Section 20 - Major works: has freeholder breached the S20 Rules?

redrabbit29

Hi Everyone,

Will keep this very brief and simple as I don't want to overwhelm you.

TIMELINE

August 2018 - we received a letter saying they were planning major works, estimated costs £15k - £20k. We had just sold and buoght our dream house but unfortunately the sale collapsed as a result of all this. :x

January 2019 - told they now expected it to be £12k - £15k

February 2019 - Asked by letter about whether we would support them installing a Juliette Balcony rather than a normal one to reduce costs. Everyone said yes as the balconies overlook a horrible road and are never used.

March 2019 - Stage 1 consultation which lasted 30 days

June 2019 - Letter from Freeholder stating the quotes they received are much higher than expected. They are now going to put the work out to tender, to get 6 quotes to try to get a better deal.

Note that in their email they state: "Since the initial meeting and subsequent emails and letters, we have been working behind the scenes to review the content of the planned work together with the pre-tender estimated costs we have received from our appointed consultant. These are much higher than were initially forecasted. As these costs are only a pre-tender estimate we have yet to go out to tender to receive any formal costs. Following the review of the scope and specification with the consultants, we have now instructed a formal tender to commence so more accurate costs can be obtained. We will obtain at least 6 tender submissions to ensure we get the best value for money."

.... I'm guessing that means this is not formally stage two and maybe then there is no legal requirement for them to share the quotes?


My Points

1. The main question is, they have not provided me or any of us the quotes that they received. I have asked about 4 times now and each time they have ignored the request and said they will give more detail later. Is this a breach of the S20 procedure as I thoguht they were supposed to share the quotes with residents?

2. I have evidence showing email after email ignored, the ones that aren't ignored just don't answer the questions. Since January I have asked the same questions repeatedly - about 7-8 times and they've not been answered. An example is:

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> what work are they actually getting quotes on, all I know so far is "balcony, guttering, cladding"... that is so vague, I wanted to know details of what it is they're planning

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> They were offering a 5 year interest free loan, but that works out at over £300 per month. They agreed this was "too aggressive" and would look into it. 8 months later and they've still not updated us.

3. I have repair records which show 29 repairs since 2010. The majority of these are things like clearing guttering (which many say was never completed). Some repairs are for broken bulbs. There's nothing significant. Our argument is that this large amount of work is required now as they have neglected the building.

4. The delays - August 2018 we were told about the major works. They said it would begin in April 2019.... then they said May 2019. It is now nearly August and they have still not even selected the building firm. I know there are stated cases about the delays. They have acknowledged the delays by saying they've had staff changes, people leaving and things like that.

..............

The freeholder is large organisation, with over 7000 homes owned in the town. There have been two recent reports in the news of them failing to delivery on other projects, including a £7m renovation of some flats, and also asbestos clearance. They have nearly £50m of assets according to their accounts.

Do you feel there is any evidence of a breach of S20 here - in reference to the quotes not being provided despite repeated requests?

... Also:

Is there anything of value in the service delivered, and the delays. Their general treatment of us and our neighbours is appalling and unacceptable.

Thanks everyone

da_rule

Why do you think they have to provide the quotes?

Section 22 of the Landlord & Tenant Act 1985 ('LTA') gives you the right to inspect accounts and documents once you have requested a summary of relevant costs under section 21. You obviously can't request this until the costs have actually been incurred. Even then, the landlord only has to make the documents available for you to inspect (i.e. you go to them) and provide reasonable facilities for you to copy them.

Under the Service Charges (Consultation Requirements) (England) Regulations 2003 ('the Regulations'), the landlord only has to provide an overview of two of quotes obtained when they issue the second consultation notice. They must make all of the quotes available for inspection, but again they can say that you have to go to them.

There are no set time limits within the LTA or the Regulations however, in the case of Jastrzembski v Westminster City Council [2013] UKUT 0284 (LC) the Upper Tribunal set out that the time from giving the first notice to carrying out the works should be measurable in "months rather than years". Obviously a landlord can get around this by just re-issuing the first notice and starting the process again.

In terms of 'reasonableness', there are arguments that a landlord failure which results in additional costs could render the service charge unreasonable (or at the least the part of the cost/cost increase attributable to the failure). It is quite a high bar evidentially to show that action (or inaction) is unreasonable. You can apply to the Tribunal either in relation to a charge that has been levied or a proposed charge that is yet to be levied. It may be your argument that the building has been neglected, but where is your evidence? The landlord could simply argue that doing small pieces of piecemeal work would work out more costly (constantly incurring contact costs and 'on costs' etc) and that they have a reasonable repair and maintenance plan for their estate.

In terms of their general treatment of you there isn't a great deal you can do unless you can pin them down to a specific clause in your leases (highly unlikely). As you point out, they have thousands of properties, so probably only reply to things that they are compelled to reply to.

If you think any of the works are unreasonable etc then you need to formally reply to their consultation notice, to the address they provide, within the prescribed time limit. Then they are compelled to provide a response.

da_rule

One issue I forgot to address: the scope of the works. The notice should be clear enough in regards to the works to be undertaken to enable you to understand the extent of the works and the reason they are needed.

If they, for example, say they want to "clad the exterior of the building", then this is probably good enough. The main reason for providing this information is to enable you to suggest someone from whom the landlord should try and obtain a quote and to make representations.