Property manager Richard Davidoff has won a retraction and apology from two young ex-employees who posted fake customer reviews online, but fines from regulators are piling up.
The lawyers of the two ex-employees apologised in open court earlier this week to Mr Davidoff, his wife and daughters who work in the family’s businesses and ABC Block Management and ABC Hendon. They also retracted allegations of criminality. This brings to an end a controversy that friends say has cost the two £60,000 each in legal costs and settlement.
Meanwhile, the Property Redress Scheme has made three rulings totalling £16,000 against Mr Davidoff’s ABC Estates, based in Edgeware, north London.
These come on top of Mr Davidoff personally being found to have failed in his fiduciary duties as a section 24 court appointed manager at a site in south London in August last year. Major works estimated at his appointment at £10,000 were revised upwards to nearly £100,000, the tribunal found.
In addition, Mr Davidoff was not a “satisfactory witness”, was arrogant and dismissive of the leaseholders and had proposed to entrust the major works to a company, Valens Contractors Limited, whose sole director was the wife of Mark Reed, the head of block management at ABC Estates.
“Any criticism of the conduct of the manager will be examined with care, because they are made against the manager in his capacity as an officer of the tribunal,” said Judge Robert Latham.
The ruling resulted in ABC Estates being expelled from the Association of Residential Managing Agents, while Mr Davidoff was personally expelled from the Institute of Residential Property Managers and Mark Reed resigned while his conduct was under investigation.
The property tribunal also revised its procedures for appointing section 24 managers as a result of the case.
The Property Redress Scheme, “a government authorised consumer redress scheme for lettings, property management and estate agents and other property professionals”, has made three recent decisions concerning ABC Estates lettings and block management business.
On 3 February 2022 the PRS ruled that it should pay £10,400 to the landlord of two houses which were rented out to tenants who subsequently established cannabis farms (case: PRSC107934). No criminal proceedings have resulted from this and there is no suggestion that ABC Estates had any knowledge that the buildings were being used for illegal activity.
The issue considered the service provided by ABC Estates and in particular the vetting of the tenants.
“I am unable to find that the agent performed referencing to the standard reasonably expected by the landlord,” the PRS ruled, adding:
“It is not within the authority of the PRS to make awards to the landlord for allegedly criminal activity, however, the PRS is able to compensate the landlord for losses incurred as a direct and foreseeable result of the agent’s poor service and compensation for the stress and inconvenience.”
The landlord estimated the damage at the two properties would cost £150,000 to put right.
The case was covered on The Guardian website on 9 January 2022:
Landlord faces £150,000 bill after tenants turn homes into drug farm
When Shreena Shah went to check on one of her rental properties, she says she was greeted by an unlikely scene – a man dismantling equipment used to produce cannabis. It was not the first shock she had to endure. Shortly before, the police had discovered a cannabis farm in the other rental property she and her family own.
An earlier PRS decision of 20 December 2021 (case: PRSC107563) ordered ABC Estates to pay up £5,000 to another landlord after a letting breached rules for “houses of multiple occupancy”.
And on 21 January 2022 ABC Estates was ordered to pay £1,550 to the 46 Falcon RTM Company (case: PRSC107939). This was a dispute in which leaseholders had to launch a right to manage action as Mr Davidoff had ended up as the sole director of the residents’ management company at the site.
The case was reported here:
The property tribunal had awarded costs against Mr Davidoff’s associated company Boccel Management Limited, from which he had resigned as a director on 20 October 2021 and ceased to be the person with significant control. ABC Block Management resigned as a director a little later on 31 December 2021.
Boccel Management Limited has no active directors and has a compulsory strike off notice against it. It was not in a position to pay the property tribunal’s £1,550 cost award.
Mr Davidoff argued at the PRS that the costs were awarded against Boccel Management Limited, but the PRS decided that ABC Block Management should none the less pay up.
The PRS makes decisions rather than issues fines. However, failure to abide by the decisions by companies that are signed up to it can lead to expulsion. That in turn can lead to the end of the business.
The FTT decision on costs can be read here
Related posts:
Sir Peter Bottomley calls on ministers to listen to ‘whistleblower’ ex-employees of Richard Davidoff (of ABC Estates)
Two former employees of ABC Estates ‘face £60,000 each in costs after libel claim, and must apologise in open court’
Two ex-employees of ABC Estates fail to stop Richard Davidoff defamation action over critical Google reviews with fake names (and ‘face £36,000 costs so far’)
Richard Davidoff of ABC Estates expelled from IRPM
Richard Davidoff, of ABC Estates, ‘breached his fiduciary duties’ after disastrous performance as a court-appointed manager, rules property tribunal
Conservatives and RICS kicked back at insurance kickbacks in 2006. Unfortunately, they did nothing about it – and here we are
Where does this “ Face paying out £60’000 each” come from…… The case didn’t go to trial.
If it had done and they lost I doubt that the judge would allow the claimant such costs on an indemnity basis.
The 2 individuals involved, backed down and apologised. Something doesn’t add up.
Am jolly glad that I fought the case brought against me and WON!!
Words wield no STRENGTH unless the speaker/ writer of those words has COURAGE.
I presume that the 60K quoted for each former employee was a settlement figure to prevent the case going to full trial. For each former employee, it would have been comprised as follows:
1. Costs of letter before action
2. Costs of obtaining Norwich Pharmacal Orders against several service providers
3. Costs of issuing the High Court libel and defamation claim
4. Costs of defending the former employee’s application to strike out the libel and defamation claim (paper submissions)
5. Costs of defending the former employee’s application to strike out the libel and defamation claim (oral and paper submissions at High Court hearing in Dec 2021)
6. Costs of amending the High Court libel and defamation claim
7. Damages in the sum of 25K
It should be noted that in addition to a solicitor, ABC and the Davidoffs used 2x Barristers to represent them – one of whom is a QC.
I presume that the apology / statement in open court was an essential part of the settlement. I further presume that the former employees were concerned that should the case have gone to full trial, then the whole thing might have cost them even more.
Nah, I disagree. I believe that the Judge would not have been impressed that a QC was appointed for such a case which seems unwarranted. I had a very sharp young Barrister in his field of (Defamation,Harrasment) plus a solicitor for a 2 day Trial at RCJ,returning several weeks later for the verdict. Think my legal fees amounted t £47’000. Managing agent had to pay of course! They were refused permission to appeal. I never go looking for a fight but I will finish it.
The £60’000 a piece for pre trial seems nonsense to me. Shame the two individuals involved didn’t have the conviction to go to trial. They may well regret it. Oh well, not everyone has my cojones!!
With so many fines against them, it is a wonder that the Property Redress Scheme (PRS) has not terminated ABC’s membership.
The example of running a house of multiple occupation (HMO) without a HMO licence is very serious indeed. I know of one landlord who got caught out on this and was made to pay a £30,000 fine to his local council. The tenants of his property also got rent repayment orders – refunding all the rent payments they had made for the previous 12 months whilst the property was unlicensed (another £24,000).
The council sympathised with the landlord’s argument that it was the letting agent’s fault that the property been turned into a HMO without the requisite licence. There was no difference to the outcome though. The landlord was still liable to the pay the £54,000.
Well, doesn’t as though ABC would be going to trial with clean hands given it has fines against it. I would like to know what LKP advised the 2 individuals involved to do.
I do hope that this case does not intimidate leaseholders into withholding critical reviews of managing agencies.
“Look”
Was your case published and if so do you wish to share it with us
All cases are a matter of public record. I see absolutely no point it sharing details “ my journey” on comments forum. To what end? I did ask LKP if it would allow to me to write a piece about the matter including the trial and the incident leading up to the trial. I was magnificent . The Judge in her summing up said that I was “Articulate and at times seemed to command the Court”. I won on ALL counts.
I do not mean to sound patronising or arrogant , but ‘ My Story’ requires a much more elevated platform than a comments forum. I pitched it to MSM and there was interest the covid matter happened and the media were focused on that. I might write a book.. Hmmmm, must think of a title. ‘. Leasehold is a feudal cesspit and the many not the few that operate in it are parasites’ Too long?
Your version of events indeed shows you had a very interesting case and it would appear a surprising decision that the LKP did not let you write an article which they could publish.
In broad terms what do you think was the reason why they are. I supporting your case
Dunno, I suggest you put your question to LKP. I was a bit surprised because it was a real scoop and i believe that many Leaseholders would have found my account of not being intimidated and bullied by a managing agent empowering. I will continue to keep my powder dry. There will come a day of publishing. I have patience. Slowly slowly catchee monkey! It still has legs and I will not hold it against LKP because their cause is my cause. ABOLISH LEASEHOLD/ REGULATE MANAGING AGENTS.
actually you are coming across as very patronising and arrogant. Assuming you are not trolling.
Dave, always start a sentence with a CAPITAL letter. I think we both know that you are not ‘ bigcahones’…Am not trolling, am a committed ABOLISH LEASEHOLD/ REGULATE MANAGING AGENTS campaigner .What are you doing to end this feudal cesspit of a scam otherwise known as ‘ Leasehold’. ?
Your case, as you have advised, would help others, but you decline not to share details of your success, Yet you criticize others and ask what they are doing to end this “feudal cesspit”
Therefore, if you are not prepared to share the detail of your case, what is the point of your posting on this forum. You hold no respect for the LKP
The ‘ details of my success’ is that I refused to be intimidated by a managing agent, took them on and whupped their arses. The end. My fellow leaseholders can do same. It’s called having the courage of your conviction and chutzpah.
Won’t bother to respond to your second paragraph as it reads as nonsense, suffice to say that I stand shoulder to shoulder with LKP in its campaign to ABOLISH LEASEHOLD/ REGULATE MANAGING AGENTS. The feudal cesspit of leasehold will come to an end. UNITY = STRENGTH
Great that GR speculators portfolios are not looking as rosy as they thought now that doubling GR scam has been curtailed.
Couldn’t happen to a more worthy bunch. Now little stevie, we must really end this fruity little commentary. People might talk…… Buy my book, ‘ Leasehold is sewer of scammery’. In all the best bookstores
Memo to Dave and Stevie, I have a Mafia Managing Agents = Leasehold Misery , REGULATE NOW! petition on FB.
C’mon sign it and share it. Lets end this legalised extortion racket – together
Don’t know how to send the link but you’ll find me✊