Video: In working order - service charge recovery

Commercial property landlords have a duty to maintain, repair and keep in good working order the common parts of the premises. The cost of meeting this obligation is recovered by the landlord through the collection of service charge payments made by the buildings' occupiers.

The process is usually straightforward with each occupier paying a set apportionment – so the landlord doesn't make a loss, or a profit, on operating the service charge. The process becomes less straightforward where the landlord wishes to renew expensive items – such as lifts or air conditioning systems. Indeed where such expenditure is planned near to the end of occupiers' leases acrimonious disputes can arise as occupiers resist the proposed expenditure.

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