Return of prohibited service charges: LTA 1985 s. 20K
Non-participating tenant can apply to tribunal for return of variable service charge for non-litigation costs of a relevant claim if paid despite s.20J(1).
This section applies if, despite section 20J (1) , a non-participating tenant in relation to a relevant claim pays a prohibited amount to any person. For the purposes of this section, a “prohibited amount” is an amount that is— demanded as a variable service charge, and attributable to non-litigation costs incurred, or to be incurred, in connection with the claim. The appropriate tribunal may, on the application of the tenant, order the person to which the prohibited amount was paid to return all or any part of the amount to the tenant.
Text in force at .
Source: legislation.gov.uk — The National Archives (legislation.gov.uk), reproduced under licence Open Government Licence v3.0.
What it actually says
This section applies when a tenant who did not participate in a relevant claim (such as enfranchisement or lease extension) nevertheless pays a variable service charge that covers the non-litigation costs of that claim. The charge is prohibited by section 20J(1) because it is demanded from a non-participating tenant.
The tenant may apply to the appropriate tribunal for an order that the person who received the payment return all or part of the amount. The tribunal has discretion to order a full or partial return. The provision does not define what constitutes a 'relevant claim' or 'non-participating tenant'; those terms are defined elsewhere in the Act.
When it applies
- A tenant who opts out of a collective enfranchisement claim is billed for the solicitor's fees incurred in the claim.
- A tenant who does not join a lease extension application is charged a service charge for the surveyor's report used in the application.
- A tenant who is not a participant in a right to manage claim is demanded a variable service charge for the legal costs of the claim.
- A tenant receives a service charge demand for the costs of a valuation report prepared for a claim they did not participate in.
- A tenant who is a non-participating tenant in a claim for a new lease is charged for the landlord's costs of the claim.
What this section does not say
- This section does not cover litigation costs (such as court fees or solicitors' costs for court proceedings); those are covered by section 20C.
- It does not apply to a tenant who participated in the claim; only non-participating tenants.
- It does not apply to fixed service charges or to charges that are not variable.
- It does not cover service charges for works or repairs, only for non-litigation costs of a relevant claim.
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This page reproduces the text of LTA 1985 s. 20K in force at the date shown and explains it in general terms. It is not legal advice and takes no account of the circumstances of your case, which can change the answer completely. For a live dispute, for limitation periods, and before taking any step in court, consult a qualified lawyer in England and Wales.