Lambeth Council refunded £1.5m to ‘gagged’ leaseholders

A London council has been forcing residents into silence as a situation of them receiving cash owed to them for constructing work and providers they’d been overcharged for – in some circumstances by tens of 1000’s of kilos.

Lambeth Council was requested by the BBC what number of leaseholders it had requested to signal confidentiality clauses or non-disclosure agreements (NDAs) over a interval of 5 years. It stated 136 residents had entered into confidentiality agreements.

The Labour-run council has paid out practically £1.6m in constructing works refunds to these residents, at a median of greater than £11,500 per case. Leaseholders have advised the BBC how they have been refunded after being charged for shoddy work to their properties – and generally for work that by no means passed off in any respect.

They had to make a legally binding dedication not to inform anybody – together with their neighbours – about this.

Lambeth Council has about 9,400 leaseholders and is the freeholder of many flat blocks. It owns some properties outright as council properties.

When main works are wanted on a constructing, similar to window and roof repairs or exterior portray, the prices are divided up between the leaseholders and the council. Leaseholders are obliged to pay for his or her share of the work as a situation of their lease.

Speaking in regards to the council’s calls for for secrecy, Tracey Gregory, who has owned her residence in Lambeth for 23 years and whose invoice was ultimately lower by the authority, advised BBC London: “They don’t want us to tell our neighbours so they can’t apply for the same reductions.”

We asked the council why it legally prevents people from telling others about their refunds and it said this was “to avoid other leaseholders from using arguments made in separate and unrelated disputes. This enables the council to handle disputes on a case-by-case basis.”

Just earlier than Christmas in 2016, Tracey obtained a discover that work on her avenue was estimated to price her about £12,000. She understood that it wanted doing and paid the invoice.

The work was accomplished in 2017 however she didn’t obtain a remaining invoice till 2020 – which was for £21,000. She says others obtained remaining payments of between £15,000 and £65,000.

“We are just regular people with regular jobs; we don’t have thousands of pounds lying around… when you get the final bill you have to pay within 10 days,” she says.

The contractors had billed the council a complete of £2.6m for work to the properties on Tracey’s aspect of the road. She says they have been charged for loft insulation and the alternative of guttering and downpipes – work that was not finished.

A breakdown that has been seen by the BBC confirmed that £37,000 had been charged for changing gates.

“They said they had replaced all of the side gates – they hadn’t,” Tracey says.

After years of going forwards and backwards with Lambeth Council, she says she was supplied a refund of 36% however when the paperwork got here via it had an NDA connected. She refused to signal it – leaving her in a position to converse to the BBC with out worry of authorized reprisals.

“They said you have to sign it or we will retract our offer,” Tracey says.

In an announcement, the council justified using these clauses, stating: “Confidentiality is one of the cornerstone principles of mediation.”

It added that the settlements have been used to “resolve disputes and avoid the stress, time, costs, and incurrence of court resources” .

The BBC has seen an e mail from Lambeth Council to Tracey stating that she would have to pay the complete quantity as she had not signed the settlement deal. When she sought authorized recommendation, the council backed down.

It has been estimated by a volunteer group that the council was overcharged £720,000 by contractors on the challenge on her avenue.

Tracey says the apply of silencing leaseholders is totally unreasonable, including: “The only reason companies use NDAs is to hide something.”

She also believes the council has been trying to hide its poor contract management.

“The contractors are being paid for work they are not doing, so to protect their own finances [the council] pursues leaseholders to the nth degree when, actually, they should be pursuing the contractors,” she says.

Tracey says some residents of their 80s have been advised to “go to the bank and get a loan” to pay what they owed. She and others helped get the prices down for aged neighbours however she says arguing with the authority for 5 years has taken its toll.

“It takes a lot of strength to keep battling,” she says.

The council advised BBC London {that a} “confidentiality provision… is not the same as a standalone non-disclosure agreement”, but it surely added that it was altering the best way it approached getting into into these agreements.

It stated: “Having received bespoke external legal advice, the council has been advised to improve its processes and introduce best practice by asking parties to sign a confidentiality agreement before any potential negotiation.”

Another leaseholder, Emma – not her actual title – says she was advised by the council that her share of the price of the works to change the home windows and repaint the outside to her constructing may very well be practically £70,000.

She challenged the council, and was later to uncover it had contacted her mortgage adviser to say she was in breach of her lease.

Emma ultimately managed to get the invoice down to £26,000, which she paid, however she nonetheless believes she was overcharged and says the usual of the work finished was “terrible”.

She says the expertise was so “incredibly stressful” she offered her flat as a result of she needed to get away.

Publicly accessible information reveals the best refund given by Lambeth Council was £63,000. This means that if that particular person had not fought the invoice, they’d have been overcharged by tens of 1000’s of kilos.

In a freedom of data request, BBC London requested the council whether or not it knew what number of different leaseholders have been entitled to a payout.

It stated: “Settlement agreements are tailored to address the unique factual circumstances… it would not be appropriate or possible to extrapolate the outcome of a particular individual matter and apply it unilaterally across multiple properties or large-scale major works contracts.”

BBC London has spoken to three individuals who say they’d to signal an NDA to get a few of their a refund after being overcharged.

One of them, Richard – not his actual title – stated: “They do it to silence you so you can’t tell your neighbours.”

He was refunded a number of thousand kilos after an unbiased surveyor confirmed the price of restore work to the outside of his constructing had been inflated, and that he ought to solely have been charged 1 / 4 of what he was initially billed – which was greater than £10,000.

The BBC is just not revealing the precise determine to shield the id of Richard, who says: “At the very least, it’s gross negligence from the council.”

Antony Wynn from the Lambeth Homeowners’ Association, which has about 1,000 members, says he has heard many tales like Tracey’s, Emma’s and Richard’s.

“My telephone never stops ringing off the hook every day. There’s been horrific stories, and it just goes on and on.”

He says the council is being constantly overcharged by contractors and is passing on “massive bills” to its leaseholders and, regardless of repeatedly acknowledging the overcharging, is just not investigating the problem correctly.

The “total attitude and culture of the council is pushing back and not even beginning to want to address the problem”, he says.

Rather than investigating, officers threaten individuals with repossession if they don’t pay up, Antony says, including: “People end up as nervous wrecks; we have had people on our forum feeling suicidal.”

He says after lengthy disputes, some residents have received again up to £40,000. He describes the size of the overcharging as “mind-blowing” and believes the use of confidentiality agreements shows the council is “trying to hide their own mismanagement”.

Lambeth Council advised us: “We work hard to ensure that all the work is carried out as professionally and economically as possible. Contracts are tendered under established rules, and we have a team of professionals who ensure the comprehensive management and auditing of all the works, costs and progress.

“The council makes an estimate of the costs, and then charges leaseholders, who have the option of paying in installments. We are happy to discuss any issues with leaseholders and work with them to resolve any issues.”

Another leaseholder concerned within the struggle with the council is Alasdair Ross.

The software program engineering supervisor stated he was in shock when a invoice for £18,000 arrived at his flat in Brixton.

He advised BBC London how he skilled “a rush of cold sweat – how am I going to find that money?”

He says the letter requested he pay in full inside 30 days, or he might pay £300 a month for 5 years, on high of what he describes as his “obscene” service cost of £640 a month.

Alasdair says the work for a brand new central heating system in his block had been deliberate three years earlier than he moved in and he had not been notified of any works or upcoming payments within the 4 years he had been there.

Challenging the invoice took him about 18 months and, in that point, he says he was despatched threatening letters by the council telling him it might contact his mortgage supplier to say he was in breach of his lease – which the council did.

Alasdair, who didn’t have to enter right into a confidentiality settlement, says that after a protracted course of, the council conceded it had not consulted on the work appropriately and his invoice was capped at £250.

He says he requested council officers if they’d inform the opposite 36 leaseholders in regards to the “mistake” however was advised they’d not.

“I was just appalled,” he says. “For a public body to continue taking money when they know they’ve made a mistake, that just seems wrong.”

A Lambeth Council spokesperson stated: “As a landlord, the council is responsible for day-to-day repairs, maintenance and major works at our buildings, to ensure they are safe and secure for all our residents.

“Under the terms of their lease agreements, leaseholders, as well as the council, are required to pay a share of the costs of this work.”

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