Ms P owns a leasehold flat in East London in a development of 105 properties. She received a revised service charge statement from her freeholder after disputing the final statement when it was issued a couple of months earlier.
In the revised statement the freeholder added an additional charge of £100 per flat for building insurance. The charge was unexpected and was not included on the estimated statement for 2019/20 or the final statement issued to the leaseholders.
The client contacted LEASE for advice on whether this charge was reasonable and payable. A LEASE adviser emailed Ms P with advice and explained that ‘any service charge claimed must be reasonable under section 19 of the Landlord and Tenant Act 1985’. The main arguments used by leaseholders to prove reasonableness are:
- That the charges are too high compared to the going rate for the job
- That the works were unnecessary
- That the works were substandard
‘To prove a service charge is too high you will need to try and obtain a quote for the same works. A surveyors report can also determine the standard or necessity of the works.’
Following advice from LEASE Ms P was able to successfully challenge her freeholder over the additional charge. The freeholder agreed that due process was not followed and that the charge would be removed from the final statement. In total, each of the 105 properties in the block received a refund of £110.
Ms P said, ‘Thank you very much for the information provided which gave me the conviction to pursue this issue to its conclusion.’
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