What is a sweeper clause?
The term sweeper clause or sweeping up clause refers to a distinct provision within leases.
Often incorporated by landlords to recover costs, a sweeping up clause in a lease provides an expansive and flexible power to impose charges for services, beyond those explicitly mentioned in the lease.
Predominantly present in service charge provisions, such clauses serve to cover an array of expenditures that might be necessary for proper maintenance safety amenity.
These clauses are a means by which landlords might ensure the costs associated with the management and upkeep of the property are recovered. At their heart lies the capacity to incur expenditure for any works installations, acts, matters, or services not specifically outlined in the lease, but deemed necessary by the landlord in their reasonable discretion.
Where in the lease can I find a sweeper clause?
To check whether you're bound by such a clause within your lease, start by looking at the end of the service charge provisions.
A sweeping up right may be described across several service charge clauses, potentially in different places throughout the document. So do read it all.
They are formulated to be broad in scope, extending their coverage to expenditures incurred for works not anticipated at the time of drafting but deemed necessary or desirable for proper maintenance safety amenity of the property.
Look for terms like 'proper maintenance safety', 'additional services', or 'other professional persons'.
What is the contra proferentem rule and how does it apply to sweeper clauses?
Contra proferentem may be an archaic Latin term, yet its a cornerstone principle of contract interpretation in the UK.
Simply put, this rule suggests that any ambiguity in a contract is resolved against the party who drafted it.
In relation to sweeper clauses, it plays a vital role in mitigating any unbridled authority that these broad provisions might bestow upon landlords.
Should you find a sweeping up clause in your lease that is vague or capable of multiple interpretations, the contra proferentem rule may tilt the balance in your favour.
For instance, if the clause allows for 'expenditure incurred in the reasonable discretion of the landlord', it must be applied in a manner consistent with the overall purpose of the lease, failing which the courts or tribunals may interpret such terms in the tenant's favour.
Because these clauses require interpretation, lease disputes involving sweeper clauses often necessitate obtaining professional advice.
However, while this expertise can indeed provide valuable insight, remember, engaging such professional persons may not always be necessary.
Many leaseholders successfully contest service charges on their own, without the need for professional representation. The choice to seek assistance rests ultimately with you, and your comfort and familiarity with the legal landscape.
What if you disagree with a service charge recovered via a sweeper clause?
If you find yourself in a situation where you disagree with service charges that are being recovered through a sweeper clause in your lease, you may be able to overturn it.
Read about how to resolve problems.
Understand the terms of your lease
To effectively dispute service charges, it is essential to thoroughly review and understand the terms of your lease, specifically the clauses relating to service charges, expenditure, and the sweeper clause itself.
Pay close attention to the wording and provisions related to the recovery of costs, the landlord's discretion, and any limits or requirements outlined in the lease.
This understanding will help you assess whether the charges are fair in accordance with the lease and whether there are any grounds for dispute, such as not having been consulted on a qualifying long term agreement.
You may need to seek advice from a solicitor or other qualified professional who specialises in leasehold property management.
While you may be able to challenge a sweeper clause yourself, taking advice from a professional who has experience can help reduce the risk, save time, and potentially save costs in the long run. They can provide you with a clear understanding of your rights, obligations, and the legal options available, including ones you might not have considered, such as exercising your Right To Manage or seeking an acquisition order.
Gather evidence and documentation
Gather records of all relevant correspondence, invoices, and receipts related to the disputed charges.
If there are any specific works, installations, acts, or matters that the landlord claims fall under the sweeper clause, request detailed breakdowns and explanations of the costs incurred.
This evidence will be valuable when presenting your case and demonstrating any unreasonable or excessive charges.
You may be able to have a management audit carried out, or an evaluation by a surveyor.
Engage in negotiation or mediation
Before escalating the dispute to a formal legal proceeding, explore negotiation or mediation as a means of resolving the issue.
Engage in open and constructive communication with your landlord or managing agents, expressing your concerns with how they recover costs and providing evidence to support your position.
Mediation can be a useful alternative - it allows both parties to work with a neutral third party to find a mutually agreeable resolution.
Resolving a dispute realting to sweeping up clauses through negotiation or mediation can be more cost-effective and less time-consuming and stressful than going to court.
Consider the First-tier Tribunal (Property Chamber)
If informal negotiations or mediation do not lead to a satisfactory resolution, consider escalating the dispute to the First-tier Tribunal (Property Chamber). This is a type of court that has jurisdiction over various leasehold disputes, including challenges to service charges.
Before doing so, do seek legal advice to understand the costs and potential outcomes involved in the tribunal process.
The tribunal will consider the terms of the lease, the reasonableness of the charges, and any other relevant evidence before making a decision.
Obtain professional reports or expert witnesses
Obtaining professional reports or expert witnesses may be necessary to support your case before the tribunal. These reports can provide independent assessments and opinions on the reasonableness of the charges in question.
Experts can testify and provide their professional expertise to strengthen your argument.
However, weigh the potential costs and benefits of obtaining such reports or witnesses, as they can significantly impact the overall expenses of the dispute resolution process.
Dell v 89 Holland Park (Management)
In the case of Dell v 89 Holland Park (Management), the leaseholder, Mr. Dell, disputed the reasonableness of expenses incurred by the landlord, 89 Holland Park (Management) Limited.
The charges in question in these circumstances were being recovered through a sweeping up clause in the lease.
Mr. Dell claimed that the charges were excessive and not incurred in accordance with the general wording of the lease provisions.
The Upper Tribunal concluded that while the sweeper clause provided the landlord with flexibility in recovering costs for works and services not explicitly mentioned in the lease, it did not give the landlord unlimited discretion.
The tribunal emphasised that the landlord must exercise discretion and ensure that the charges are reasonable and in line with the purpose and intent of the lease provisions.
As a result, the tribunal reduced the service charges payable by Mr. Dell.