Tenant Wins: No Service Charges Without Lawful Demands

OUTCOME: Allowed

© CROWN COPYRIGHT 2025

FIRST-TIER TRIBUNAL PROPERTY CHAMBER (RESIDENTIAL PROPERTY) Case reference : LON/00AE/LAM/2024/0034 and LON/00AE/LSC/2025/0671 Property : Flats 5 & 11 [ADDRESS], [POSTCODE] Applicant : [redacted] : - Respondent : [redacted] : - Type of application : Transfer from County Court [0671] Service and Administration Charges Appointment of Manager [0034] Tribunal members :

Judge Shepherd The Hon. Michael J F Donaldson FRICS Venue : 10 [ADDRESS] [POSTCODE] Date of decision : 14 November 2025

DECISION

2 1. We have been asked to consider an application for a determination as to the reasonableness (and payability) of service charges. The matter started life in the County Court as a claim for service charge made by the Respondents, [APPELLANT] (“The Respondents”) against the Applicant leaseholders, [COMPANY] (“The Applicants”).They own the leases of two properties [ADDRESS] [POSTCODE] and [ADDRESS] [POSTCODE] (“The premises”). The Respondents are the freeholders of these premises.

2. The case was transferred to the Tribunal by Deputy District Judge Dray at Clerkenwell and Shoreditch County Court on 16th January 2025. Although the order does not reflect this, the purpose of the transfer was to allow an expert Tribunal to assess the reasonableness and payability of the service charges. Judge Martynski gave directions in the Tribunal on 25th June 2025. The Respondent failed to comply with any of the directions.

3. The sum sought by the Respondents in the County Court proceedings was £8248.51. There is no breakdown of how this sum is made up. The Applicants defended the County Court proceedings and sought a counterclaim in disrepair. They argued that the Respondents are in breach of their obligations under the lease by failing to carry out essential repair works at the premises. In particular this related to water damage to the premises which has not been properly rectified.

4. In their statement of case for the Tribunal the Applicants further elaborated on their defence. Amongst other arguments they stated that none of the service charges sought by the Respondents were due because they had failed to serve lawful demands for the sums owed. Under s. 21B of the Landlord and Tenant Act 1985 a demand must be accompanied by a Summary of Rights and Obligations. If the landlord fails to comply with this requirement the tenants are not liable to pay the service charges until such time they do ( s.21B(3)).

3 5. As well as challenging the service charges the Applicants made an application to appoint a manager due to alleged default by the Respondents. This application was stayed by Judge Martynski pending the determination of the service charge issue.

6. The Applicants were represented by Ms [NAME] and the Respondents by Mr [NAME]. At the hearing on 14th November 2025 Mr [NAME] explained that he was a friend of the Director of [COMPANY], [NAME]. He had been asked to attend on his behalf. Mr [NAME] was abroad attending to a family matter. He had tried to adjourn the hearing in an application made on 12th November 2025 but this application was rejected by Judge Bowers. 7. [NAME] accepted that the Respondents had failed to comply with the directions. He did not seek to excuse this but explained that the Respondents were in between management companies at the time and so had failed to recognise the importance of compliance.

8. The consequence of this failure was no documents had been submitted on the Respondents’ behalf. Crucially absent was an explanation for the breakdown of the service charges alleged to be due and any evidence of lawful demands having been sent to the Applicants. This put the Tribunal in a difficult position because we were unable to analyse in any detail the reasonableness and payability of the service charges sought. One thing was clear however - there was no evidence before us of any lawful demands having been sent and the consequence of this is the inevitable conclusion that none of the sums sought by the Respondents are due and owing.

9. In summary the sum of £8248.51 sought by the Respondents is not currently due and owing.

10. Directions with regard to the Appointment of Manager application are given separately.

Judge Shepherd 14th November 2025

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ANNEX - RIGHTS OF APPEAL Appealing against the tribunal’s decisions

1. A written application for permission must be made to the First-tier Tribunal at the Regional tribunal office which has been dealing with the case.

2. The application for permission to appeal must arrive at the Regional tribunal office within 28 days after the date this decision is sent to the parties.

3. If the application is not made within the 28-day time limit, such application must include a request for an extension of time and the reason for not complying with the 28-day time limit; the Tribunal will then look at such reason(s) and decide whether to allow the application for permission to appeal to proceed despite not being within the time limit.

4. The application for permission to appeal must state the grounds of appeal, and state the result the party making the application is seeking. All applications for permission to appeal will be considered on the papers 5. Any application to stay the effect of the decision must be made at the same time as the application for permission to appeal.