CHI/00LC/LSC/2022/0079 — service charge decision
In CHI/00LC/LSC/2022/0079, decided 28 March 2023, the First-tier Tribunal considered 10 disputed service charge items at 24-38 Phalarope Way, St Mary's Island, Chatham, Kent and reached a mixed result: 2 items were reduced or disallowed. Full decision on GOV.UK below.
Property: 24-38 Phalarope Way, St Mary's Island, Chatham, Kent
Decision date: 28 March 2023
Full decision: Read on GOV.UK
Managing agent named in the decision: Omnicroft Limited.
What was challenged and what the tribunal decided
| Item | Demanded | Allowed | Outcome | Grounds |
|---|---|---|---|---|
| Other charges (2017/2018) | £1,683 | £1,683 | Allowed in full | — |
| Buildings insurance (2017/2018) | £1,713.05 | £0 | Allowed in full | — |
| Repairs & maintenance (2017/2018) | £1,280 | £1,280 | Allowed in full | — |
| Legal & professional costs (2017/2018) | £2,435 | £2,435 | Allowed in full | — |
| Major works (2017/2018) | — | — | Allowed in full | — |
| Management fees (2019/2020) | £3,600 | £2,700 | Reduced | Standard not reasonable (s19(1)(b)) |
| Management fees (2020/2021) | £1,723 | £1,473.53 | Reduced | Costs unreasonably incurred (s19(1)(a)) |
| Other charges (2020/2021) | £1,063 | £1,063 | Allowed in full | — |
| Cleaning (2020/2021) | £1,212 | £1,212 | Allowed in full | — |
| Gardening & grounds (2020/2021) | £1,612 | £1,612 | Allowed in full | — |
Section 20C order: partial.
Key passages (verbatim)
“On the basis of the accounts for the y/e 31 March 2019 in the bundle provided to the Tribunal it appears plainly to be the case that the required credit has been given to the Applicants and the Tribunal so finds.”
“the Tribunal is entirely satisfied that the Applicants have not been charged for the fire related repair works and that due credit has been correctly and properly given for the insurance receipt.”
“a cost is not incurred until 'the obligation to pay has crystallised' by virtue of an invoice or demand for payment… The Tribunal is bound by these decisions and has no hesitation therefore in dismissing the Applicants' challenge to this item.”
“it is clear in this case that on a proper construction of the terms of the Lease the Respondent is contractually entitled to the legal costs claimed by way of service charge.”
“these costs were in point of fact within the scope of the Mediation and are necessarily covered by the settlement reached.”
“it is appropriate to discount the managing agent's charges in this year by 25% to reflect poor performance and we so determine.”
“Again, and most unsatisfactorily the Tribunal is unable to reconcile the sum claimed in the accounts with the explanation offered by Mr Dann.”
“The space taken up by client documentation within Omnicroft's offices should no more be charged as an extra than the desk space used by the property manager for any given premises. Rather their overheads should be met more broadly by their management income.”
“there is clearly substance in the Applicants' criticism of Caxton's performance in terms of responding to and engaging with leaseholders. On the basis of the Applicants' evidence the Tribunal is satisfied that for a period of months the block was not being managed to a proper standard.”
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.