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Hi Gavin Can you clarify that Ross & Liddell will meet all future costs of enforcing the

common charges and not charge irrecoverable debts or associated legal costs between other owners. Thanks Richard Chairman of Panmurefields and Cairnfields Residents Committee ============================================================================ Hi Richard, Thank you for your email. The most common question was regarding irrecoverable debts following the recent court action, which the defender has since chosen to publicise. The Deed of Conditions provides the Managing Agent with the necessary authority to spread irrecoverable debts between other Owners. However on this occasion Ross & Liddell has decided to absorb all debts associated with this court case and so Owners will not be charged with a share of common charges, which the Owner in question has refused to pay or a share of the legal costs incurred to date. What I advised Owners at the most recent meeting stands Ross & Liddell has little alternative but to write off the arrears (unpaid common charges) due to be paid by Mr Ross. The vote on Tuesday 20th August confirms our authority to act so any future similar case against a defaulting Owner would be strong (depending on the defence) not like the recent judgement at Glasgow Sheriff Court. After taking further legal advice our position is that it would be dangerous to risk further court proceeding for any common charges prior to the date of the vote. There is a risk that the Sheriff would take the same view on the basis that the vote from Owners was not confirmed until 20th August 2013 so our case for debt recovery prior to that date would not be as strong. The cost to raise such formal debt recovery action would be far greater than the level of unpaid common charges. For this reason, and as promised at the meeting on Tuesday 20th August Ross & Liddell will absorb any arrears with Mr Ross (now decided until 20th August 2013) and also the full cost of the recent court case (likely in excess of 1,000 court expenses). Mr Ross will be expected to pay his fair share of all charges after 20th August 2013. He has received the same letter from this office. Ross & Liddell may not be as willing to absorb debts like this in the future if a similar situation was to arise. It is important that Owners remember that the Managing Agent is employed to administer common repairs on behalf of Owners. It is the Owners who are liable to pay for common repairs (inc. any debts) not the Managing Agent. However it is extremely unlikely that a debt spread scenario will ever arise. I will try to explain this further.

Normally, where an Owner fails to pay an invoice, and fails to respond to reminders, and letters from Sheriff Officers and the level of arrears merits our office considering formal debt recovery action (notice of potential liability, small claims action, etc) other Owners would not be aware of this or have any need to be concerned about the cost of the debt recovery action. Because of data protection our office can only disclose personal information regarding debts if a court rules in our favour and decree is granted. I will always be in a position to advise the Committee what the level of debt at the Development is, how many debtors there are etc. without having to disclose any personal information. Small claims action is normally instructed for the principal sum due and the expenses of the court case so the defender would normally pay for the court action (level of expenses will depend on how far the action is taken post decree diligence, etc). The potential debt spread clause in the Deed of Conditions might be evoked where a defender is unable to pay even after formal court proceeding are taken and the Managing Agent is effectively required to underwrite that share of common repairs going forward. At some Developments the level of debt makes common management services extremely difficult and the Managing Agent is required to give notice and quit. Unless the other Owners agree to underwrite the debts and unpaid shares going forward. Thankfully such action is uncommon, especially as Ross & Liddell has such a strong Credit Control department. This would be particularly unusual at a ground maintenance only Development like Newton Road with a relatively low level of common expenditure. The Managing Agent would most probably opt to secure any bad debt against an individual property (Notice of Potential Liability) or against the Owner (Inhibition) and wait for the debt to be paid as part of a future house sale. This might take years in some cases. Sometimes debts are spread to allow common management services to continue but the Managing Agent will continue to pursue the debtor and a credit is later given back to Owners. Ultimately you have no cause for concern debt recovery is unfortunately a necessary part of the service that we offer to make the day to day management of Developments like Newton Road viable. To conclude, Owners will never be charged for court expenses in the first instance where debt recovery action is required although thats not to say that a debt spread scenario will never be required in the future where an Owner is unable to pay common charges. I hope this makes sense please advise otherwise. Kind regards,

Gavin.
Ross & Liddell