CHI/21UC/LSC/2020/0103 — service charge decision
In CHI/21UC/LSC/2020/0103, decided 20 March 2021, the First-tier Tribunal considered 6 disputed service charge items at Flat 4, Stafford House, Southfields Road, Eastbourne, East Sussex and reached a mixed result: 5 items were reduced or disallowed. Full decision on GOV.UK below.
Property: Flat 4, Stafford House, Southfields Road, Eastbourne, East Sussex
Decision date: 20 March 2021
Full decision: Read on GOV.UK
Managing agent named in the decision: Eastbourne Lettings.
What was challenged and what the tribunal decided
| Item | Demanded | Allowed | Outcome | Grounds |
|---|---|---|---|---|
| Reserve fund contributions (2015/16-2019/20) | — | — | Allowed in full | — |
| Management fees (2015/16) | £3,000 | £1,200 | Reduced | Costs unreasonably incurred (s19(1)(a)), Landlord could not evidence the cost |
| Management fees (2016/17) | £3,100 | £1,200 | Reduced | Costs unreasonably incurred (s19(1)(a)), Landlord could not evidence the cost |
| Management fees (2017/18) | £3,150 | £1,200 | Reduced | Costs unreasonably incurred (s19(1)(a)), Landlord could not evidence the cost |
| Management fees (2018/19) | £3,280 | £1,200 | Reduced | Costs unreasonably incurred (s19(1)(a)), Landlord could not evidence the cost |
| Management fees (2019/20) | £3,370 | £1,200 | Reduced | Costs unreasonably incurred (s19(1)(a)), Landlord could not evidence the cost |
Section 20C order: granted.
Key passages (verbatim)
“it was reasonable for the Respondent to amass a sum of some £70,000 by way of service charge demands in the period following 2015. It follows that the demands for sums towards the reserve were reasonably demanded, save for what the Tribunal says below in respect of Freeholder management fees.”
“the Tribunal has concluded that a reasonable payment to the freeholder for management fees in the years 2015/16 to 2019/20 should be limited to £1200 inclusive of VAT per annum.”
“the Tribunal has concluded that a reasonable payment to the freeholder for management fees in the years 2015/16 to 2019/20 should be limited to £1200 inclusive of VAT per annum.”
“the Tribunal has concluded that a reasonable payment to the freeholder for management fees in the years 2015/16 to 2019/20 should be limited to £1200 inclusive of VAT per annum.”
“the Tribunal has concluded that a reasonable payment to the freeholder for management fees in the years 2015/16 to 2019/20 should be limited to £1200 inclusive of VAT per annum.”
“the Tribunal has concluded that a reasonable payment to the freeholder for management fees in the years 2015/16 to 2019/20 should be limited to £1200 inclusive of VAT per annum.”
“The Tribunal struggled to understand what the freeholder had done to deserve any payments at all during those years save for arranging the insurance and having some involvement in limited minor works.”
“The Tribunal found it more than a little concerning that the Respondent should be making payments to the freeholder and allowing the freeholder to take funds from the reserve fund when it did not know what it was paying for. It cannot be reasonable to expect leaseholders to make such high payments to the freeholder in such circumstances.”
“that is against the backdrop of a quite shambolic position taken by the Respondent.”
“the involvement of a solicitor and, particularly, counsel in this matter was not warranted. Whilst there was a need to explore the facts, there were no legal issues of substance involved. The Tribunal could not see why the managing agent could not have presented the Respondent's case.”
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.