Leasehold Retirement Property concerns
When you purchase a leasehold retirement property you usually review your requirements strategically to ensure you purchase the right property.
If you are buying private retirement housing, you will normally select a scheme that provides the services you need, or wish to receive, at an affordable cost. The lease will set out the services you are entitled to and explain how the landlord or managing agent will recover the costs through a service charge. Once you have bought your property it is a matter of some concern if those services deteriorate or the costs increase unreasonably. Most leaseholders will be satisfied with the management of their retirement development but occasionally problems do occur:
Problems which you might experience can include:
- escalating costs as management fees and service charges increase each year;
- reductions in service provision, eg withdrawal of the resident manager service;
- lack of opportunity for residents to influence the management of the scheme;
- the diminishing value of your investment in the flat as the lease expires.
If problems occur, your first recourse should be to speak to your manager or landlord, either directly or through your residents' association, if you have one. If this does not, for any reason, resolve the problem, there are a number of other courses open to you, including the more drastic sanction of recourse to your statutory rights under the various Landlord and Tenant and Leasehold Reform Acts.
The law relating to leasehold is complex and subject to change. The latest amendment to the law, the Commonhold and Leasehold Reform Act 2002 is being commenced in stages and certain requirements referred to in this leaflet may not yet be in force at the time of reading. If in doubt, seek further advice.
The following courses of action should all be available to you; they are not set out in any order of preference and it will be for you to consider which is more appropriate to the circumstances. In almost all but the most urgent cases it will be sensible to attempt to find a solution by some means of alternative dispute resolution, before embarking on a more formal route, where costs could be incurred. Most of the remedies set out in the first part of this guide are fully accessible to the individual leaseholder, or residents' association, without the need for professional advice.
1. Individual or joint action
You may decide that you wish to contact your managers to give them an opportunity to resolve any difficulties you have experienced. However, it is generally recognised that management problems on a retirement housing scheme can be more effectively dealt with through a formally recognised residents' association. This is a residents' association which has been granted recognition by the landlord which requires more than half of the properties to be represented. In cases where this recognition is not forthcoming the association can apply to a Rent Assessment Panel for external recognition, but this will requireat least 60% of properties to be represented. There are several legislative remedies where leaseholders have greater rights working collectively than individually. Even without a recognised association, it may prove effective to have the support of your neighbours in any dispute with the landlord or managing agent.
2. Using the landlord's or manager's complaints procedure
You may wish to use your manager's complaints procedure, which should be made available to all leaseholders and should form part of any leaseholder's handbook. This procedure should state who the leaseholder should complain to and any further steps if the complaint is not resolved at the first stage. There are often three or four stages of a complaint procedure, and the managers should give the complainant an opportunity for a meeting with a senior officer if the complaint reaches the final stage of the procedure. If all stages of the complaint procedure fail to resolve the matter, some leaseholders will have recourse to the Independent Housing Ombudsman.
3. Using the ARHM procedures
Many managers of retirement schemes are members of the Association of the Retirement Housing Managers (ARHM), the aim of which is to promote high standards of practice and ethics on the management of retirement housing.
The Association has produced its own code of practice, approved by Government as representing best practice in the retirement housing industry. Managers who are members of the ARHM promise to manage not only according to lessees' legal rights, but also according to the code of practice.
For example, managers will provide:
- right to have the receipts and invoices supporting the annual accounts available on your estate for inspection;
- right to an annual meeting to consult on changes to service charges;
- right to a comprehensive leaseholder's handbook;
- right to set a response time for replying to correspondence or organising repairs.
As part of the code of practice and ARHM's rules, lessees are also given some additional remedies:
- all ARHM members must have procedures that allow lessees to make complaints and access to an answer at a senior level;
- most ARHM members offer lessees the right to use an ombudsman service to resolve disputes;
- lessees may ask ARHM to investigate alleged breaches of the code of practice by its members.
All ARHM members agree to make a copy of the code of practice available for reference at each retirement housing estate they manage. Ask to see it.
The ARHM supports the work of AIMS and LEASE and strongly recommends lessees use their services in order to gain free advice and information on their rights and remedies.
4. Contacting AIMS and dispute resolution
If you have a problem or enquiry regarding retirement housing you can call the AIMS advice line for impartial advice, information and dispute resolution assistance.
AIMS may be able to help by using negotiation or mediation to assist leaseholders and landlords to understand what the problem is, how it came to occur, what issues may be involved and to suggest ways to resolve it. AIMS provides impartial advice and dispute resolution assistance in a way that helps leaseholders, landlords and managers to resolve problems amicably. This can prove particularly helpful where the people involved have an ongoing relationship as with leaseholders and their landlords.
When a matter is referred, AIMS will, if appropriate, offer mediation to try to resolve the problem. Mediation is a solution-focused process involving an independent third party - a mediator. The mediator works with the parties, both separately and together, to help explore the issues and decide how the problems between them are to be resolved. Mediation is a voluntary, confidential process that uses a common sense and practical approach to resolving disputes, with the people involved working together to find their way to a sensible solution.
As mediators are neutral and, therefore, not responsible for taking sides, making judgments or giving guidance, mediation is different from processes like advocacy, counselling, arbitration, and representation. The mediator is responsible solely for developing interaction, and building consensus, between the parties. It is the parties involved who decide the terms of any agreement made between them. By working out the solution together, the agreement reached is more likely to work and to last.
Although mediation is voluntary, it is advisable to consider mediation or other forms of alternative dispute resolution (ADR), before referring a dispute to Court or LVT. In 1999, the legal system in England and Wales was reformed by the introduction of the Civil Procedure Rules. These rules, introduced as a result of recommendations made by Lord Woolf, place a new emphasis on the settlement of cases before they go to court, with a recommendation for the parties to have considered ADR. If one side unreasonably refuses to try mediation, or some other form of dispute resolution, before going to court, they risk not having their costs awarded and possibly even having to pay the other side's costs, even if their case is successful. In addition, complaints procedures are increasingly including mediation or some other form of ADR as an option, often as a first step towards resolving complaints.
5. Referral to the Independent Housing Ombudsman
Where the landlord is a Housing Association, the leaseholders will automatically have access to the Ombudsman; some private landlords are also members of the scheme and will be able to advise you if this is so. The Ombudsman will not usually deal with complaints unless you have first used the complaints procedure of your landlord.
The Ombudsman has a duty to investigate all complaints made to him and a number of courses of action are available to him to resolve the problem. Initially he may be able to resolve the matter through informal contact with the member landlord but, in more serious cases, he will carry out a formal enquiry. This is a very thorough examination, using the Ombudsman's own staff to investigate all relevant aspects of the complaint; a formal enquiry may include an interview with the person complaining. At the end of an enquiry, the Ombudsman will write to both the complainant and the landlord, explaining what he has found, what his decision is and what, if anything should be done about it. He is able to recommend to the landlord that he make an apology or pays compensation, carries out repairs or changes his management procedures.
A formal enquiry is a serious business and, in appropriate cases, the Ombudsman is able to arrange mediation or arbitration to resolve the issue.
6. Statutory rights and remedies
In addition to these less formal actions, all leaseholders have substantial rights under the legislation to require information, to challenge service charges or other management arrangements, up to the right to take over the management themselves or to acquire the freehold of the building.
Almost all of these rights will require the assistance of a professional, a solicitor, a surveyor, an accountant or a managing agent, and costs are likely to be incurred. Clearly advice should be sought from LEASE or AIMS or your residents' association at an early stage prior to any commitment to professional fees, none of which will be recoverable from the landlord.
The information contained in this article has been taken from the publication by ARHM, the Association of Retirement Housing Managers.
Go back to previous page
DISCLAIMER
Any external products and services listed do not necessarily carry the endorsement of retirement-flat-living or imply a recommendation. retirement-flat-living.co.uk does not recommend any of the advertisers and cannot be held responsible for any work undertaken by or purchased from any advertiser on this site.
Whilst retirement-flat-living makes every effort to ensure that the articles included in the web site are accurate at the time of publication it is inevitable that, as time goes by and circumstances change, the articles may contain out of date information. Readers are strongly urged to check the content of these articles before taking any action that could have legal or financial consequences. retirement-flat-living shall not be liable for any loss, damage or inconvenience arising from inaccuracies.