Decision details

Executive considered a report of the Portfolio Holder – Housing which recommended the refunding of management fees charged by the Council in relation to the service charges applied to leasehold properties over a seven year period.

Moved by Councillor Sandra Peake and seconded by Councillor Liz Smyth

RESOLVED - That on the basis that the management fees do not meet the statutory tests of ‘reasonableness’ in the 1985 Act:

(1)       existing tenants be refunded any management fees paid to the Council from when they took on their lease where their account is up to date in all other respects;

(2)       where an account is in arrears, existing tenants should be refunded any management fees previously paid to the Council from when they took on their lease but any refund should be first used to clear any arrears with the tenant receiving any remaining balance of the refund;

(3)       an advertisement is placed on the Council’s website inviting former tenants to apply for a refund of any management fees paid to the Council during their tenancy providing a proof of ID, verification of bank account details and proof of payment to prevent fraud; subject to

(4)       where an old account has not been settled in full, previous tenants should be refunded any management fees previously paid to the Council during their tenancy but any refund should be first used to clear any outstanding debts with the tenant receiving any remaining balance of the refund.

REASON FOR DECISION:

As the Council could not convincingly demonstrate that the management fees accrued over seven years were charges reasonably incurred by the tenants or that the service they paid was provided to a reasonable standard, it was agreed that the fees be refunded.

OTHER OPTIONS CONSIDERED:

A ‘do nothing’ option was rejected because this would not have resolved the existing complaints or satisfactorily addressed the issues raised in this report.

A ‘do less’ option was rejected because a time limit on certain claims against the Council in the 1985 Act could not be reasonably applied to the matters at hand.

(Paragraph 3)

(Director of Development)