Billing Major Works Service Charges. Louise Turff Service Charge Construction Manager London Borough of Southwark
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1 Major Works Service Charges Louise Turff Service Charge Construction Manager London Borough of Southwark
2 LRX/6/2012 London Borough of Southwark v Dirk Andrea Woelke Invoices served for major works were not notifications in accordance with the lease Lease requires notifications of estimated and actual expenditure on an annual basis Leaseholder not liable for payment until correct notifications served
3 Time is not of the essence notifications can be re-served if inaccurate. Estimates are required Estimated notifications can be revised in year Revised notifications do not need to repeat all detail If revised notification for actual expenditure then it must include the total notified earlier with any account adjustments, and provide a date of when the information was previously served Alternative arrangements can be made with the agreement of the leaseholder
4 Southwark Lease Before the commencement of each year (except the year in which this lease is granted) the Landlord shall make a reasonable estimate of the amount which will be payable by the Tenant by way of Service Charge (as hereinafter defined) in that year and shall notify the Tenant of that estimate (2) The Tenant shall pay to the Landlord in advance on account of Service Charge the amount of such estimate by equal payments on 1st April 1st July 1st October and 1st January in each year (hereinafter referred to as `the payment days')
5 As soon as practicable after the end of each year the Landlord shall ascertain the Service Charge payable for that year and shall notify the Tenant of the amount thereof (2) Such notice shall contain or be accompanied by a summary of the costs incurred by the Landlord of the kinds referred to in paragraph 7 of this Schedule and state the balance (if any) due under paragraph 5 of this Schedule
6 Notification requires: The amount of service charge payable for the relevant year A summary of costs incurred (either contained within or accompanying the notification) This will be contained within the leaflet or letters... In the summary of costs an explanation of how the costs have been apportioned (either contained within or accompanying the notification) The balance due In the summary of costs an explanation of how the costs have been apportioned The date and relevant financial year should also be included
7 Revised billing process Notify annually of both capital and revenue expenditure before the start of the financial year If capital expenditure unknown at the time of invoicing then revised notifications to be sent when section 20 carried out Notifications show anticipated expenditure per financial year for major works with equivalent service charge Single major works invoice to allow for payment options
8 Leaseholders offered the option of paying in accordance with the lease or accepting more generous payment options and agreeing to notification outside of the lease Actual notifications dealt with on an exceptions basis Actual notifications based on costs incurred within each financial year based on payment certificates Single account adjustment Section 20b notices served annually in order to protect the service charge
9 Southwark lease requires notification to trigger payment not invoice Invoicing takes place for administrative purposes If the notification is correct the invoice is irrelevant to the lease The vast majority of leaseholders would prefer to be billed outside of the lease if that allows for more flexible payment options than required by the lease Subletting leaseholders may prefer to pay in accordance with the lease as they are not eligible for all of the alternative payment options Woelke decision must be viewed in relation to the individual lease
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