Justin Madders MP told the Commons last week that leasehold sector debt collectors JB Leitch loaded a bill for unpaid ground rents by 222%.
JB Leitch, a Liverpool legal firm, is routinely engaged by ground rent investors such as Long Harbour and the Tchenguiz group.
Mr Madders, the Labour MP for Ellesmere Port and Neston, said:
“Constituents of mine who are leaseholders recently received a letter from a firm of solicitors called JB Leitch about some outstanding ground rent.
“What was particularly outrageous about the letter was that it included additional fees for late payment equivalent to 222% of the original ground rent charge, despite this being the first correspondence that my constituents had received on the matter.
“That is typical of the way in which leaseholders are being exploited in this country. May we please have a debate on how we can stamp out these terrible practices?”
Leader of the House William Rees-Mogg replied:
“The Government are well aware of that issue, and I think that it might well be covered by legislation that is in the pipeline. I think that that would be the occasion on which to debate it.”
LKP has raised the issue of JB Leitch’s very high fees on leasehold debts and questioned whether the firm is remunerated at all by the freeholder employing them, or is solely remunerated from whatever fees are paid by the debtor.
JB Leitch has been an assiduous sponsor of the conferences of the taxpayer funded Leasehold Advisory Service (set up to protect leaseholders):
LEASE ” Sponsors
4site Consulting provide a comprehensive Health & Safety compliance service for the residential and commercial property management sector. We provide a range of impartial Health & Safety risk assessments and Asbestos surveys to fulfil your management duties and legal obligations.
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JB Leitch, a name all too familiar to me when I ran my own company specialising in helping retirement developments to go “Right to Manage”.
Their technique when dealing with RTM Companies was to immediately threaten a winding up order for any disputed payments, even if the figure in question was very small. The solicitors’ Code of Conduct state that such notices should only be used as a last resort and after normal debt collection procedures had been exhausted, but JB Leitch used them to intimidate the elderly RTM directors into submission. Of course a winding up order would mean the cessation of the right to manage. And it gave JB Leitch an excuse to load costs onto the claim.
I complained to the Solicitors Regulation Authority that JB Leitch was in breach of section 11 of the Code of Conduct (not take unfair advantage of those they deal with and that they act in a manner which promotes the proper operation of the law) but, inevitably, I received an anodyne response.
Sad, but not surprising, to see JB Leitch has not changed.
Steve Cieslik
Yes, a deeply unpleasant firm. The pronunciation of their name is correct, but it’s misspelt – it should be J B Leech.
Freeholders using JB Leitch are mainly of the unscrupulous variety – usually following their own intimidating efforts at collecting undue and questionable sums.
The usual trick is to state a GR demand was posted, when it was not, or was sent to the “wrong address”. This is a money making scam -and in my experience practiced usually against hapless and unsuspecting individuals who the freeholder and JB Leitch believe can, under threat of Court action, be scared into making payments.
I welcome the comment of Rees-Mogg : “the Government are well aware of that issue, and I think it might well be covered by legislation that is in the pipeline.”
Let’s hope the pipe is short, stubby, and fully filled…….
JB Leitch also act for the Regis Group, well known to LKP and the Courts and Tribunals Service. I withheld disputed service charge amounting to £1,581.000. JB Leitch’s fee lodged in court £10,595.00. JB Leitch had failed to serve a letter-before-claim – the court dismissed the costs saying to their barrister “You know the rules”. Courts discretion as to costs : Rule 44.2 No order as to costs “Each party is to bear that part’s own costs of the part of the proceedings to which the order relates whatever costs order the court makes at the end of the proceedings”. Ignoring Rule 44.2, JB Leitch issued an invoice in the sum of £2,435 stating “You will note the order does not provide that costs are not to be recovered via the general service charge account …” This invoice will be included in a future case to be taken to the First-tier Tribunal Property chamber. (I call JB Leitch rottweiler lawyers, although I know this is disparaging to rottweilers!)