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Seeking advice: Limited company bank account for s.42 service charges

Seeking advice: Limited company bank account...

Hello all

I hold a long lease on a flat and one share in the Residents Management Co. so it is lessee-owned. The flats and Estate are held in Trust for the Transferors. The RMC has not complied with the Lease and has not supplied certified annual s.42 accounts since 2008 as written in the Lease and statute.  LVT Judgment 2010 that wording of lease is that no service charge payable unless and until accounts produced in accordance with the Lease.  In 2014 the RMC made me bankrupt for non-payment of service charge for years 2007, 2008, 2009 (years involved in LVT Judgment). No pre-action letter, no account details, and the amounts claimed not backed up by certified accounts.  The RMC declared itself as Dormant but has not provided any accounts to shareholders since 2012.   My assets are frozen by the Trustees in Bankruptcy KPMG, with a charge on my flat. If there is no bank account, I cannot know to whom this sum of money (£40K) is being paid to?  There is a law firm involved who recently lost a case claiming that when the Superior Lease is transferred to the RMC they did not have to observe the lease contract.  The Judge referred to the Supreme Court ruling that a contract is as understood by the parties and s.42 is a contractual provision, and any costs outside s.42 is voluntary.   I am wondering whether the RMC is hiding insolvency.  Service charge is now being paid into the company account of a MA and there appears to be overseas bank transfer arrangement with the same account number and it seems service charge is going off shore. This suggests attempt by Directors to get assets out of the hands of creditors.  I am happy to pay outstanding s.42 service charge, but without certified accounts, it seems I have to pay amounts which I do not owe. Does anyone have any idea what I can do?

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26th Feb 2016 16:06

What you can do is take legal advice.

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27th Feb 2016 11:06

I agree take legal advice. There is a possible oppression of Minority shareholder case to be put to the courts. You could possibly apply to the Court to have the company wound up.

I repeat the first point take legal advice,which no doubt you took when presented with a Bankruptcy Petition- - or did you??

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19th Mar 2016 11:53

take legal advice when presented with Petition

Hi thanks all

No unfortunately I was not able to because the following week I was diagnosed with cancer - and from then on hospital visits for tests and then major surgery etc.  The Hearing went ahead even though consultants letter presented to the court. The court did not inform me that it was not accepting these letters and I did not know until afterwards that the Hearing had gone ahead in which I was not represented.

All my Submissions to the Court refer to the LVT Determination that no service charge payable unless and until the RMC complies with the Lease, and all ignored by the presiding Judge, even when I tried to appeal. I am therefore declared bankrupt even though the LVT Determination still not complied with.

Since then I learned of the Supreme Court Judgment (2015) UKSC 36 Appeal from (2013) EWCA Civ 902 Arnold (Respondent) v Britton and Others (Appellant) the Court must identify the meaning of the words by reference to "what a reasonable person.. with all the background knowledge available to the parties ...would have understood them to be using the language in the context to mean...", that is the Lease contract must be complied with.

The Petitioner sent a set of accounts to a chartered accountant for certification but do not appear to have been given  my Lease.  The name of the RMC is not referred to, only the location address of the flats nor any reference to the covenants and the LVT Determination. This Accountant reports that there appears to be £58,000 service charge arrears "which may not be recoverable".  The Account number which the Accountant refers to as a Service Charge account is not recognised, and is not the account number used by the MA for its current account and using the same account number for overseas bank transfer.

 

 

 

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