At Second Reading, I said that leaseholders should not be expected to become serial litigators in the same manner that the sub-postmasters had to in order to get some justice for themselves. We should seek to increase the rights of leaseholders, not strip them of existing rights and protections.
My amendment seeks to preserve the criminal sanctions against landlords withholding critical information about service charges. The Bill in its current form does away with these sanctions, which function as a backstop for the current scheme of service charge accountability. The Bill instead introduces a new scheme of service charge regulation, superior in many respects but lacking the critical ability for leaseholders to prosecute landlords who refuse to provide evidence that the services they have charged for were actually delivered.
Currently, under Section 25 of the Landlord and Tenant Act 1985, leaseholders have the right to pursue a private prosecution against their landlord if their request for service charge accounts or receipts has been refused or the landlord denies them the ability to inspect and copy the relevant documents. Without criminal sanctions, landlords will comply with the law only if it suits their financial interests to do so. A Bill capped at £5,000 of damages will not deter many and may mean that leaseholders now have to spend time and effort proving how much money they have lost.
I am not precious about this amendment, but I want to probe the Government on this and urge them to ensure that leaseholders will continue to have the right to bring private prosecutions against perpetually bad landlords under this legislation. I have mentioned Section 25 of the Landlord and Tenant Act 1985 a few times; it criminalises breaches of Sections 21, 22 and 23 of the same Act. These Sections 21, 22 and 23 are repealed by the present Bill, so my amendment would make a practical difference only until these repeals were brought into force.
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It has been more than 20 years since the Commonhold and Leasehold Reform Act 2002, and some of the sections about service charges have not yet been brought into force. It may yet be some time before the present Bill is fully in force; in the interim, my amendment would extend the backstop of criminal sanctions, protecting private leaseholders and, indeed, council leaseholders as well.
Some would argue against decriminalisation because that stick leaseholders have as a last resort to force bad landlords to give them information to defend themselves is very important. The Government should support leaseholders in having a strong place to start from.