=3088

    • Bit late to apply to vary the lease terms Martin.

      Peverel are subordinate to Proxima and have failed to discharge their duty to Proxima by not invoicing the client [Alan] for the correct amount.

      Are not Peverel being a bit cavalier in depriving Proxima of income they are contracted to collect during the contested period?

      Wonder what Proxima’s view is of Peverel’s incompetence ? – I would insist that Peverel make reparation of their ineptitude by reimbursing them to the tune of £5795 for the nine and a half years they’ve undercharged Alan.

      Or is this a to simple, niave appreciation in the realms of leasehold management ?

  6. Kevin,
    Well said mate I believe that this will not happen?
    Proxima wouldn’t dare would they?
    Could they?
    No?
    Yes?
    WOW PLEASE KEEP US INFORMED?

  7. Michael Epstein says

    I may well have this wrong, so I stand to be corrected on this. Proxima should only receive ground rent/subletting income. The money collected by Peverel that is under dispute is for service charges.
    This is money that should have been collected by Peverel and allocated to the service charge trust account.
    As such, because of Peverel’s error the service charge account is £5,795 under what it should have been.
    Peverel cannot lawfully collect the arrears as they are time barred.
    It is therefore the responsibility of Peverel to make up the losses to the service charge account.

    • Michael you are quite right, we are only talking about service charges here not ground rent, apologies to Chas and all.

      However your point is correct about the deficit to the service charge account thus effecting all other residents because of their [Peverel] errors.

      I contend that Peverel should therefore reimburse Parkview Court’s service charge account .

      But initially as ‘Carexx’ says below, it must be established if Alan’s lease is wrong first before we make judgments about who should pay what to whom.

      PS What is this “swan” designation of McCarthy and Stone, is it significant ??

      • Thats exactly right. Swan is a property type and correlates to a given percentage or so it seems. Its really a matter of if there has been an under collection or now an over collection, and as said they are time barred from recovering past costs. if its now 100% after the error, then there is no option to apply to the FTT (nee LVT). While the lease is king he could however take advice on estoppel due to the 16 years of being billed as 2 not 4, or see if the lease has a variation or reassessment provision and argue a fair proportion that way in the FTT ie “I’m swan at 2/xxxx and thats fair”. He’d likely get a determination accordingly.

  8. Campaign against retirement leasehold exploitation says

    I don’t think this is going to help Alan Roth. We are trying to establish that his lease is erroneous and that he should pay only 2/148ths along with all the other flats that McCarthy and Stone designated “swan”.

    • Ok but does his lease have a variation or reassessment provision and argue a fair proportion that way in the FTT ie “I’m swan at 2/xxxx and thats fair”. He’d likely get a determination accordingly.

      • Campaign against retirement leasehold exploitation says

        My comment above was directed at Michael Epstein, and is now out of sequence.

  9. Michael Epstein says

    Either the lease is right or it is wrong!
    If the proportion really is 4/148 than the service charge would be payable, in which case Peverel must make good losses due to the service charge trust accounts due to their admitted negligence.
    However, what leads me to believe that an error has occurred in the drawing up the lease is that similar flats are paying 2/148. It would be of interest to find out if other flats paid at 4/148 if it would take the percentages above 100%?
    Even after all these years, if an obvious error is contained in the lease, setting right those errors should (for most freeholders and leaseholders be a simple unopposed procedure.
    Given the manner of Peverel’s operating methods, it would be inconceivable that Alan is the sole victim of these errors.

    • Which they put right by doubling his charges! 🙂 Sadly its not as simple as you hope as they are clearly out of pocket or worse still he’s underpaid and someone has overpaid…………. The cabbie is looking for a way to keep it at 2 not 4 and whatever the lease says, he’s right to at least try and do that.