Allegedly, elderly people living in retirement flats are being ripped off by a company controlled by Vincent Tchenguiz. The lease of these flats allows pets to be kept provided they do not cause a nuisance. This is a standard term in a lease in Britain. The agent, Estates and Management Ltd. (E&M), for the freeholder of the flats is exploiting this term of the lease to charge elderly people £80 for permission to keep a pet in their flats. This is not a requirement of the lease. Therefore, the freeholder is in breach of the lease. The problem is that elderly people are not au fait with the terms of the lease and they may become confused and in general elderly people tend to be more compliant to demands which look formal and legitimate. Therefore they tend to pay up at which point they’re being ripped off.
E&M is based offshore and is controlled by the tycoon Vincent Tchenguiz, although the company said that he was not involved in the day-to-day running of the business. In defence they say that where fees are allowed under leases they make those charges. However, it is alleged that the lease does not allow for a charge to be levied to keep a pet.
In addition to the pet charge, it is reported that in one case E&M tried to charge £5,000 for retrospective consent to construct a conservatory which had been built 25 years earlier by a previous owner of the flat. Once again, it is alleged that the lease makes no requirement for a leaseholder to pay the sums for consent to build a conservatory. Therefore the demand was in breach of contract on the face of it. E&M withdrew their demand. They have also been accused of overcharging for insurance.
Sheltered Housing Rentals Ltd, which owns retirement flats i.e. the leaseholds, has written to the Competition and Markets Authority complaining. They state that E&M have regularly ignored the terms of leases and that the occupants of the flats are elderly with an average age of 75. They want a quiet life but they are being hassled by this agent which wants to monetise their freehold interest and do so, allegedly, unethically knowing that the elderly rarely complain.
Another aspect of this case is that the leaseholder needs the freeholder’s consent when selling their flat. In this instance, the freeholder, via their agent, is allegedly withholding consent unreasonably unless the leaseholder pays an extortionate price for a buyout pack. They charge £295 when they normally cost £30 in most cases.
