Freehold recovery

Service Charges payable in respect of freehold properties can be fraught with difficulties.

Unlike service charges on leasehold properties, which are usually automatically binding on every assignee of the Lease, positive covenants on freehold properties are somewhat complicated. Often developers will try to overcome such difficulties by creating a type of rentcharge over the Property known as an estate rentcharge.

Freehold owners frequently confuse estate rentcharges with service charges payable by leaseholders. Although estate rentcharges and service charges share superficial similarities they are, in fact, very different. Importantly the legislation in respect of reasonableness does not apply to estate rentcharges and (save for rare exceptions) the First Tier Tribunal does not have jurisdiction over them.

We have a detailed knowledge of this area of law including the Rentcharge Act 1977 and the associated caselaw and are able to determine, quickly, the most appropriate way of recovering sums due.

To discuss this area further or to instruct us to recover unpaid service charges / rentcharges please contact Jonathan.Wragg@PDCLaw.co.uk.