DRN-4964739 – Payment of disputed leasehold service charges added to the mortgage balance; complaint not upheld
What happened: A mortgage taken out in 2006 on a leasehold property. The borrower had been in a long-running dispute with a property management company about service charges. This service had already decided an earlier complaint about payments made up to August 2020. The Ombudsman dismissed the part of the new complaint covering that earlier period and decided the merits of one further payment. In January 2021 Rooftop received a county court judgment dated 25 November 2020 recording that the borrower owed the management company money. Rooftop wrote to her, told her she was in breach of her mortgage terms, and said that if it did not receive confirmation of an arrangement within ten days it might make the payment to protect its security. It made the payment on 16 February 2021 and added it to the mortgage account.
What the Ombudsman decided: Complaint not upheld. The earlier period was dismissed without consideration of the merits.
The published decision records that the complaint was not upheld.
What mattered to the Ombudsman
- That a county court judgment had already determined the borrower was in breach of the lease
- That the lender told the borrower about the judgment and gave her a chance to deal with it
- That no application had been made to set the judgment aside or to have a tribunal rule the charges unfair
- That the mortgage terms made the borrower liable for expenses incurred in remedying a breach
These are the factors this particular decision treated as important. Ombudsman decisions are not precedent and another case can turn out differently.
What this does not prove
It does not decide whether the service charges themselves were properly due. That question belongs to a tribunal or court, and was not determined here.
Source details
- Source type
- Financial Ombudsman Service decision
- Source
- Financial Ombudsman Service, final decision DRN-4964739 (Ombudsman: Rob Deadman)
- Date
- 11 September 2024
- Reference
- DRN-4964739
- Mortgage type
- Residential
- Jurisdiction
- United Kingdom
- Organisations
- Rooftop Mortgages Limited
- Source quality
- Official source
- Last checked
- 2 September 2026
- Added
- 2 September 2026
What happened
A mortgage taken out in 2006 on a leasehold property. The borrower had been in a long-running dispute with a property management company about service charges. This service had already decided an earlier complaint about payments made up to August 2020. The Ombudsman dismissed the part of the new complaint covering that earlier period and decided the merits of one further payment. In January 2021 Rooftop received a county court judgment dated 25 November 2020 recording that the borrower owed the management company money. Rooftop wrote to her, told her she was in breach of her mortgage terms, and said that if it did not receive confirmation of an arrangement within ten days it might make the payment to protect its security. It made the payment on 16 February 2021 and added it to the mortgage account.
What the borrower complained about
The borrower said Rooftop had made payments to a property management company without her authorisation and without sufficient due diligence, that the company was not entitled to demand the charges, and that Rooftop had paid more than was demanded.
What Rooftop said
Rooftop confirmed it had nothing further to add to the provisional decision.
What the Ombudsman decided
The Ombudsman recorded that the mortgage terms required compliance with the lease and made the borrower liable for expenses incurred by Rooftop in remedying a failure to comply, so the terms allowed payment where charges were in arrears and Rooftop believed its security was at risk. He found Rooftop genuinely believed its security was at risk because the matter had been to court, that Rooftop had told the borrower about the judgment and given her the chance to dispute it, and that he had seen no evidence she had applied to set the judgment aside or asked a tribunal to rule the charges unfair. He therefore found the payment and the addition to the account reasonable. He also dismissed, without considering the merits, the part of the complaint already decided in August 2020.
Outcome
- Complaint not upheld. The earlier period was dismissed without consideration of the merits.
Key extracts
“I think Rooftop genuinely believed its security was at risk here. The matter had been to court, and it was determined that Miss S was in breach of her lease”
Ombudsman, final decision DRN-4964739
“I've not seen any evidence that Miss S took further action to have the County Court Judgement set aside or ask a suitable tribunal to rule the charges unfair.”
Ombudsman, final decision DRN-4964739
Why this record may be relevant
This decision records what evidence the Ombudsman expected before a lender pays disputed third-party charges and adds them to a mortgage balance.
Source
Financial Ombudsman Service, final decision DRN-4964739 (Ombudsman: Rob Deadman)
View original sourceThe date shown is the date stated in the published decision by which the consumer was required to accept or reject it.
If you believe this record is inaccurate or incomplete, see corrections and right of reply.