Liable for other residents' debts?

[whizzer]

Two out of 34 residents have not paid full management fee and they are owed £2000+ , can they add the debt to the management fee and expect the remainig residents to pay off the debt for them?

I dont want to pay off someone elses debt and this will also encourage others not to pay in future.

[sgclacy]

Two out of 34 residents have not paid full management fee and they are owed £2000+ , can they add the debt to the management fee and expect the remainig residents to pay off the debt for them?

I dont want to pay off someone elses debt and this will also encourage others not to pay in future.

A lease gives very strong powers of collection to the freeholder to be able to collect monies that have been correctly incurred and our reasonable. What you may find is that you may have to share in the legal costs of collection. The court may order that the lessee pays so much towards the legal costs but the shortfall in the legal costs will have to be passed through the service charges, unless the lessee is able to get a Section 20 C order precluding this.

The LVT or the courts will not normerly make such an order where the landlord is shown to have incurred the service charge costs reasonably.

There may well be commercial reasons why the management company has yet to collect the debt from these two lessees.

[whizzer]

Thanks for that, they don't say why they havent got the money from them but have just said that they have tried many avenues to get it.

legal costs i expect but not just sharing out the original debts.

I wont be paying it for them though for sure, i'll try to find out some more information

Cheers

[jeffrey]

Lessor should bill the defaulting lessees' mortgagees (lenders). They have an interest in protecting continued validity of leases.

[whizzer]

Thank you Jeffrey ive sent a letter asking why they arent going back to the original debtors for the money, i'll post any reply
Cheers

[whizzer]

Had letter this am from management co saying that the residents should go round and see the people who havent paid in the hope they are going to pay up. What a joke, they want us to act as unpaid debt collectors to hassle them into paying up!!

Wha should the management co be doing really? they say they have written and spoken to the debtors but the are refusing to pay.

I'm very angry now

[jeffrey]

Had letter this am from management co saying that the residents should go round and see the people who havent paid in the hope they are going to pay up. What a joke, they want us to act as unpaid debt collectors to hassle them into paying up!!

Wha should the management co be doing really? they say they have written and spoken to the debtors but the are refusing to pay.

I'm very angry now

As between:
a. lessor (freehold reversioner) and lessee (= you), lessor is responsible; but
b. lessor and mgt. co., mgt. co. is at least contractually responsible.

Is this mgt. co:
a. same thing as lessor; or
b. just a contractor appointed by lessor?

Do lessees collectively own either or both of them?

[whizzer]

The management company sold the freehold to another company last year but still collect the service charge and organise maintainance etc

Its a separate company and is not run by the residents here.

We pay ground rent to the company which owns the freehold.

Does that help?

Thanks

[jeffrey]

So freehold reversioner (F) receives rent and engaged mgt. co. (M).
Hence, F is obliged to observe and perform covenants as lessor- see lease. It should therefore be legally responsible for collecting the arrears, even if it sub-contracts the work to its agent M.

[whizzer]

cheers jeffrey you're a star!