Service Charge Dispute
Commercial Properties – Service Charge Dispute
Unless the service charge is capped, these costs become unpredictable expenditure for any business. Whilst rent and business rates are fixed from year to year, landlords can dramatically and often unilaterally increase their service charge budget causing havoc to tenant budgets and profitability. GPC assist tenants by checking each service charge invoice against budget to approve sums and challenge those that should not be paid.
GPC apply a unique combination of legal and surveying expertise to all service charge disputes to promote quick, effective and economic solutions.
> Lease commencement: We advise on the service charge wording when new leases are being agreed in order to mitigate tenants’ obligations over the duration of the term.
> Early strategic advice during the lease: Landlords may wish to carry out large works during the lease and recover the costs through the service charge. We advise tenants on:
- Early dialogue between landlords and tenants.
- Determining whether the landlord should contribute towards the costs.
- How to avoid a conflict arising with the landlord.
- Advise tenants of the steps to take if a dispute does arise with the landlord.
> Repair v Replacement of items: As repairing items such as lifts and air-conditioning are usually less expensive than replacing the same, we advise tenants on whether the replacement works planned by landlords are essential or whether repairs may suffice at a lower cost. It is natural that landlords will wish to replace items rather than repair them and we advise on whether such replacement is actually required or whether repair at a lower cost would suffice.
> Relationship between dilapidations and service charges: Close to lease end, landlords often plan large replacement and repair works such as lifts, air-conditioning and escalators. Some of these are planned to be recovered via a schedule of dilapidations and some via the service charge. Different rules apply to each and we understand these and use this knowledge to our clients’ advantage.
Residential Block – Service Charge Disputes
Service charge disputes could be of many forms but often result from the leaseholder suggesting that the landlord has either collected service charge and has not carried out repairs, or expenses are not reasonably charged or management is not done effectively. Alternatively the landlord might be planning to undertake repairs and maintenance and the leaseholders may disagree that the work is either necessary or question the extent of it and the cost.
In particular we deal with many queries where Section 20 Notices have been served by landlords and the leaseholders require advice as to how to deal with the statutory process.
For further details or assistance please contact us on 0207 993 4890