Tenant Successfully Challenges Administration Charges for Ground Rent Collection

OUTCOME: Allowed

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FIRST-TIER TRIBUNAL PROPERTY CHAMBER (RESIDENTIAL PROPERTY)

Case Reference

:

HAV/00HP/LVA/2024/0500

Property

:

[ADDRESS], [POSTCODE]

Applicant: [redacted]

:

Respondent: [redacted]

:

[RESPONDENT] of Application

:

Determination as to liability to pay an administration charge Schedule 11 Commonhold and Leasehold Reform Act 2002

Tribunal Member

:

Regional Tribunal Judge Whitney

Date of Decision

:

30 April 2025

FINAL DECISION

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1. The Applicant made an application for determination as to the liability to pay administration charges. The application was received on 14 August 2024.

2. The Applicant further sought orders pursuant to Section 20C of the Landlord and Tenant Act 1985 and paragraph 5A of Schedule 11 of the Commonhold and Leasehold Reform Act 2002.

3. This application relates to 3 administration charges of £60.00 paid to the Respondent which is stated to be administration charges for rent collection which was added to the annual ground rent.

4. Directions were issued on 12 February 2025 setting down the application for a case management and dispute resolution hearing on 9 April 2025.

5. The Applicant was in attendance at the hearing. The Respondent did not attend and did not contact the Tribunal prior to the hearing to request an adjournment or provide a reason for its non-attendance.

6. The Applicant confirmed that a statutory ground rent demand was served. The invoice which included the fee for collecting the ground rent did not include any summary of rights and observations.

7. The Applicant had filed a detailed positions statement and attachments. These were sent to the Respondent. These included an email from Mrs [RESPONDENT] dated 4 June 2024 which referred to clause “4 12 9” of the lease as the authority for the charge. I presume she was referring to clause 4.1.2(p) of the lease. This states:

“(p) To employ at the discretion of the Landlord a surveyor accountant or other individual firm or company in connection with the surveying or accounting functions or the management of the [NAME] and (in the entire discretion of the Landlord) to appoint managing agents in connection with the management of the [NAME] collection of Service Charge and performance of the Services and any other duties in or about the [NAME] or any part of it including the general management administration security maintenance protection and cleanliness of the [NAME] and to pay the proper fees of such persons”

Further the Applicant provided copies of various Tribunal decisions upon which he relied.

8. I issued a preliminary decision dated 9th April 2025. I directed that if any party wished to make representations they could do so by 24th April 2025. This decision was sent to the Respondent.

9. No representations were received. I make a final decision.

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Decision

10. The Tribunal accepts the Applicant’s arguments and is satisfied that the Respondent is not entitled to recover the administration charges which are the subject of this application as no summary of rights was provided with the demand that was sent. Further I accept the submissions of the Tribunal that even if a summary was attached the clause relied on under the lease does not allow recovery of a fee for collecting ground rent. This clause relates to service charges and I take account of the various decisions to which I am referred, whilst not binding upon me, I accept that the Respondent is not entitled to charge a fee to the leaseholder for demanding and collecting the ground rent due under the lease. Any expense incurred is an expense for the Respondent to bear out of its ground rent income.

11. I determine that the Applicant is not liable to pay the three demands of £60 and that such monies as have been paid should be refunded.

12. Further I make an order pursuant to Section 20C of the Landlord and Tenant Act 1985 and paragraph 5A of Schedule 11 of the Commonhold and Leasehold Reform Act 2002 and in addition, order that within 28 days of the issue of this Decision, the Respondent shall reimburse the Applicant’s application fee of £100.

RIGHTS OF APPEAL 1. A person wishing to appeal this decision to the Upper Tribunal (Lands Chamber) must seek permission to do so by making written application by email to [EMAIL]

2. The application must arrive at the Tribunal within 28 days after the Tribunal sends to the person making the application written reasons for the decision.

3. If the person wishing to appeal does not comply with the 28 day time limit, the person shall include with the application for permission to appeal a request for an extension of time and the reason for not complying with the 28 day time limit; the Tribunal will then decide whether to extend time or not to allow the application for permission to appeal to proceed.