Landlords can increase fees, but must explain their reasons
Published 26/07/2010 | 08:00
Question: My landlord, Heart Lets, is raising my maintenance fee for common services from £60 to more than £90 per month.
The annual management charge of £175 is going up to £216. Do I and the other 14 leaseholders have to pay?
Answer: Heart Lets says the service charge has not increased for four years, and the previous managing agents did not perform their duties properly.
It adds: "If [Heart Lets] had left the service charge as it was, then there would not have been enough money in the fund to provide the services, and the lessees would suffer." It adds that the freeholder offered to meet you to explain the charges, but you declined to do so.
An explanation has now been provided to you over the phone. Heart Lets says any money raised from the charges and not spent will be returned to the leaseholders.
Managing agents have a legal duty to explain increases in management charges. Nicholas Kissen, a solicitor at the Leasehold Advisory Service, explains: "The Service Charge Residential Management Code, published by the Royal Institution of Chartered Surveyors and approved by the Department for Communities and Local Government, says that managers should always notify tenants of significant departures from the budget, and should be willing and able to explain the reasons for them.
"If your managing agents cannot give you a satisfactory explanation for the increase then, while there is no absolute recourse, their refusal might be taken into consideration in any future leasehold valuation tribunal hearing relating to the charges."
A managing agent can only charge for items specified in a lease, while charges for repairs must be limited to what has been "reasonably incurred for works and services of a reasonable standard", says Mr Kissen.
Question: Two years ago I was contacted by a firm called Buy Bye Credit, which promised to clear my credit card debt on the grounds that my credit card agreement was flawed. I paid £1,050 for "legal services", but Buy Bye Credit is not in business now and it did not clear the debt. Can I recover my losses? SW
Answer: As you say, Buy Bye Credit appears to have ceased trading. The company's website no longer functions, and there is no phone number for it currently listed at its Birmingham address.
The company's accounts are overdue with Companies House, and there is a proposal to strike out the company's registration. A search on the internet reveals many other unhappy clients of Buy Bye Credit.
You are one of many readers who have complained after paying to have debts eliminated that remain in place.
But you are fortunate because you paid Buy Bye Credit using a Capital One credit card, making the card issuer jointly liable with the vendor for the provision of services paid for. We contacted Capital One on your behalf and it is refunding the £1,050.
Question: I hold power of attorney for my 80-year-old mother and manage her bank accounts online.
I applied in October to open a Santander online Saver 6 account and transferred the funds from two online Saver 2 accounts.
By January they were still not accessible online. I was told the balance from one of the Saver 2 accounts had not been transferred, and I was promised £10 to compensate. By February, none of this had happened. I was then told for the first time to complete a new power of attorney form.
The accounts were still not accessible online in March, when I was told the interest rate on the Saver 6 account was no longer attractive, and that I should open a Saver 7 account. I am told the Saver 7 account is now open, but I still cannot access it online. LL
Answer: Santander says that the problems occurred because the power of attorney was not registered specifically with the new account. It will credit your mother's account with £50 to apologise for the delay.