Leasehold Valuation Tribunals dealing with sub-letting issues are referring to the precedent established in February by the Land Tribunal by slashing landlords’ supposed administration fees.
The fees have long been resented by leaseholders as the consent and registration of a sub-letting are regarded as simply a try-on by landlords, even though a charge of some sort is usually referred to in the lease. £100-135 plus £75 for registration have been routinely charged.
In February the Land Tribunal under George Bartlett, QC, combined four appeals together and ruled that sub-letting fees should be around £40.
Anyone involved in a dispute with a landlord could offer this sort of sum and be in with a fair chance that that would be the end of it.
Justin Hempson-Jones, 33, a civil servant, is the latest to win an LVT ruling on sub-letting fees, and his case is interesting because the tribunal referred specifically to the Land Tribunal ruling, even though he began the action in December last year. The decision date was April 5.
In 2007, Hempson-Jones bought his one-bedroom flat at Barratt’s Vanguard House complex in Hackney, north east London, and let it out last year.
Like many other housebuilders, Barratt flogged off the freehold to the Tchenguiz empire, in this case Proxima GR Properties, the managing agent being the same owners’ Estates and Management Limited.
“When I first saw the fees E and M were asking for I was shocked: after all, what service were they providing other than some very basic administration – a couple of entries in a spreadsheet and a couple of emails?” asked Hempson-Jones.
“When I looked online I realised I was not alone. Estates and Management, and companies like them appeared to be effectively taxing leaseholders for sub-letting their properties.”
The sums demanded were £108 to grant a license to sub-let the property and £85 for registration.
The LVT cut the fees to £40 plus VAT and declared the registration demand as “not payable”. The tribunal also made a section 20 ruling so that none of the landlord’s costs can be passed on to the leaseholders.
In addition, Proxima GR Properties was ordered to reimburse Hempson-Jones’ £50 tribunal fees.
The tribunal president barrister Robert Latham referred to 13 LVTs on this issue, where both landlords and leaseholders have lost, and a total of five rulings in the Land Tribunal.
In making his ruling, Latham said: “I am wholly unpersuaded by the Respondent’s (the landlord’s) assertion that it would be necessary for a trained administrator under the supervision of qualified legal staff to take around two hours.
“The list of tasks said to be involved looks to me to be a list of all the things that could conceivably be done in connection with the grant of consent rather than the things that would need to be done in a typical case or that were in fact done in the case under consideration.
“I agree with the applicant that a large managing agent such as E&M will have standardised these processes.”
“I was very glad about the ruling – which seems to be common sense,” said Hempson-Jones. “I just hope Estates and Management and companies like them are changing their policy on consent – and other unfair administrative charges – rather than responding only to those who expend the effort of taking them to a tribunal. But this remains to be seen!”
The LVT ruling can be read here: