Sudden £9k section 20 notice - can I do anything?

pannonica

I've just received a Section 20 notice today from the management company for my flat which details proposed works to my building and the amount they want to charge. The flat is a converted house, it's a 1900 era end terrace house converted into two flats, and the freeholder is the local authority.

The amount they're asking for seems incredibly high for what they're actually proposing to do. From the letter, it seems like most of the works consist of painting and minor non-structural repairs to outside parts of the building. From the itemised list of proposed works the most expensive by far is scaffolding (£5200) - the next most expensive item is painting the walls at £145. This in itself seems a bit ridiculous. 

There are then a number of extra percentages added for extra fees for various vague and arbitrary-sounding reasons (see screenshot below), bringing the total cost of the works to £17700 (my share being £8850).

It seems completely crazy to charge such a massive amount for what seem like very minor works. I know that they’re required to send me a section 20 notice and give me the opportunity to respond, but can I actually do anything to challenge it?

From my point of view none of the works they’re proposing are essential and where painting works or small external repairs are required I’d much rather pay for these to be done myself when they’re needed without involving the management company.

It also seems like a clear conflict of interest that the person who came out to do a survey and decide what needs to be done is apparently working for the same company that’s going to get the contract for the work.

Do I have any grounds to challenge this?

Should I look into the right to manage, or would that be too late? This is the third section 20 notice I’ve had in the last year and a half since I bought the flat (the other two seemed similarly unnecessary but were less expensive at least).

Jonboy_1984

What does the lease say in regards to freeholders external decoration obligations?

Our previous property had an explicit “externals to be redecorated every 4 years, communal internals every 8 years”, others I have seen effectively say as and when required to keep it in good order.


Housing associations and local authorities in general are known for high and regular section 20’s that attempt to gold plate their obligations.

Is the final notice or have they been through the stage were you can nominate contractors for them to seek quotes from. Note they don’t have to choose the cheapest but you can then challenge their reasons at a tribunal?

The other advice is generally to pay under protest, and then dispute at tribunal rather than simply withhold money to avoid any forfeiture of the lease or the freeholder getting it added to any mortgage.

Michael_Bear

Sorry I can't provide any advice on S20 my only comment is about extra 35% on everything. It's probably all legal but it's alot of money for very little (as what it's paying for should be covered in contractors costs, what's all this workbthat requires thousands of pounds!).

Good luck!

theartfullodger

What can you do?  Pay it - I suggest adding "under protest" in writing, then dispute in basis of lease and law.

eddddy

If you want to challenge a s20 works, you really have to do it during the process - when you're invited to make observations.

If you wait until after the consultation has finished, or even worse. after the work is finished, before you challenge it - a tribunal will probably say you've treated the council unfairly. Because if you'd challenged them in advance, they could have reviewed their plan and potentially made changes.

I guess one option is for you to hire a building surveyor, to give a professional opinion on whether the work is necessary, and/or whether the price is reasonable.

I guess a building surveyors report might cost cost you about £500 - but it might (or might not) help reduce the works bill by more than that.




And/or you have the option to nominate a different contractor to quote for the work.

Perhaps you know a small builder who would do the whole job really well for £5k. But they'd probably need to pass the council's vetting policy. That probably includes things like:

• A  minimum level of professional indemnity insurance
• Formal qualifications in building/painting
• Formal qualifications in health and safety
• A written health and safety policy
• Evidence of doing similar jobs previously
• References from previous clients
• Financial references from their bank
• etc, etc

And they'd probably need to spend hours writing-up long detailed quotes and answering long questionnaires for the council (which will be wasted time, if they don't get the job).

Small (cheaper) businesses can't / won't do that kind of stuff. It's often only the super-professional (often super-expensive) businesses who can / will do that.

pannonica said:

Should I look into the right to manage, or would that be too late? 

So there are 2 flats - are they both leasehold? If so, both leaseholders will need to agree on the Right to Manage.

I would hope that if you started the RTM process, and then said to the council "please don't proceed with the s20 while we set up the RTM" - they would be reasonable about it.

How do you get on with the other leaseholder? If you had to work together on stuff like getting the building painted an repaired - would that work well?  Are you likely to agree on stuff? Is the other leaseholder likely to pay-up without argument when necessary? etc.

pannonica

Jonboy_1984 said:

What does the lease say in regards to freeholders external decoration obligations?

Our previous property had an explicit “externals to be redecorated every 4 years, communal internals every 8 years”, others I have seen effectively say as and when required to keep it in good order.


Housing associations and local authorities in general are known for high and regular section 20’s that attempt to gold plate their obligations.

Is the final notice or have they been through the stage were you can nominate contractors for them to seek quotes from. Note they don’t have to choose the cheapest but you can then challenge their reasons at a tribunal?

The other advice is generally to pay under protest, and then dispute at tribunal rather than simply withhold money to avoid any forfeiture of the lease or the freeholder getting it added to any mortgage.

The screenshots below show what the lease says about exterior decoration. If the lease says they have the right to charge me for exterior painting then I guess there's nothing I can do about that but surely it has to be a more or less reasonable amount? The amount they're asking for seems completely insane.

This is not a final notice, the only communication I've had from them before this was them asking to book someone to come and do a survey. The letter says that I have 30 days (until the 22nd of June) to 'make observations'.

pannonica

theartfullodger said:

What can you do?  Pay it - I suggest adding "under protest" in writing, then dispute in basis of lease and law.

Right, but at this stage they're not actually asking for the money, they're just notifying me of the projected cost and giving me the chance to 'make observations'.

I guess this is the consultation that they're legally required to give. It doesn't actually mention the word 'consultation' but this seems like what it is. It says any response has to be given within 30 days, so it seems like I should have some kind of right to question this if I reply now, in theory. I think maybe I need to get some proper legal advice on what I should actually say.

pannonica

eddddy said:

If you want to challenge a s20 works, you really have to do it during the process - when you're invited to make observations.

If you wait until after the consultation has finished, or even worse. after the work is finished, before you challenge it - a tribunal will probably say you've treated the council unfairly. Because if you'd challenged them in advance, they could have reviewed their plan and potentially made changes.

I guess one option is for you to hire a building surveyor, to give a professional opinion on whether the work is necessary, and/or whether the price is reasonable.

I guess a building surveyors report might cost cost you about £500 - but it might (or might not) help reduce the works bill by more than that.




And/or you have the option to nominate a different contractor to quote for the work.

Perhaps you know a small builder who would do the whole job really well for £5k. But they'd probably need to pass the council's vetting policy. That probably includes things like:

• A  minimum level of professional indemnity insurance
• Formal qualifications in building/painting
• Formal qualifications in health and safety
• A written health and safety policy
• Evidence of doing similar jobs previously
• References from previous clients
• Financial references from their bank
• etc, etc

And they'd probably need to spend hours writing-up long detailed quotes and answering long questionnaires for the council (which will be wasted time, if they don't get the job).

Small (cheaper) businesses can't / won't do that kind of stuff. It's often only the super-professional (often super-expensive) businesses who can / will do that.

pannonica said:

Should I look into the right to manage, or would that be too late? 

So there are 2 flats - are they both leasehold? If so, both leaseholders will need to agree on the Right to Manage.

I would hope that if you started the RTM process, and then said to the council "please don't proceed with the s20 while we set up the RTM" - they would be reasonable about it.

How do you get on with the other leaseholder? If you had to work together on stuff like getting the building painted an repaired - would that work well?  Are you likely to agree on stuff? Is the other leaseholder likely to pay-up without argument when necessary? etc.

This letter is the first notice I've had (apart from them booking in a survey and sending someone to do it) so we're still in the consultation process - the letter says that I have 30 days to 'make observations'.

What worries me is that if I have to take legal advice, book in someone else to do a survey, get someone to do quotes etc., this doesn't seem like loads of time to get all that done.

But it seems like if they're supposed to give me any kind of reasonable chance to suggest alternative contractors etc. they should at least give a clear breakdown of what work they deem necessary. I haven't received any actual report from their survey.

I did have a home survey done before I bought the flat (just over a year ago) - I guess this report wouldn't be any use for the purpose of contesting this?

Regarding right to manage, the other flat is owned by the local authority, so my understanding is that there isn't a lease. Does this mean right to manage isn't an option for me? I'd be interested in looking into buying the freehold as well (as a more long term thing I guess, not to deal with this issue now) but I'm not sure if this is doable either in this situation.

Jonboy_1984

I would start by taking a look here: https://www.lease-advice.org/faq/what-is-the-section-20-consultation-process-for-major-works/ as they are starting the consultation process and read through all the sections.

As an observation you could ask if the work can be completed via a cherry picker rather than fixed scaffolding which may be less expensive (depends on access and road layout around the site).

eddddy

pannonica said:

What worries me is that if I have to take legal advice, book in someone else to do a survey, get someone to do quotes etc., this doesn't seem like loads of time to get all that done.

The law says that costs must be 'reasonable'.

You can interpret 'reasonable' as meaning...

• It's 'reasonable' to do all the work - i.e. the repairs and painting are needed. And, for example,  it's 'reasonable' to scaffold the whole building (e.g. as opposed to using scaffold tower, cherry picker, etc)

• The price being charged for the work is 'reasonable' - e.g. They're not paying a firm £5k for scaffolding, when other firms would charge £2k.

That's the kind of thing an suitable building surveyor should be able to tell you.


You don't have to get quotes. You just have to give the council the name of the company.  The council will then ask the company for quotes. (But you should probably ask the companies if they'd be interested in quoting and doing the job - before putting their name forward.)

pannonica said:

Regarding right to manage, the other flat is owned by the local authority, so my understanding is that there isn't a lease. Does this mean right to manage isn't an option for me? I'd be interested in looking into buying the freehold as well (as a more long term thing I guess, not to deal with this issue now) but I'm not sure if this is doable either in this situation.

I think you're scuppered in that case. You won't have the legal Right to Manage, or the legal right to buy the freehold.

In theory, the council could 'voluntarily' sell you the freehold - put I doubt they'd do that while they have a tenant in the other flat.

eddddy

pannonica said:

This is the third section 20 notice I’ve had in the last year and a half since I bought the flat (the other two seemed similarly unnecessary but were less expensive at least).

Will all the service charges amount to more than £15k if you're in London, or £10k if you're outside London?

There are some rules for social landlords...

There is a potential cap on the costs for major works if the mandatory reduction for service charges applies.

The Mandatory reduction directions for social landlords (councils or housing associations) came into force in England on 12 August 2014.

The Directions limit the amount of service charges recoverable from leaseholders of social landlords, who occupy their flat or house as their only or principal home.

Within any 5-year period, the maximum a landlord can recover is limited to £15,000 within London and £10,000 outside London.

Link: https://www.lease-advice.org/faq/my-landlord-is-the-local-council-or-a-housing-association-they-are-planning-to-carry-out-a-lot-of-work-on-my-estate-leading-to-high-service-charge-bills-is-there-any-limit-on-how-much-i-can-be-asked/

See also: https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/342737/140811_Mandatory_signed.pdf

I'm not really familiar with those rules, so I don't know if there are exemptions etc. Maybe start by asking the council if those rules apply to you.