Many commercial leases (particularly leases of part of a building) require the landlord to provide certain services, and for the tenants to pay the landlord for those services through a property service charge. This will often include the costs of maintenance of common areas, refuse collection, security and utilities.
The lease will normally set out the services that the landlord must provide, the cost that each tenant is required to pay, and the procedure that the landlord must follow to budget and report costs and to claim the service charge from the tenants.
Every property service charge is tailored to the building to which it relates. Different leases will require different services and will set out different procedures which the landlord must follow. This can make applying service charges difficult. Disagreements will often arise about how the service charge should be applied.
Some common service charge disputes include:
A landlord who doesn’t comply with the service charge provisions in the lease may find itself unable to recover the cost of services it has provided, or compelled to provide services which it has failed to provide. A tenant who doesn't comply with service charge provisions may not receive necessary services, or may risk court action or forfeiture of its lease for non-payment of service charge costs.
We regularly advise landlords and tenants on commercial service charge disputes.
For landlords, we can:
For tenants, we can:
The team's real strength lies in the fact that everyone takes a very commercial approach towards litigation, realising that sometimes a good settlement may be worth more to a client than a judgment from a court.