The Supreme Court handed down its decision in the Arnold v Britton case on 10th June 2015 which concerned the service charge provisions in the leases of 25 holiday chalets on a site near Swansea.
The leaseholders challenged the wording of the provision which prescribes annual increases in service charges at a fixed rate which would ultimately result in service charges in excess of £1,000,000.00 (one million pounds) per annum at the end of the term.
The court ruled against the appellants (leaseholders) by a 4-1 majority stating that the service charge provisions did not make the leases defective! The decision therefore makes the chalets unsaleable and perhaps unmortgageable!
A full copy of the decision can be found at:
https://www.supremecourt.uk/cases/uksc-2013-0193.html
The court ruled against the appellants (leaseholders) by a 4-1 majority stating that the service charge provisions did not make the leases defective! The decision therefore makes the chalets unsaleable and perhaps unmortgageable!
We understand the landlord may be in discussions with the tenants in respect of re-negotiating the service charge provisions on more favourable terms.
For more information on this case or service charges in general, please contact Yashmin Mistry on ymistry@jpclaw.co.uk Please also follow us on Twitter @JPC_Law and @yashminmistry for further updates on this or other leasehold related cases
