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Firm’s right to fix property service charges upheld

By Joseph Onyekwere
09 May 2022   |   2:46 am
A Lagos High Court, Ikeja has held that a property management company, CMB Building Maintenance and Investment Company Limited, had a right to fix service and reticulation charges

Federal High Court, Lagos

A Lagos High Court, Ikeja has held that a property management company, CMB Building Maintenance and Investment Company Limited, had a right to fix service and reticulation charges for homeowners in Pearl Garden Estate situated at Sangotedo Village in Eti-Osa Local Council of the state.

Justice Mufutau Olokoba made the declaration while delivering judgment in a suit filed by some of the homeowners against CMB (property and the estate management agents) and Oyetubo Jokotade Estate Resource Limited (previous landowners).

Four homeowners in the estate, Francis Adesuyi, Felix Obiakor, Martin Ajayi-Obe and Peter Afenotan filed the suit on behalf of themselves and others within the Pearl Garden Estate.

The plaintiffs had, among other things, prayed the court to declare the arbitrary reticulation and service charges by the estate management illegal.

But in his judgment, Justice Olokoba upheld the right of the estate management to fix both charges, saying having agreed to pay for the charges of maintaining the estate, the homeowners could not resile from the agreement.

The court, however, held that there must be an agreement between the estate management company and homeowners over the actual amount to be paid for the services.

The judge observed: “No doubt, the defendant is entitled to collect service charge and the residents/homeowners are bound to pay the service charge as stated in the Sale and Management Agreement.”

“The way and manner the defendant, in collusion with the security men and men of the police force, went about recovering payment for services rendered by the defendant, must be discouraged.

“Payment for an agreed service rendered is necessary to sustain the procurement of the services. The court is of the firm view that the residents/homeowners must pay the service charge as contained in the contract agreement. The rate of the service charge should be a subject of agreement between parties.

“Worthy of note is the fact that none of the plaintiffs had paid the service charge, not even the N12,500, which was suggested by the homeowners. Also, no material evidence was tendered in court to show that any of the claimants paid the reticulation fee.”

He said for members of the Pearl Garden Estate to have entered into an agreement to pay charges for maintaining the estate, the homeowners/residents could not renege on payment of services being provided within the estate.

The court also stressed that the service providers cannot unilaterally impose charges not captured in the agreement, urging parties to resolve the issues amicably.

The judge, therefore, refused to grant the N100 million damages requested by the homeowners for the alleged infringement on their rights during the enforcement of payment of the charges.