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S20 consultation: it doesn’t need to be daunting

11 December 2017 • Melanie Dirom

Being up to speed on the consultation process and legal requirements will help mitigate against financial and reputational risks further down the road.

A pitfall of being a leasehold lawyer is my inability to be able to walk past a residential block of flats wrapped in scaffolding without wondering – indeed hoping – that the landlord has conducted their Section 20 consultation correctly! I am sure I am not alone…

Barely a week will pass when I am not asked to advise on a thorny consultation issue, or when clients will query if they can recover the cost of major work which has either been completed , or which are being planned.

A frightening prospect?

It seems to me that for some landlords the concept of charging leaseholders for works which they have undertaken is a frightening prospect, potentially fraught with conflict, and something which they are not prepared to do. This is a mind-set which landlords need to change.

As a reminder, a landlord can recover up to £250 from a leaseholder for “qualifying works” without having to consult. If the landlord intends to recover more than £250, then the procedure under Section 20 Landlord and Tenant Act 1985 must be followed. This is a statutory regime of serving:

a) A Notice of Intention then;
b) A Notice of Estimates, and followed by;
c) Notice of Award of Contract

It’s crucial that this regime is followed to the letter. If done incorrectly – and then challenged – landlords could be restricted to charging no more than £250, irrespective of what the true cost to them has been. A scary thought when expensive works may have been carried out or planned.

Crucial timetable

But in practice, section 20 consultation does not have to be daunting, and those who are responsible for major works simply need to be up to speed with the requirements and the time frames that come with it - and follow them religiously.

For example, at least 30 days’ notice is needed between the service of the Notice of Intention and the Notice of Estimates, and then a further 30 days to consider the responses on the estimates. So, if major works are being planned the time limits for consultation need to be factored in - consultation cannot be completed in a few days.

In cases of emergency works, where the landlord does not have time to consult because of the nature of the work that’s needed, landlords can apply to the Residential Property Tribunal for permission to dispense with consultation, or possibly shorten the time for consultation. Legal advice should always be taken in such situations as such application do come with a health warning, but there is no reason for landlords not to consult and then seek to recover the full costs of the works that are undertaken.

Follow the process, and get advice early

So, my key piece of advice to landlords is that it’s absolutely vital you get up to speed on the process of consultation, and if you think you need legal advice seek it early. If done correctly landlords should be able to satisfactorily recover the costs of major works.

In my view an empowered landlord is more likely to embark on a programme of major works and keep those properties in good standard, which will benefit of not only the landlord, but the leaseholder and the occupiers of those properties too.

Find out more

Croftons is hosting a Leasehold seminar in spring 2018 when consultation and other topics will be looked at in more detail. Exact details are TBC, but check our website in the New Year, or please do drop me an email if you would like to be kept informed about the event, or would like any further advice on this issue.

 


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