Getting your service charge demands correct


Author: Alison Mould


As owners of residential properties will be aware, the Landlord and Tenant Act 1987 states that any written demands for service charge must contain “the name and address of the landlord”. A recent decision of the Upper Tribunal (Lands Chamber) may well be important to them.

In that case the service charge demand contained the name of the landlord but gave the address of the landlord’s managing agents. That situation may well be common. Managing agents normally run service charge funds and whilst demands may be sent in the landlord’s name, the agent’s address would be used.

The Upper Tribunal (Lands Chamber) decided that such a demand is invalid. They said that the Act states quite clearly that the written demand is to contain the name and address of the landlord, and that the name of the landlord and the address of the agent is therefore invalid and insufficient.

This means that service charges may not be due.

At first blush that could be disastrous. The situation can be remedied by simply re-invoicing and ensuring that the new invoice contains the landlord’s name and address. That would obviously impact on the date from which any interest due from the tenant is to be calculated.

Further, owners of residential properties will also be aware that service charges have to be demanded from residential tenants within 18 months of that expense being incurred by the landlord.

It is quite foreseeable, therefore, that a landlord may lose its right absolutely to recover sums under a service charge if a demand is sent out late within the 18 month period and that demand uses the agent’s address. A landlord may well find it is then too late to re-invoice the sum, correctly.

Landlords would therefore be well advised to check with their agents now to ensure that invoices are being properly addressed. Similarly, agents would be well advised to check that their address is not appearing on service charge invoices.

Alison Mould, Partner, Fladgate LLP (amould@fladgate.com)

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