The biggest payout to leaseholders – ever!
The £1 million settlement to residents in September last year at St George’s Wharf, Vauxhall, is the biggest settlement ever made to leaseholders.
This is the article written by Sebastian O’Kelly in the Mail on Sunday on September 19 2011.
It can be read here or Mailonline
http://www.dailymail.co.uk/property/article-2039128/MARKET-WATCH-Flat-owners-win-record-1m-payout.html
The troubled property management firm Peverel – once part of the empire of tycoons Vincent and Robert Tchenguiz – has failed to prevent a record, near £1 million settlement before a Leasehold Valuation Tribunal ruling earlier this month.
It is the biggest-ever payout in an LVT action, made to leaseholders at St George Wharf in Vauxhall, opposite Westminster, which has been home to John Major, Chelsea Clinton and Lee Ryan of boy band Blue among others.
Penthouses in the complex can sell for £7million and annual service charges, even for a two-bedroom flat with nondescript views, start at £5,000 a year.
Luxurious: Penthouses at the St George Wharf in Vauxhall, can sell for £7million and annual service charges start at £5,000 a year
Luxurious: Penthouses at the St George Wharf in Vauxhall, can sell for £7million and annual service charges start at £5,000 a year
For four years, the residents have been fighting Peverel’s excessive management charges stretching back over a decade, as well as the company’s practice of employing its own subsidiaries to provide CCTV and insurance services.
The settlement could not have come at a worse time for Peverel, which has been in administration since March when the Tchenguiz brothers were arrested by the Serious Fraud Squad. The company is now being administered on behalf of Bank of America and is seeking a buyer.
A near £1 million settlement exceeds the previous record LVT ruling of £730,000 in September last year to tenants at the Weekday Cross scheme in Nottingham, which was also managed by Peverel.
St George Wharf residents’ association, which previously had never been backward in publicising their grievances, have signed a confidentiality agreement as part of the settlement and are awaiting their cheques.
As a result of the secrecy surrounding the settlement, Peverel even issued the absurdly misleading statement that: ‘Peverel was not party to the Leasehold Valuation Tribunal application, is not one of the named respondents in the case and was not party to any settlement negotiations.’
This should not have happened… We should have admitted this earlier and publicly, and we owe the residents an apology
Although the leaseholders’ action was against the landlord and developer, St George – part of the Berkeley Group – the tribunal documentation is littered with complaints against Peverel and its web of related companies. In addition, Peverel’s own in-house solicitor, Claire Banwell Spencer, fought the leaseholders’ action and employed a barrister to help her do so.
The leaseholders’ claims included £716,000 for excessive management fees, £472,000 for over payments for door-entry systems and CCTV – the former provided by St George and the latter provided by Peverel’s own Cirrus Communications – and £263,000 for excessive insurance costs, provided by Peverel’s company Kingsborough, for which St George trousered £65,000 in commission, it was claimed.
Peverel claims that it is a ‘misunderstanding’ to believe that the residents’ complaints concerned overcharging, and that the dispute was ‘primarily about apportionment of costs between blocks within the development’.
Although St George, or the Berkeley Group, whose founder is the legendary property figure Tony Pidgley, will be writing the cheques to refund the residents, it is understood that it will be expecting Peverel to divvy up for its share in the fiasco. Last September Berkeley sacked Tony Carey, the former MD of St George, who is fighting an unfair dismissal action against the company.
‘Problems at St George Wharf have caused us considerable reputational damage,’ says Rob Perrins, CEO of the Berkeley Group. ‘This should not have happened and the residents should not have had to fight this for four years. We should have admitted this earlier and publicly, and we owe the residents an apology.’
Peverel still manages 22 developments for the Berkeley Group, and is one of 12 managing agents the company uses. There are no plans to employ Peverel on any Berkeley schemes nearing completion.
Earlier this year The Mail on Sunday ran a series of articles detailing how residents in retirement flats were being loaded with excessive management charges and stealth charges. Many of the complaints involved Peverel.
