Section 20 Consultation
What is Section 20 consultation?
If a freeholder of a property containing leasehold properties (including a freehold company in the case of a ‘share of freehold’ property) they are legally obliged to formally and meaningfully consult with leaseholders before carrying out works that will cost any one leaseholder more than £250.00 or before entering into a contract that will last more than a year and cost more than £100.00 for a single leaseholder.
This consultation must be carried out as required by Section 20 of the Landlord and Tenant Act 1985 (as amended) and will need to comply with the The Service Charges (Consultation Requirements) Regulations 2003.
What section 20 consultation is not undertaken?
Failure to comply with the consultation procedures of Section 20 of the Landlord and Tenant Act 1985 can result in a freehold being limited to collecting £250.00 per leaseholder for works or £100.00 for a long-term agreement, which is a risk that most freehold landlords should be seriously concerned about.
What factors impact carrying out section 20 consultation correctly?
Firstly a freeholder needs to ensure that any consultation is meaningful and focused on the reasonable objectives of undertaking necessary works while providing value for money. If it can be reasonably identified that the consultation is just a tick box exercise which the freeholder never intended to have regard to the leaseholders as part of the process then a tribunal could rule that a consultation has not been undertaken correctly despite meeting other essential criteria.
A freeholder must ensure that their notices are served correctly in an appropriate format, respecting the exact circumstances of the proposed works. Freeholders will need to ensure that all steps of the process are undertaken including having regard to and responding to observations from leaseholders and carrying out tendering for contracts by nominated contractors in line with legal requirements. Freeholders should also be aware of the implication of case law on their procedures.
Can I get help if I have received an invoice without consultation under section 20?
Many freeholders take advantage of leaseholders by carrying out large works and recharging the costs to leaseholders without undertaking meaningful consultation, knowing all to well that leaseholders will find it difficult to find help and support to challenge them. Fortunately, The Leasehold Company specialise in protecting leaseholders from unfair service charges and will help you fight back. If you believe that you have not been consulted with correctly, then please contact us for a no obligation discussion of how we can help.