Park Charge Challenge

The background to our activities

We have worked on several fronts to challenge the Fixed Estate Charge ("Park Charge", or "FEC"), we provide a background to the journey here.  (We have redacted emails and phone numbers in the original documents)

In January 2024, we wrote a position paper which outlines the charge, available here: CMRA FEC position paper.

Initial Engagement

Our journey to challenge the FEC has continued over several years.  Work by earlier CMRA committees led to a review of the FEC by Jules Pipe, Deputy Mayor of London.  His report makes:

• A promise to publish the legal basis for the FEC .  It has take us a very long time to get this, and as you can see it is very "thin".

• An assertion that the charge is based on £1.26psf  for private dwellings and £0.62 psf for social, affordable and intermediate housing 2022 rates.  You will see later that the calculation by the London Legacy Development Corporation ("LLDC") shows that there is considerable inconsistency/inaccuracy in this statement. 

It turns out that there is no emprical correlation between the area of a property and the charge.  Expediency prevailed and rough alignment was used to calculate the initial amount in leases or transfer documents.  Having said that, we think it is reasonable to expect that roughly the same apartment should pay roughly the same charge.  Here is an example used for Phase 2 properties, we think it shows that roughly the same sized properties (by bedrooms ); this fails to ensure consistency across phases -- see "perverse outcomes" below.

Challenge to the Mayor of London

We held several meetings with the Deputy Mayor and the LLDC, the Deputy Mayor recommended that we write to the Mayor of London directly.   The CMRA letter to the Mayor of London was, after some considerable time, rejected in the Mayor of London's response.

Following rejection by the Mayor of London the CMRA approached a leading barrister to assess whether we have a case to bring a legal challenge under consumer law.  He thought that we had good arguments available, so we have decided to crowd fund sufficient cash to support our campaign once we had the LLDC legal opinion.  We now do and are starting this effort.  To bring a full challenge, we think that our resources will need to be above £100,000, so we are treading carefully and working initially to fund more limited advice.

Our interpretation of leases leads us to believe that most residents (except for Phase 1) are being over charged because of the way that the RPI calculation is being backdated to 2015 -- we discussed this at an open meeting in November 2024.   Following demands for the FEC by Rendall and Rittner ("R&R") we raised this with the LLDC and Chobham Manor LLP ("CMLLP").  The LLDC made an assertion that they were charging "correctly" and advised us to argue the case with CMLLP.

Challenge to CMLLP

The challenge to CMLLP in 2024 was eventually rejected in a letter from their solicitors.   

The next step was to return to the LLDC to ensure that demands made by the LLDC to CMLLP were inflated by RPI in the same way.   The charges are made using numbers in headleases.  It is worth noting that there are many headleases and typically cover a self contained block (e.g., Criterium House, Hyett Court, Park View Mansions, a set of maisonettes etc.).  If you have a copy of your headlease its scope will be shown in an annex.

Is the FEC a Service Charge?

This was challenged by a resident in Eastwick  at the First Tier tribunal.  The judgement was that the FEC is NOT a service charge.  Read the full judgement here. 

Perverse Outcomes

It was not clear to us that the LLDC was "backdating" RPI to 2015 in the same way as the LLP; we observed that this approach is creating perversions and undermining the principle of even treatment and the assertions made in the Deputy Mayor's report; this is as per our discussions of last year and the calculator that we created.  We have challenged the LLDC regarding these perverse outcomes. 

Part of the challenge above was the possibility that CMLLP was making a profit on the difference in the LLDC demand and our contributions.  This FOI response with reference to Criterium House shows that there is consistency between the LLDC and CMLLP; this means that the root cause of the "backdating" RPI is founded in the LLDC.  Our challenge of possible overcharging by the CMLLP  is therefore unfounded, but the other perverse outcomes remain and have worsened.

Where does that leave us?

To be clear, R&R are simply administering the FEC on behalf of CMLLP.  The CMLLP is applying the charge in the same way as the LLDC. There is little R&R or the CMLLP can do about the numbers.  That said, if you think their numbers are wrong then they would be your first point of challenge using the email ChobhamManorpm@rendallandrittner.co.uk.

The outcome of all of this is that the bodies administering  the charge have a consistent approach, at its root is the LLDC.  We have not heard back from the LLDC regarding the perversions created but expect a rejection.  The courses of action open to us are to:

• take legal and regulatory action for which we need to raise money, for initial advice and further work; and

• raise the heat on politicians through our MP and by raising questions in the London Assembly.

There remains an avenue of review open through Newham Council as they passed a resolution to review the charge and recommend an alternative but this is a slow process, is out of our control, and could likely result in a report retaining the status quo.