If you pay a service charge, you have a number of important legal rights, including:
. A right to be notified in advance of any changes to your service charge
. A right to challenge your service charge at a Leasehold Valuation Tribunal
. A right to see a summary of the service charge costs for the previous financial year and to inspect the accounts and invoices on which the summary is based
. A right to a summary of the insurance policy for your building
. A right to be consulted about work which is likely to cost you more than £250 inclusive of VAT
. A right to be charged, or notified of service charge costs, within 18 months of the cost being incurred
. A right to be consulted where a service contract of more than 12 months (for example for gardening) will cost more than £100 per annum for each Leaseholder, and the contract is for more than one year
You will find more detailed information in the Landlord and Tenant Acts 1985 and 1987 and Commonhold and Leasehold Reform Act 2002, which should be available at your local library.
You can also contact LEASE (Leasehold Advisory Service) www.lease-advice.org.uk
Rights of long leaseholders
If you have a lease that was originally granted for more than 21 years (even if it has less than 21 years to run) the law classifies you as a long leaseholder and gives you special rights. If you own a leasehold flat bought under the Right to Buy scheme, this section applies to you. Please note that Shared Owners are not classified as long leaseholders and have a different set of rights - click here to be taken to the shared ownership section.
Your rights as a long leaseholder:
. The right to information about the landlord
This includes: the landlord's name and address, and an address in England or Wales where notices can be served; if your landlord is a company, you can write to the landlord for the names and addresses of all of the directors and the secretary of the company.
. The right to seek recognition for a tenant's association (RTA)
A recognised tenant's association (RTA) has additional rights. It can ask for a summary of service charge costs incurred; inspect accounts and receipts for the property in relations to service charge costs; ask to be consulted about the appointment or reappointment of a managing agent;and appoint a surveyor to advise on any matter relating to service charges. The surveyor will have the right to see and copy supporting documents held by the landlord, to inspect common parts, and to appoint assistants.
To gain recognition, the secretary of the association should ask the landlord for a written notice of recognition. Alternatively, you may apply to your rent assessment panel for a certificate of recognition. As a general guide, an association should represent at least 60% of the flats in the block in respect of which variable service charges are payable. Contact our Community Participation Team for more information on setting up a resident's association or about joining an existing one.
. The right to information about service charges and the right to challenge the reasonableness of those charges
A leaseholder or secretary of a recognised tenant's association may ask the landlord for a summary of the costs on which the service charge is based. Your landlord must provide you with a summary for the last service charge accounting year, showing:
o How the costs relate to the service charge demand or if they will be included in a later demand;
o Any items for which your landlord did not receive a demand for payment during the accounting period;
o Any items for which a demand was received and no payment was made during the accounting period
o Any items for which a demand was received and paid within the period
o Whether any of the costs relate to works for which an improvement grant has been or is to be received.
After you have received the summary, you also have the right to look at the accounts, receipts and other documents on which the summary is based, within six months of receiving the summary. You also have the right to challenge the reasonableness of any service charge or of the standard of works or services at a Leasehold Valuation Tribunal.
The right to be consulted about major works and long term agreements
Major works
If we plan to carry out works of repair, maintenance or improvement which would cost individual leaseholders more than £250 each, we must write to telling you what is proposed and giving you 30 days to comment. You may inspect the specification of the works during this period and provide us with the name of a contractor that you wish us to approach for an estimate.
We must obtain at least two estimates for the work. We will then write to tell you how much the works will cost and our response to any comments made during the consultation period. We will make the estimates available for inspection by leaseholders.
Long Term agreements
If we propose to enter into an agreement for the provision of services or works for a period of 12 months and the cost to you will be more than £100 per year we must consult you in writing about what we are proposing and why.. There will be a 30 day consultation period to allow you time to make any observations, which we must take into consideration. Within this period, you may also nominate a contractor from which you wish us to obtain try to obtain an estimate.
Once estimates have been received, we must write to you again giving you details of the estimates we have received together with the length of the proposed agreement. We will also provide an estimate of how much we think you will have to contribute and whether is likely to vary. We will also summarise any observations made by other leaseholders and our response to them. There will be a further 30 day consultation period allowed for you to give us your views.
If we do not accept the lowest tender, we must write to you within 21 days giving you reasons for our choice of contractor. We may only be able to charge you a limited amount if we fail to follow these procedures without dispensation from a Leasehold Valuation Tribunal.
Once we have entered into a long term agreement, we may still have to consult you on a more limited basis where we intend to carry out works which will cost you more than £250 under that agreement.
The right to information about insurance
If your service charge includes an amount for buildings insurance, you have the right to request a summary of our insurance cover. We will provide this within 21 days.
The right to take over the management of your block without having to prove that the landlord has failed in his duty to manage the property
Under some circumstances, you may be able to exercise the 'Right to Manage'. This is where a majority of qualifying leaseholders set up a management company to take over management of the building they live in. Not all buildings qualify for this right. The rules are quite complex; for further information click here. http://www.lease-advice.org/rtmframe.htm
Right to a service charge loan
If your home was originally sold by Kerrier District Council before 23 March 1998 but within the last 10 years, you may be entitled to a loan from the Housing Corporation to meet the cost of paying your for property repairs through your service charge. Loans are available for service charges amounts payable in excess of £1,500 in any one accounting year. The amount of the loan must be no less than £500 and no more than £20,000. The loan is secured by a mortgage against your property. If we think you may be eligible for a service charge loan, we will give you more information about this when we send you your service charge bill. If you want to apply for a loan, you must do this within 6 weeks of receiving your service charge invoice. Contact us for further information or click here http://www.communities.gov.uk/index.asp?id=1151336 to be taken to the website of the Department of Communities and Local Government.
