If you’re a tenant of a long leasehold residential property, then you have a raft of legislation protecting you and providing all kinds of rights.
One of these is to force a landlord to provide the complete service charge accounts and show the invoices and receipts. When you’ve been having iffy service and questionable changes, this can be essential to help dig deeper into where on earth all the service charge monies disappear to.
The technical piece of legislation that provides this right is under Sections 21 and 22 of the Landlord and Tenant Act 1985 (LTS 1985), and there’s already plenty of legal information available to explain the detail and even send a letter off to the landlord - one good example is the here at Lease Advice.
However, before you get carried away, here are some pointers to help place in context. From property management rather than a purely legal perspective, this can help determine just the right course and angle for your situation.
1. Trying Requesting Nicely
It may sound obvious, but try a simple request for the information you need from the landlord or managing agent directly. Not only can this form part of any general conversations, and even minuted from meetings, but an actual request in writing for certain things, whether a letter or simple email.
Hopefully, this can be nice and friendly, but with a bit of pressure to say that you will need to take further advice and action if required. But, on the other hand, it states everything in writing and helps get to the point.
If you’re representing others as well, whether through a management company or residents’ association, or advisor on their behalf, then clearly say on who’s authority this is.
It may also be worth a copy to these other parties and other landlord advisors, such as their accountants or solicitors.
2. Check What Rights You Have
So if you own a long leasehold residential interest in a property, then you will have these legislation rights, but there may be other more general ones as well, such as through the Freedom of Information Act.
Also, check individual leases, which is the golden rule. This will always shape your own contractual obligations, such as any specific timescales, pieces of information, and penalties for the landlord providing the correct information.
3. Request a Summary Under Section 21 of the LTA 1985
Getting down to the legal rights, you can first request an official summary of the accounts, which are the basic figures to delve into.
For properties with more than four dwellings, these will need to be certified by a qualified accountant and cover accounts for the latter of 1 month from the request or six months at the end of the accounting period.
There’s a template letter to use at Lease Advice here, and even though you may be having separate conversations and information supply with the landlord, this can help focus their minds that you mean business.
4. Request Copies of Information Under Section 22 of the LTA 1985
The second aspect of the information is the actual copies of individual receipts and accounts and any associated data, with a sample letter.
However, this can only follow the above initial request for a summary, in fact, within six months after the summary has been received. It also only relates to the latest accounts or the last twelve months.
Once they receive the request, it must be issued within one month and be available for two. They must make these available for you to come and inspect, with copy facilities available for you to make copies of things.
All good news, although watch out for any costs creeping in for this, and remember that half the battle is to keep the landlord on their toes and know that you’re on to things. Having sight of all these accounting items might seem significant. In contrast, you need to spot the context and head straight to the real bottom-line issues right away rather than going through this potentially lengthy process.
5. Take Further Judgement
If things don’t go to plan and you’re not getting the feedback and information, there are rights to progress primarily through the First-Tier Tribunal.
In reality, of course, this can be a hassle in terms of timeframes and costs in the context of simply needing information, but the threat of this can help, and if you do need these and it’s a straight case of the landlord not playing ball then these rights are there to be used.
6. Formal Complaints
Another angle of taking the matter further for not getting the right answers is looking at the process for that particular landlord or managing agent to address the issue.
This might be within the business, say, their procedure for dealing with complaints or contacting the scheme and organisation they are accredited to.
Again, the main benefit at this stage is to show that you mean business, and simply requesting their complaints procedure or line manager in a friendly way can show that this problem is not going away.
7. Pick Your Battles
The final point is to make sure that all this hassle is worth it all. Seeing these figures and backup paperwork is, of course, important, but all the cost and time involved in seeing it through can be just too much.
Therefore check that this is genuinely needed and valuable. Tempers have not risen so high that it’s more a case of proving a point, particularly with, for example, an outgoing managing agent.
What can sometimes be more helpful is just the skilful use of beginning this process to show that you know what you’re talking about and mean business if needs be, and therefore enticing them to provide the information eventually.
Cracking the Whip
So as you endeavour to find the truth about service charges at a property, these above points will first help you ensure all bases are covered and your situation dictates.
Secondly, you can send the actual requests in whatever form with specific details you require.
This thirdly prepares you for the results, not only the actual information you receive but also how the landlord-tenant discussions subsequently go to make sure all the service charges are fair and square.