The Times - UK (2022-05-24)

24 Tuesday May 24 2022 | the times

News

LEO MASON/ALAMY

‘Greedy’ Tory peer

charged excessive

leaseholder fees

A former treasurer of the Conservative

Party has been accused of greed after

leaseholders in a development he owns

were being charged 67 per cent com-

mission on their buildings insurance.

Over the past decade a company

owned by Lord Leigh of Hurley and his

family has received fees worth thou-

sands of pounds from residents of the

site in Harrow, north London.

One leaseholder complained to the

property tribunal, which has ruled that

the commission was “excessive” and has

capped the charges at a lower level.

Neil Solanki, 58, who brought the

case, says he feels angry that a senior

Tory has been benefiting from such

charges when the government claims to

be acting against leasehold malpractice.

He said: “These people are supposed

to be looking after the public’s interests,

not taking kickbacks. The government

has been looking into leasehold reform

and how the public has been mistreated

so it’s very upsetting that a prominent

politician is making money out of a situ-

ation where the unfortunate leasehold-

er has no control. It’s just greed.”

Leigh, who was treasurer of the Con-

servative Party in 2000-05, controls the

freehold of the site with his brother,

Trevor Leigh, through their company,

Dependable Investments Ltd. He also

jointly owns the managing agent of the

site, a company called Dennis Reed Ltd.

The Leighs say there was no malprac-

tice and that the commission was justi-

fied because there was no management

charge. Solanki said that most residents

had won the right to manage and pay a

service charge of £500 a year into their

own pot so no charge would be justified.

When the cost of his insurance

started increasing, Solanki asked for a

breakdown of the bill and said he was

shocked to find that residents were pay-

ing a commission amounting to 67 per

cent of the premium before tax. Just

over half of the commission was going to

the broker and the rest to Leigh’s man-

aging agent. The leases say residents

have to use the broker appointed by

Leigh’s managing agent.

Solanki took his case to a property tri-

bunal and provided quotes from three

alternative brokers that quoted com-

mission of 20 per cent of the premium.

A broker contacted by The Times who

looked at the case said a commission of

between 30 and 35 per cent would be

standard. However, the tribunal ruled

that the commission should be capped

at 49 per cent of the premium. It also

rejected Solanki’s claim to be reim-

bursed the excess commission from the

previous years because it had no juris-

diction over the insurance broker.

Leigh said that he was not involved in

the day-to-day running of the business

and pointed out that the court did not

award costs against it, which he believes

shows it acted reasonably. He also ar-

gues that there are lots of costs involved

for the managing agent when dealing

with the buildings insurance, including

ensuring the property is adequately in-

sured and that all bills are paid. He

pointed out that Solanki had withheld

his insurance premium for years, which

the company was forced to cover to

make sure the site was properly insured.

Solanki said he had offered to pay the

cost of the insurance but was withhold-

ing the disputed commission element.

Leigh pointed out that the commis-

sion amounted to only 40 per cent of the

total cost charged to Solanki. He said:

“The companies concerned acted at all

times within the terms and spirit of the

appropriate laws and regulations, and

indeed market practice.”

Andrew Ellson

Tu r f wa r s It was full speed ahead at the British Lawn Mower Racing Association championships in Billingshurst, West Sussex

Lord Leigh of

Hurley said the

“terms and spirit”

of the laws had

been adhered to

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