Leaseholders and Roof Repair by Management Company

jaytee28

Hi, I am a leaseholder in a block of sixty flats that are all leasehold.   My flat is on the top floor and the roof of the building is in chronic condition and needs urgent repair by the management company.  The first leaks/water ingress were in one part of the building,  but since then all the other flats on the top floor including mine have suffered the same issues.  

At the stage when the first set of leaks were known the management company obtained an estimate for the repairs but things did not advance beyond that stage. After the other more recent flats damage was reported, an estimate was obtained for repairing the entire roof.   Now, the nub of the issue is that the first estimate would be covered by the "reserve fund" that the management company has built-up from our annual service charge, however the second estimate would mean each leaseholder stumping up approximately £300 each.   The management company is organizing a vote of all leaseholders, but obviously the first option will be chosen as it's no financial pain to people.  

The management company have been unable to give me any timescale on when my part of the roof would be done in that scenario,  we are assuming the reserve fund would have to build up again first.   If you have stuck with long message, thank you for your patience, what I am asking is whether I have any case at all to demand that the management company treats all of us equally and is obliged to do the full work (I appreciate that that would go down like a lead balloon with a lot of my co-leaseholders!).

Thanks.

m0bov

You need to find out why the initial quote was not acted upon. It sounds like this has caused you more money so it's negligence. Might be worth speaking to your buildings insurance. The management company were well aware of the issue but failed to act even though they had funds.

eddddy

jaytee28 said:

The management company is organizing a vote of all leaseholders...

That's absolutely not how you manage repairs to a building.

In simple terms,

• The roof is leaking into your flat

• Your lease almost certainly says that the freeholder/management company is responsible for repairing the roof (to stop the leak into your flat)

You don't have a vote on whether to fix the leak into your flat. People can't override your rights under the lease, by having a vote.

Is your management company a 'proper' professional management company?

Or is it a management company run by 'amateurs' - possibly flat owners - who are kind-of 'playing' at managing the building?


In your position, I think my response to the management company would be something like...

"The vote is very interesting, but for the moment you need to ignore the vote, and concentrate on repairing the roof to prevent water leaking into my flat.

If you don't repair the roof in a reasonable timescale, you will be in breach of my lease. If my flat is damaged as a result of you breaching the lease, I will expect you to cover the costs of repairing that damage." 

jaytee28

eddddy said:

jaytee28 said:

The management company is organizing a vote of all leaseholders...

That's absolutely not how you manage repairs to a building.

In simple terms,

• The roof is leaking into your flat

• Your lease almost certainly says that the freeholder/management company is responsible for repairing the roof (to stop the leak into your flat)

You don't have a vote on whether to fix the leak into your flat. People can't override your rights under the lease, by having a vote.

Is your management company a 'proper' professional management company?

Or is it a management company run by 'amateurs' - possibly flat owners - who are kind-of 'playing' at managing the building?


In your position, I think my response to the management company would be something like...

"The vote is very interesting, but for the moment you need to ignore the vote, and concentrate on repairing the roof to prevent water leaking into my flat.

If you don't repair the roof in a reasonable timescale, you will be in breach of my lease. If my flat is damaged as a result of you breaching the lease, I will expect you to cover the costs of repairing that damage." 

Thank you for your reply and advice.   The management company is part of a large group that manages several "retirement living" blocks across England and Wales.

I think I may contact a solicitor to go through what options I have. 

gm0

Solicitor who has experience in this stuff. Is a good idea.  Highstreet random not so much. 

Contents insurance legal protection *may* be a route for some basics.  But as you may well have a claim there.  You may decide to save that one.

The managing agent may not be the owning freeholder and lessor (who may be in breach).  Your lease will tell all. But they are acting for them to day to day management.   You will need to target your action for lease breach appropriately

With an external corporate freeholder and a managing agent i.e. not share of freehold - legal threats and actions starting invites legal responses.  This does not as a generalisation speed things up.  You may want to gather more information and work out the full situation as best you can before clamming them up.  Softly softly, emergency repair needs etc.  Then bang bang.  Once you go in formally - informal discussion and information sharing likely stops.  Legal team responses only.  Their concerns become avoiding negligence, cost management, correct cost recovery process (for leases (avoiding a load of tribunal actions) enough activity progressing claims and project sourcing to defend negligence/lease breach claims - but certainly not minimum overall cost to you as leaseholders or rapidity of speed to fix.  All correspondence goes via their legal team.

Retirement living blocks seldom do Right To Manage and leaseholder collective purchase of freehold. It happens by exception.  For fairly obvious reasons (age of residents and nobody volunteering to do it, and capital availablility limited from retiree lessess. So the voting is an odditiy which needs explaining.

Check records more carefully and talk to neighbour leaseholders of longer standing.  Actual voting would normally imply an RTM arrangement or a share of freehold arrangement where it would be "normal" for the owners of said company.  To vote to instruct the directors of it (volunteers from among themselves) who deliver collective will to any hired by them agent. In rtm/sof - Owners are owners because they are leaseholders (lessees) and bought freehold into the ltd.  Or have exercised RTM without acquiring freehold (yet).

With a corporate agent and an external freehold (no RTM) - it could be a form of communication and establishing resident association "preference" and managing the "splash" of a possible out of warranty yet early and unexpected cash call on lessees for an early asset replacement beyond the sinking fund. 

Normally the sinking fund would save up for new lifts and roof repair of a building with very long leases - via a levy annually (part of service charge a levy), or by harvesting a payment (xn years occupancy) at lease assignment (resale).  While this latter is widely hated.  It reduces the retiree cashflow demands while living there.  And was a choice made at buying the lease.  Site cashflow may not be even, or sufficient of course if it relies on lease reassignment events.  Lease reassignment charges are usually on the face of the lease as a clause.  The annual sinking levy (if there is one) will be visible somewhere in annual service charge budgets.  And Section 20 will remain an option available for a cash call demand from freeholder to lessee in most cases.    It would be odd for a retirement flats company to have overly constrained their options.  So disputing *alternative* means proposed to manage cashflow can lead back to a Section 20 for the bill /n leases landing on the mat.

RA voting can be window dressing.  People do react even more poorly if they feel they were never engaged or consulted.  Absent RTM or Share of Freehold. The freeholder (via their agent) in discharge of their responsibilities - can do replacements and repairs and notify and recharge (as per Section 20) and other lease clauses based on the terms of the lease.  You have lessee rights re tribunal challenge - process followed - and reasonableness of amounts quoted but no actual "control" of what happens i.e. of solution choice.  Some ability to challenge a non-like for like replacement.  They can't wildly upgrade the building at your cost.  And they can't rope a lorry tarpaulin over it and claim to be done with a complete solution.  Of course it may be in your interests that the roof technology at replacement is different if the "old one" has proved so inadequate.  It depends.  Again be careful what you push for.

From the perspective of a freeholder with a few tens of thousands freehold land value (which leaseholders can buy out at par) with long leases demised on it.  They are not going to provide hundreds of thousands of capital to pay for a new roof.  They are going to repair or replace a roof and recharge to lessees under one of the routes permitted under the long 999 year leases.  It being a valid expectation that the roof would need repair or replacement in such a long lease period.   And "wear and tear" failure vs insured events like fire or storms (buildings insurance) mean that some repair and replace is "normally" funded that way.  Early replacement is something which is a problem for all involved.
If a roof fails absent a fire/storm insured event.  And is out of warranty.  Then the site sinking fund gathered from lessess against replacement costs is commonly the next port of call.  And a cash call (Section 20) after that (if exhausted).  Not knowing that possibility could come up doesn't make it go away.

This also happens in scenarios where it is decided that it is too late / too uncertain to spend tens of thousands or more in legal costs sueing an insurance company (of a former roofer/prime contractor developer) who will defend the claim - perhaps successfully.  Adding more cost. More delay.  Still no roof.  Sometimes even if it is suspected that poor workmanship was a "factor" in short life. Or was it design (architect deliverables).  Or materials (supplier).
It may be unrecoverable at a reasonable cost in practice once insurance company legal teams are on the case.

The exception would be with a newish building where a latent defect at construction / warranty claim against developer is feasible. The wear and tear failure is ridiculously early.  The defects are extreme and obvious.  The prime contractor or their insurers could be pursued to raise the funds to pay for the rework (And they can pursue their subs and any insurers but that's a them problem).  The freeholder in that scenario should  be doing that for their own and lessee benefit.

With an older building significantly out of any warranty - this is a fools errand.   As costs climb towards the cost of the works. Lawyers win.  Nobody else.

Back in the roof - there will be a decision chain (with or without a developer + insurance/surveyor dispute in it) from "OMG it ALL needs replacing" to "with what - same again or something else", "who pays", getting quotes and picking a contractor.  Following lessee notificaiton processes.  Communication. Meetings.  Section 20. etc.  Then finally contracting, scaffold. Works.

Whether it's external freeholder or share of freehold collective.  There is a natural grief cycle to go on.  Shock. Denial. Rage. Acceptance.  Nobody can easily sell at "normal" expected prices until this is sorted out once known in the local market.

Realistically emergency repairs *cannot* be allowed to screw up any surveying and latent defect attribution by destroying the disputed structure element (if developer insurers are being targeted for larger funding of replacement with a claim and their defense surveyors have yet to come).  If this is going on this usually means buckets until a certain point in the process is reached.  As doing emergency repairs with some random new player - cut out and patch and glue etc. Can shift the insurance liability dial.  And may become be a negligent act by the agent - just in a different direction.  Progressing the claim (at the speed of surveyors and lawyers) may in fact be the "not negligent path" for the agent progressing it for a freehold owning company with no operations of its own. 

This is why you need a better grasp of the timeline state of the process any third party claim (developer, insurer or not) and so on.  You can take a view on how long that will take.  And press for emergency repairs for the worst affected units pro-tem - where it doesn't kick over the long term solution.

Pressure including well drafted lease breach legal notices may need to be applied.  Loss adjusters and lawyers without a leaky ceiling are not hurrying

You also need to be careful to act in ways that don't invalidate your own contents insurance.  That insurer isn't going to be keen to pay for decor fixes repeatedly with an unfixed buildings claim ongoing above the damage.

Good luck.

jaytee28

gm0 said:

Solicitor who has experience in this stuff. Is a good idea.  Highstreet random not so much. 

Contents insurance legal protection *may* be a route for some basics.  But as you may well have a claim there.  You may decide to save that one.

The managing agent may not be the owning freeholder and lessor (who may be in breach).  Your lease will tell all. But they are acting for them to day to day management.   You will need to target your action for lease breach appropriately

With an external corporate freeholder and a managing agent i.e. not share of freehold - legal threats and actions starting invites legal responses.  This does not as a generalisation speed things up.  You may want to gather more information and work out the full situation as best you can before clamming them up.  Softly softly, emergency repair needs etc.  Then bang bang.  Once you go in formally - informal discussion and information sharing likely stops.  Legal team responses only.  Their concerns become avoiding negligence, cost management, correct cost recovery process (for leases (avoiding a load of tribunal actions) enough activity progressing claims and project sourcing to defend negligence/lease breach claims - but certainly not minimum overall cost to you as leaseholders or rapidity of speed to fix.  All correspondence goes via their legal team.

Retirement living blocks seldom do Right To Manage and leaseholder collective purchase of freehold. It happens by exception.  For fairly obvious reasons (age of residents and nobody volunteering to do it, and capital availablility limited from retiree lessess. So the voting is an odditiy which needs explaining.

Check records more carefully and talk to neighbour leaseholders of longer standing.  Actual voting would normally imply an RTM arrangement or a share of freehold arrangement where it would be "normal" for the owners of said company.  To vote to instruct the directors of it (volunteers from among themselves) who deliver collective will to any hired by them agent. In rtm/sof - Owners are owners because they are leaseholders (lessees) and bought freehold into the ltd.  Or have exercised RTM without acquiring freehold (yet).

With a corporate agent and an external freehold (no RTM) - it could be a form of communication and establishing resident association "preference" and managing the "splash" of a possible out of warranty yet early and unexpected cash call on lessees for an early asset replacement beyond the sinking fund. 

Normally the sinking fund would save up for new lifts and roof repair of a building with very long leases - via a levy annually (part of service charge a levy), or by harvesting a payment (xn years occupancy) at lease assignment (resale).  While this latter is widely hated.  It reduces the retiree cashflow demands while living there.  And was a choice made at buying the lease.  Site cashflow may not be even, or sufficient of course if it relies on lease reassignment events.  Lease reassignment charges are usually on the face of the lease as a clause.  The annual sinking levy (if there is one) will be visible somewhere in annual service charge budgets.  And Section 20 will remain an option available for a cash call demand from freeholder to lessee in most cases.    It would be odd for a retirement flats company to have overly constrained their options.  So disputing *alternative* means proposed to manage cashflow can lead back to a Section 20 for the bill /n leases landing on the mat.

RA voting can be window dressing.  People do react even more poorly if they feel they were never engaged or consulted.  Absent RTM or Share of Freehold. The freeholder (via their agent) in discharge of their responsibilities - can do replacements and repairs and notify and recharge (as per Section 20) and other lease clauses based on the terms of the lease.  You have lessee rights re tribunal challenge - process followed - and reasonableness of amounts quoted but no actual "control" of what happens i.e. of solution choice.  Some ability to challenge a non-like for like replacement.  They can't wildly upgrade the building at your cost.  And they can't rope a lorry tarpaulin over it and claim to be done with a complete solution.  Of course it may be in your interests that the roof technology at replacement is different if the "old one" has proved so inadequate.  It depends.  Again be careful what you push for.

From the perspective of a freeholder with a few tens of thousands freehold land value (which leaseholders can buy out at par) with long leases demised on it.  They are not going to provide hundreds of thousands of capital to pay for a new roof.  They are going to repair or replace a roof and recharge to lessees under one of the routes permitted under the long 999 year leases.  It being a valid expectation that the roof would need repair or replacement in such a long lease period.   And "wear and tear" failure vs insured events like fire or storms (buildings insurance) mean that some repair and replace is "normally" funded that way.  Early replacement is something which is a problem for all involved.
If a roof fails absent a fire/storm insured event.  And is out of warranty.  Then the site sinking fund gathered from lessess against replacement costs is commonly the next port of call.  And a cash call (Section 20) after that (if exhausted).  Not knowing that possibility could come up doesn't make it go away.

This also happens in scenarios where it is decided that it is too late / too uncertain to spend tens of thousands or more in legal costs sueing an insurance company (of a former roofer/prime contractor developer) who will defend the claim - perhaps successfully.  Adding more cost. More delay.  Still no roof.  Sometimes even if it is suspected that poor workmanship was a "factor" in short life. Or was it design (architect deliverables).  Or materials (supplier).
It may be unrecoverable at a reasonable cost in practice once insurance company legal teams are on the case.

The exception would be with a newish building where a latent defect at construction / warranty claim against developer is feasible. The wear and tear failure is ridiculously early.  The defects are extreme and obvious.  The prime contractor or their insurers could be pursued to raise the funds to pay for the rework (And they can pursue their subs and any insurers but that's a them problem).  The freeholder in that scenario should  be doing that for their own and lessee benefit.

With an older building significantly out of any warranty - this is a fools errand.   As costs climb towards the cost of the works. Lawyers win.  Nobody else.

Back in the roof - there will be a decision chain (with or without a developer + insurance/surveyor dispute in it) from "OMG it ALL needs replacing" to "with what - same again or something else", "who pays", getting quotes and picking a contractor.  Following lessee notificaiton processes.  Communication. Meetings.  Section 20. etc.  Then finally contracting, scaffold. Works.

Whether it's external freeholder or share of freehold collective.  There is a natural grief cycle to go on.  Shock. Denial. Rage. Acceptance.  Nobody can easily sell at "normal" expected prices until this is sorted out once known in the local market.

Realistically emergency repairs *cannot* be allowed to screw up any surveying and latent defect attribution by destroying the disputed structure element (if developer insurers are being targeted for larger funding of replacement with a claim and their defense surveyors have yet to come).  If this is going on this usually means buckets until a certain point in the process is reached.  As doing emergency repairs with some random new player - cut out and patch and glue etc. Can shift the insurance liability dial.  And may become be a negligent act by the agent - just in a different direction.  Progressing the claim (at the speed of surveyors and lawyers) may in fact be the "not negligent path" for the agent progressing it for a freehold owning company with no operations of its own. 

This is why you need a better grasp of the timeline state of the process any third party claim (developer, insurer or not) and so on.  You can take a view on how long that will take.  And press for emergency repairs for the worst affected units pro-tem - where it doesn't kick over the long term solution.

Pressure including well drafted lease breach legal notices may need to be applied.  Loss adjusters and lawyers without a leaky ceiling are not hurrying

You also need to be careful to act in ways that don't invalidate your own contents insurance.  That insurer isn't going to be keen to pay for decor fixes repeatedly with an unfixed buildings claim ongoing above the damage.

Good luck.

Thank you so much for taking the time to provide such a detailed and helpful reply,  it's given me a lot to think about. 

gm0

No worries.  My family had one of these.  It is not fun.  But they were luckier than some in their flat.

eddddy

jaytee28 said:

I think I may contact a solicitor to go through what options I have. 

Have you clearly reported the leaks into your flat to the management company? Maybe in writing?

If so, what was the management company's reply? Are they refusing to fix the leaks?

Have you reached deadlock with the management company? If you haven't, it seems a bit early to be paying to talk to solicitors and 'going legal'.

The solicitor's first step is likely to be writing a firm letter to the management company saying something like "Repair the leaks in my client's flat".

If you haven't done so already, you could write the firm letter yourself saying "Repair the leaks in my flat".


If you want, you can book a free 15 minute phone call with the Leasehold Advisory Service to discuss this: https://clients.lease-advice.org/#/


And if you do eventually reach deadlock with the management company, and decide to 'go legal', here are the main options:  https://www.lease-advice.org/faq/there-is-damage-to-our-building-that-needs-to-be-repaired-what-can-i-do-to-get-it-fixed/

(That web page talks about the 'freeholder', but it equally applies to a 'management company'.)

jaytee28

eddddy said:

jaytee28 said:

I think I may contact a solicitor to go through what options I have. 

Have you clearly reported the leaks into your flat to the management company? Maybe in writing?

If so, what was the management company's reply? Are they refusing to fix the leaks?

Have you reached deadlock with the management company? If you haven't, it seems a bit early to be paying to talk to solicitors and 'going legal'.

The solicitor's first step is likely to be writing a firm letter to the management company saying something like "Repair the leaks in my client's flat".

If you haven't done so already, you could write the firm letter yourself saying "Repair the leaks in my flat".


If you want, you can book a free 15 minute phone call with the Leasehold Advisory Service to discuss this: https://clients.lease-advice.org/#/


And if you do eventually reach deadlock with the management company, and decide to 'go legal', here are the main options:  https://www.lease-advice.org/faq/there-is-damage-to-our-building-that-needs-to-be-repaired-what-can-i-do-to-get-it-fixed/

(That web page talks about the 'freeholder', but it equally applies to a 'management company'.)

Thank you for your message and advice. I should have explained a bit more in my original message, so apologies for that.

All the flats on the top floor of the building have reported leaks, the first ones were reported over a year ago.  The management company have had a survey done and been advised that a new roof is the only solution.  The issue at the moment is that the reserve fund will only cover re-roofing for part of the roof and that part will be where the first problems were reported,  so not my section.  A full re-roofing would involve an addional payment of £300 by each leaseholder.   I am certain that the majority of the leaseholders will vote for the option that doesn't cost them anything, so I guess the reason I posted on here was to ask for thoughts on whether I have any case against the management company (NB the leaks in the flats in my section are no different to those in the other part of the block, they were just reported later).

eddddy

jaytee28 said:

All the flats on the top floor of the building have reported leaks, the first ones were reported over a year ago.  The management company have had a survey done and been advised that a new roof is the only solution.  The issue at the moment is that the reserve fund will only cover re-roofing for part of the roof and that part will be where the first problems were reported,  so not my section.  A full re-roofing would involve an addional payment of £300 by each leaseholder.   I am certain that the majority of the leaseholders will vote for the option that doesn't cost them anything, so I guess the reason I posted on here was to ask for thoughts on whether I have any case against the management company (NB the leaks in the flats in my section are no different to those in the other part of the block, they were just reported later).

The vote is nonsense. It's like the management company giving the leaseholders a vote on whether to pay tax.

The leasholders would probably all vote against paying tax - but the law says they have to pay it. So the vote is a waste of time.


BUT... are you sure it's a vote, and not something called a 'Section 20 Consultation'?

Do any documents mention "Section 20 of the Landlord and Tenant Act 1985"?

If so, it's not a vote - it's the Management Company informing the leaseholders about their plans to repair/replace the roof. And they are inviting leaseholders to make observations and comments.

Here's some info on 'Section 20 Consultations':  https://www.lease-advice.org/faq/what-is-the-section-20-consultation-process-for-major-works/


More generally...

The management company has a duty to repair the leaks. If that requires a complete new roof, then that's what the management company have to do.

And if that requires a contribution of £300 from each leaseholder, again, that's what the management company have to arrange (after doing the section 20 consultation).


Paying for a new roof when required, is one of the responsibilities that all the leaseholders agreed to when they bought the leases of their flats. They can't now dodge their responsibilities.