Posted by David on January 23, 2008, 9:58 am

Following the meeting arranged by the directors of BWFL for the Charthouse leaseholders, I have had a few conversations with other leaseholders and we all share a common opinion. We are somewhat disappointed that there was such a “them and us” atmosphere at the meeting. The point of having BWFL as a company in which many lease holders are shareholders, is that Burrells Wharf is effectively run by and for the people who invest here. Instead, it felt very much like the directors’ only agenda at the meeting was to persuade us that the conclusions they had come to were the only options, despite being such bad value for the leaseholders they are expected to represent. The timing of the meeting was highly questionable. Many leaseholders only had several hours notice of the meeting. Although it was claimed by the directors that the date was set to “be the most appropriate to fit in”, no leaseholder at the meeting seemed to have been consulted about the immediate date. This left the view that the directors had arranged the meeting at short notice in order to reduce the likely attendance numbers. Given that work cannot start before July, there seemed to be no excuse for the short notice. Indeed the first point made by one of the leaseholders was that the meeting should be cancelled until proper notice could be sent. Despite all this, turnout was good and the directors should now understand the strength of feeling about this issue. Leaseholders remain to be convinced that the cost of repairs and the schedule of required work have been properly researched. The report from Cook & Associates has yet to be received and was not published at the meeting. There was no mention of a second opinion or any research into the re-engineering of the control panel. Elaine Higgins from R&R said that twice-yearly health and safety checks of the lifts had shown no problems, yet in an email to me Gareth Frith said of the necessity to fit new hoisting ropes; “The recommendation is clearly for safety reasons”. However, in the meeting he changed that to “because it is convenient to do at the same time”. There doesn’t appear to be any consistency in outlining what work is required for “phase 1”. Adding in extra work for “convenience” only delays the start of works because it takes longer for BWFL to raise the money for them. Leaseholders have lost trust in the directors’ ability to cost work following the plumbing checks of last year. Although there were assurances at the time that each check cost £50, the accounts and check statistics reveal that we actually paid in excess of £300 per hour for a plumber to just look at pipes and say if they were leaking. A large contract should yield a large discount, not a rate over four times the emergency call out rate. The directors’ should see the lift issue as an opportunity to regain trust, but by taking a single report and applying all of it’s points without further research or opinion is not going to provide the best value for the leaseholders or shareholders. We don’t believe that the issue of external financing has been properly researched. From experience I know that arranging finance can take a number of months, so spending a couple of weeks before Christmas asking about financing items that have yet to be specified really isn’t going to scratch the surface of possibilities. Can the directors assure us that every avenue is still being researched? We feel that the directors have taken the easy way out. Rather than have time-consuming negotiations with potential funders, the directors have decided that it would be better for the current Charthouse leaseholders to buy BWFL a new lift for their free use for the next 25 years. We do not think this is reasonable, hence the need for external finance. We also feel that the directors have not been entirely clear about the nature of the “special lift levy”. The name of this suggests it is a “one off”, but in fact the financial forecasts that the directors have presented include an identical levy next December, and another of significant magnitude the year after. This means the annual service charge for a 2 bed flat will exceed £5000pa. I suggest the following way forward is appropriate. Given that work cannot commence until July, Charthouse leaseholders should not pay the “special lift levy” until the end of April. Until then, the directors must ensure that every option of “economical repair” and external finance is researched. Money paid now is simply going to sit on account, costing leaseholders interest. My view is that, if at the end of April no other alternatives are present, I will pay the special lift levy although will interpret this as being forced to bail out BWFL after appalling failures in management. To get to a point where the lifts are 90% through their expected working lives with no reserves set aside for their replacement nor any plan to finance the same, means that the directors have failed to provide for long term stability in providing the service required of BWFL. This would be clear grounds for a vote of no confidence in the board and their resulting dismissal. DC

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