Q&As

Can the leaseholder of a residential block with long leases who has incurred legal fees demand these as administration charges from tenants or can they only be demanded as part of and when service charge is due?

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Produced in partnership with Chris Bryden of 4 King’s Bench Walk
Published on LexisPSL on 22/02/2018

The following Property Disputes Q&A produced in partnership with Chris Bryden of 4 King’s Bench Walk provides comprehensive and up to date legal information covering:

  • Can the leaseholder of a residential block with long leases who has incurred legal fees demand these as administration charges from tenants or can they only be demanded as part of and when service charge is due?

A residential lease, if properly drafted, will usually contain provisions enabling the landlord to recover from the tenant legal costs incurred in enforcing any covenant contained in the lease, such as a failure to pay service charges, or arising out of an action for forfeiture. The question of how these costs are recoverable is likely to depend upon a number of factors.

Legal costs can, depending on the wording of the lease, amount to a ‘cost of management’, thus falling within the definition of a service charge in section 18(1) of the Landlord and Tenant Act 1985: Iperion Investments v Broadwalk House Residents. However, if these costs form part of the service charge, they are subject to the requirement for reasonableness and are therefore open to challenge at the First-tier Property Tribunal. It is necessary to consider the construction of the clause in the lease: Arnold v Britton, as th

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