A landlord's star chamber
In the first of a monthly column on leasehold and freehold issues, Karen Woolfson reveals a cause for tenants to celebrate
Wednesday 20 August 1997
From 1 September, new regulations will be introduced giving leaseholders the right to challenge bills and to dispute proposed works. Perhaps even more importantly, this right to challenge the landlords will only cost a small sum of money. The new process will also simplify the often complex affair of dragging these wrangles through a county court.
New laws will give Leasehold Valuation Tribunals (LVTs) the power to deal with service charges and insurance. They will also give leaseholders the right to oust bad managers and appoint a new one instead, even themselves.
One tenant in Brighton told me he plans to "LVT" his landlord as soon as the new laws come into force. He claims his landlord doesn't reply to any letters, only sends threatening letters and has charged a massive pounds 29,000 for decorating the block.
The cost of taking your landlord to the Leasehold Valuation Tribunal will be up to pounds 500 for each application. However, the fee will be waived if you or your partner are on income support, family credit, disability working allowance, housing benefit or looking for work. The tribunal does not have the power to award costs, so there is no danger of you ending up with a massive bill should the application fail to succeed.
To prevent landlords trying to push up service charges to pay for their own costs, such as solicitors or surveyors, tenants are advised to apply for a "Section 20c" order at the tribunal. This will ensure that even if your landlord turns up with eight QCs, you won't have to foot the bill.
John Mitchell, one of the five leasehold victims who set up the Campaign Against Residential Leasehold Abuse (Carla), is already advising many of his members to take the LVT route. His own unpleasant experiences with landlords inspired him to take action. After setting up Carla in October 1995, he was involved in drafting new regulations which have helped shift the balance towards tenants and to put rogue landlords behind bars.
One group of people he will be recommending take the LVT route live in a block of 15 flats in East Anglia.
Most of the tenants in the block owe about pounds 8,000 each to the management company, but they allege they have been overcharged, that no estimates were provided (which is a legal requirement) and that the accounts are unclear.
The tenants are now being threatened with legal action and the beauty of the new regulations is that the landlord cannot enforce payment until the amount demanded has been declared reasonable through an LVT or court.
So if you are being overcharged for repairs, maintenance or anything else, you won't have to pay a bean until the Tribunal is satisfied the landlord's demands are bone fide.
It is likely that many tenants who take their dispute to a tribunal will also want to oust the current manager and appoint a new one. It would be a good idea to prepare yourself with lots of evidence to support your case before applying to the tribunal. Bear in mind, however, that the sooner you get the evidence together the better as a large number of applications are expected from day one.
There are currently 11 LVTs in England and Wales, so find out which one is closest to you. Each one is made up of a lawyer, a valuer and a lay person and the hearings are semi-formal. You don't need a solicitor or barrister to represent you, though professional assistance is probably a good idea.
This system marks a fundamental shift in power towards tenants and away from landlords, though it is only one step towards the government's promised radical overhaul of the system. The eventual outcome is likely to be the elimination of the concept of leaseholds altogether, giving people the right to own and manage their property.
Details of how to apply to an LVT will be covered in a report next weekn
Karen Woolfson welcomes letters from readers for her monthly column on leasehold and freehold issues. Her address is: Home Battles (c/o Nic Cicutti), Personal Finance Section, The Independent, One Canada Square, Canary Wharf, London E14 5DL. Karen regrets she is unable to reply personally to all letters.
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