BIR/41UB/LIS/2019/0050 — service charge decision
In BIR/41UB/LIS/2019/0050, decided 12 October 2020, the First-tier Tribunal considered 7 disputed service charge items at 12 Ashworth House, Cannock Road, Cannock and reached a mixed result: 5 items were reduced or disallowed. Full decision on GOV.UK below.
Property: 12 Ashworth House, Cannock Road, Cannock
Decision date: 12 October 2020
Full decision: Read on GOV.UK
Managing agent named in the decision: Pennycuick Collins.
What was challenged and what the tribunal decided
| Item | Demanded | Allowed | Outcome | Grounds |
|---|---|---|---|---|
| Major works (2018-19) | £9,727.43 | £5,472.14 | Reduced | Costs unreasonably incurred (s19(1)(a)), Apportionment error, Standard not reasonable (s19(1)(b)) |
| Buildings insurance (2017-18) | £938.18 | £487.45 | Reduced | Apportionment error, Not payable under the lease |
| Buildings insurance (2018-19) | £1,057.87 | £549.63 | Reduced | Apportionment error, Not payable under the lease |
| Buildings insurance (2019-20) | — | £361.14 | Reduced | Apportionment error, Not payable under the lease |
| Other charges (2018-19) | £145.40 | £0 | Disallowed entirely | Not payable under the lease |
| Administration charges (2019) | £270 | £270 | Allowed in full | — |
| Reserve fund contributions (2018-19) | — | — | Allowed in full | — |
Section 20C order: granted.
Key passages (verbatim)
“the Tribunal determined that a sum of £75,000.00 on account for the costs of the works to the roof, to include any professional fees and all VAT, to be reasonable... the proper costs that should have been demanded on 25th March 2018 on account from each of the Applicants towards the reasonable costs for the works to the roof amounted to £5,472.14.”
“Feb 2018 - Feb 2019: 80% of £9,544.09 x 6.384160% = £487.45”
“Feb 2019 - Feb 2020: 80% of £10,761.64 x 6.384160% = £549.63”
“Feb 2020 - Feb 2021: 80% of £7,070.96 x 6.384160% = £361.14”
“under the Fourth Schedule of the Leases, the lessees are only liable for the costs of insuring the property and the fees of any managing agents for the collection of rents, general management and administration. In addition, the Tribunal noted that Pennycuick Collins instructed insurance brokers to obtain terms and did not consider an additional fee for such services to be appropriate.”
“the Tribunal was surprised that the Respondent had failed to consider any alternate roofing systems to the Bauder system.”
“there was no evidence that the Respondent had any regard for the modest income of the lessees when deciding what type of roofing system to install.”
“The Tribunal considered that an 11.5% charge for professional fees in overseeing a replacement of a roof to be excessive.”
“In recalculating the figures, the lessees were being penalised for an error made by the lessor.”
This summary is assembled from the structured record of the published decision; amounts appear only where the tribunal stated them. Always rely on the full decision itself.