Admin costs

Key topics: Ground rent, poor service, administration costs

£190

Agent to accept £100 administration fee

Resolved by early resolution

The complainant said:

the managing agent sent several demands for ground rent before applying £190 administration charges which he never received
they then began their debt recovery procedure when no payment was received
there were postal issues, in both the area and the block, but on receiving the final demand, he paid the £525.20 ground rent, leaving the administration fee as a balance
this caused him stress and was unnecessary as the agent tried no other way of communicating with him

The agent's response was that:

after several reminders were sent and the ground rent remained unpaid, solicitors were instructed to recover the debt
the managing agent has already reduced their administration cost to £190.00

Ground rent demand, the original invoice, other demands, communication

The evidence showed:

the postal disruption was 4 months after the date of the agent’s first invoice to the complainant
all the letters had been sent to the correct address
the lease allowed the managing agent to claim all costs and expenses due to potential legal proceedings with the complainant
there was insufficient evidence to show that the letters had not been received
the £190 administration cost was added because the ground rent payment remained outstanding for some time

The decision found:

the complainant had broken the lease term to make all payments on time
the agent offered no clear breakdown of how the administration fee was calculated
the agent was entitled to reasonable costs for the extra work carried out
it was reasonable for the complainant to pay £100

agents should send invoices in writing, by letter or in a way that all parties have agreed
where an agent receives no reply, it is good practice to try contacting the relevant person using another method, which may help prevent this happening
any fee must be reasonable and supported by evidence showing how the cost has been calculated and maybe include a summary of the leaseholder's rights and responsibilities for any fees
the First-tier Tribunal (Property Chamber) has the authority to decide if an administration cost is reasonable but if the parties agree to use our free service and listen to our recommendations, we can facilitate a speedy and successful resolution
If a leaseholder wishes to be contacted by a different/alternative method, they should confirm this in writing to the agent
Any fee must be reasonable and supported by evidence showing how the cost has been calculated and a summary of the leaseholder’s rights and responsibilities for any fees
The First-tier Tribunal(Property Chamber) has the authority to decide if an administration cost is reasonable but if the parties agree to use our free service and listen to our recommendations, we can facilitate a speedy resolution

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