Leaseholders win landmark decision after footing the bill for 24-hour concierge and gym they couldn't use

A group of leaseholders have won a landmark court decision against a housing association after paying thousands of pounds in service charges for amenities they did not have access to.For years, leaseholders living in Block V1 of the Viridian Apartments development on Battersea Park Road in London were charged thousands of pounds for a 24-hour concierge situated in a separate private block.They were also charged for a private gym and maintenance of a courtyard, neither of which they had access to. The Block V1 apartments in question were designated as affordable housing and held under shared ownership leases, while apartments in the other blocks were privately owned or let. The housing association, Notting Hill Genesis, held the headlease for Block V1 having entered into a 155-year lease agreement with the freeholder and developer Barratt Homes in 2007.The problem at the heart of the case was that the headlease required the housing association to pay service charges calculated by reference to all eight blocks of Viridian Apartments, including costs incurred on services that its own sub-lessees were not allowed to use including the garden and the concierge. Landmark case: The Viridian Apartments development on Battersea Park Road Notting Hill Genesis sought to pass those service charges on to the leaseholders, and said that their sub-leases should be 'construed, or varied,' so as to enable it to do so. It argued that the residents of Block V1 benefited from a well-kept estate and should therefore be liable for the costs.However, the leaseholders of Block V1 argued they shouldn't be on the hook for services which they could neither access nor enjoy.These costs included garden maintenance, a 24-hour concierge service, pest control, communal electricity, cleaning of areas elsewhere on the site that residents could not access, and insurance for the wider development.Residents were reportedly shocked, having purchased flats in the social housing block specifically to avoid bearing the costs associated with the private luxury apartments that make up the rest of the development.Shared ownership is a Government-backed scheme that allows people to buy as little as a 10 per share in a property with rent being due on the remaining share.Shared ownership homes typically come with full liability for service charges associated with the building or development they are located within.In the court hearing, Judge Elizabeth Cooke ruled that the leaseholders in this case should not be charged for services they were not able to use and that were outside the scope of their leases.She said: '[Notting Hill Genesis'] argument that the respondents [leaseholders] derive a benefit from the fact that the garden etc is kept in a good condition for other people to use, and so should pay something towards such facilities, is deeply unattractive. '[Its] concession that the respondents could challenge the reasonableness of the expenditure does not mend matters.'I agree that it is nice to have one's neighbours’ gardens well-maintained; but that does not mean one has to pay for that pleasure, and in my judgment that is far too indirect a benefit. 'The same can be said of one’s neighbours’ concierge service, or of other benefits to one’s neighbours’ property.'The judge also ruled that the main problem was not the residents' leases but in the separate headlease that Notting Hill Genesis signed with the freeholder and the estate management company in 2007.Under the terms of the headlease Notting Hill Genesis agreed to pay a proportion of the costs relating to the whole development, (not just block V1), including repair and maintenance and management.It had therefore agreed to pay a share of the cost of services which it had not been granted the right to use, in particular the garden and the concierge service enjoyed by other blocks within the development.It essentially responded by passing on these costs to the leaseholders living within Block V1.The Judge added: 'Why it entered into a lease in those terms is unknown, but its attempt to visit the consequences of that decision on its sub-lessees cannot succeed.'The court also ruled that leaseholders in Block V1 would not be liable to pay Notting Hill Genesis's legal fees.Notting Hill Genesis has been contacted for comment. 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