Queensmead NW8 Limited, Residents Management CompanyApplicant190 long residential leaseholders in 8 purpose built blocks of flats and 17 hous-es at QueensmeadRespondent
Before
Duncan Jagger MRICSDate 15 December 2020Property: Queensmead London NW8 6QU Queensmead NW8 Limited, ResidentsType of application: 20ZA of the Landlord and Tenant Act 1985
[1]The properties are, 8 purpose built blocks of flats and 17 houses at Queensmead together with 114 garages It is stated in the ap-plication there are 190 properties in total. The application refers speci-ficity to Mancroft Court containing 8 flats in a four storey block.[2]The tribunal did not inspect the property as it considered the docu-mentation and information before it in the trial bundle enabled the tri-bunal to proceed with this determination and also because of the re-strictions and regulations arising out of the Covid-19 pandemic.[3]This has been a paper hearing which has been consented to by the par-ties. The documents that were referred to are in a bundle prepared by the applicant, plus the tribunals Directions the contents of which we have recorded. Therefore, the tribunal had before it an electron-ic/digital trial bundle of documents prepared by the applicant, in ac-cordance with previous directions.[4]The Applicant seeks dispensation under section 20ZA of the Landlord and Tenant Act 1985 (“the 1985 Act”) from all the consultation re-quirements imposed on the landlord by section 20 of the 1985 Act, (see the Service Charges (Consultation Requirements) (England) Regula-tions 2003 (SI2003/1987), Schedule 4.) The request for dispensation concerns urgent works for the replacement of three outdated and obso-lete boilers dated and defective boilers together with auxiliary plant equipment installed in a boiler room. The application is said to be ur-gent, as the works are necessary to provide heating to the residents of the eight properties, with the communal heating system due to be turned on 1st October 2020.[5]The application is said to be urgent, as the works are necessary to pro-vide heating to the residents of the eight properties, with the commu-nal heating system due to be turned on 1st October 2020.[6]Section 20ZA relates to consultation requirements and provides as fol-lows: “(1)Where an application is made to a leasehold valuation tri-bunal for a determination to dispense with all or any of the consultation requirements in relation to any qualifying works or qualifying long term agreement, the tribunal may make the determination if satisfied that it is reasonable to dispense with the requirements. (2) In section 20 and this section— “qualifying works” means works on a building or any other premises, and “qualifying long term agreement” means (subject to subsection (3)) an agreement entered into, by or on behalf of the landlord or a superior landlord, for a term of more than twelve months. …. (4)In section 20 and this section “the consultation requirements” means requirements prescribed by regulations made by the Secretary of State. (5)Regulations under subsection (4) may in particular include provision requiring the landlord—(a) to provide details of proposed works or agreements to ten-ants or the recognised tenants’ association representing them,(b) to obtain estimates for proposed works or agreements,(c) to invite tenants or the recognised tenants’ association to propose the names of persons from whom the landlord should try to obtain other estimates,(d) to have regard to observations made by tenants or the rec-ognised tenants’ association in relation to proposed works or agreements and estimates, and(e) to give reasons in prescribed circumstances for carrying out works or entering into agreements.[7]The Directions on 3rd November 2020 required any tenants who op-posed the application to make their objections known on the reply form produced with the Directions. The Tribunal is aware that there has been one objection from Mrs Denise Goldstone of Flat 79 Sheringham Court NW8 6RB. This objection has been carefully considered by the tribunal The objection states there have been no estimates provided by the applicants agents and it is claimed there has not been a lack of transparency with all leaseholders in connection with this application and ongoing works[8]The statutory consultation procedure has commenced and all lease-holders with the first stage letter of intention under the Section 20 pro-cess on the 8th September 2020. Further, all leaseholders were in-formed by letter of the same date that an application has been made to the Tribunal for dispensation for the communal heating works The Dispensation was thought necessary to speed up the replacement of the obsolete boilers. The Decision[10]By Directions of the tribunal dated 3rd November 2020 it was decided that the application be determined without a hearing or by way of a video hearing. One objection to the application received but there was no such objection to the case being determined on written representa-tions.[11]The tribunal had before it a bundle of documents prepared by the ap-plicant that contained the application, grounds for making the applica-tion, specimen lease the tribunal Directions and a letter from Mrs Den-ise Goldstone objecting to the application.[13]The only issue for the Tribunal to decide is whether or not it is reason-able to dispense with the statutory consultation requirements. This application does not concern the issue of whether or not ser-vice charges will be reasonable or payable.[14]Having read the evidence and submissions from the Applicant and hav-ing considered all of the documents and grounds for making the appli-cation provided by the applicant, the Tribunal determines the dispen-sation issues as follows.[15]Section 20 of the Landlord and Tenant Act 1985 (as amended) and the Service Charges (Consultation Requirements) (England) Regulations 2003 require a landlord planning to undertake major works, where a leaseholder will be required to contribute over £250 towards those works, to consult the leaseholders in a specified form.[16]Should a landlord not comply with the correct consultation procedure, it is possible to obtain dispensation from compliance with these re-quirements by such an application as is this one before the Tribunal. Essentially the Tribunal must be satisfied that it is reasonable to do so.[17]In the case of Daejan Investments Limited v Benson [2013] UKSC 14, by a majority decision (3-2), the Supreme Court considered the dispen-sation provisions and set out guidelines as to how they should be ap-plied.[18]The Supreme Court came to the following conclusions:a. The correct legal test on an application to the Tribunal for dis-pensation is: “Would the flat owners suffer any relevant prejudice, and if so, what relevant prejudice, as a result of the landlord’s failure to comply with the requirements?”b. The purpose of the consultation procedure is to ensure lease-holders are protected from paying for inappropriate works or paying more than would be appropriate.c. In considering applications for dispensation the Tribunal should focus on whether the leaseholders were prejudiced in either re-spect by the landlord’s failure to comply.d. The Tribunal has the power to grant dispensation on appropri-ate terms and can impose conditions.e. The factual burden of identifying some relevant prejudice is on the leaseholders. Once they have shown a credible case for prej-udice, the Tribunal should look to the landlord to rebut it.f. The onus is on the leaseholders to establish: i. what steps they would have taken had the breach not happened and ii. in what way their rights under (b) above have been prej-udiced as a consequence.[16]Accordingly, the Tribunal had to consider whether there was any prej-udice that may have arisen out of the conduct of the applicant and whether it was reasonable for the Tribunal to grant dispensation fol-lowing the guidance set out above.[17]The tribunal is of the view that, taking into account the one objection, it could not find prejudice to any of the leaseholders of the property by the granting of dispensation relating to the essential replacement of the three obsolete boilers and auxiliary plant equipment providing heating to the block of eight flats as set out in the documentation in the trial bundle submitted in support of the application.[18]The Tribunal was mindful of the fact that the works are being under-taken by the applicant supported by managing agents and with a prop-er estimate submitted by London Plant Room Services Ltd the current maintenance contractor dated 30th July 2020, in the sum of £46,677.60 and that therefore dispensation is wholly appropriate.[19]The applicant and the contractors believe that the works are vital and this is a health and safety issue affecting the eight residents identified in this block. The applicant also says that in effect the tenants of the properties have not suffered any prejudice by the failure to consult pri-or to the undertaking of these works. On the evidence before it the Tri-bunal agrees with this conclusion and believes that it is reasonable to allow dispensation in relation to the subject matter of the application. It must be the case that the applicant must ensure that adequate heat-ing is provided to the leaseholders in accordance with the terms of the lease especially through the winter moths.The replacement boiler works should therefore be carried out as a matter of urgency, hence the decision of the Tribunal.[20]Rights of appeal made available to parties to this dispute are set out in an Annex to this decision.[21]The applicant shall be responsible for formally serving a copy of the tribunal’s decision on all leaseholders named on the schedule attached to the application. Furthermore, the applicant shall place a copy of the tribunal’s decision on dispensation together with an explanation of the leaseholders’ appeal rights on its website (if any) within 7 days of re-ceipt and shall maintain it there for at least 3 months, with a sufficient-ly prominent link to both on its home page. Copies must also be placed in a prominent place in the common parts of the buildings. In this way, leaseholders who have not returned the reply form may view the tribu-nal’s eventual decision on dispensation and their appeal rights.The Tri-bunal requests the applicant to confirm to the Tribunal this has been carried out. Name: Mr D Jagger MRICS Date: 25 November 2020 ANNEX - RIGHTS OF APPEAL[1]If a party wishes to appeal this decision to the Upper Tribunal (Lands Chamber) then a written application for permission must be made to the First-tier Tribunal at the Regional office which has been dealing with the case.[2]The application for permission to appeal must arrive at the Regional office within 28 days after the Tribunal sends written reasons for the decision to the person making the application.[3]If the application is not made within the 28 day time limit, such appli-cation must include a request for an extension of time and the reason for not complying with the 28 day time limit; the Tribunal will then look at such reason(s) and decide whether to allow the application for permission to appeal to proceed despite not being within the time lim-it.[4]The application for permission to appeal must identify the decision of the Tribunal to which it relates (i.e. give the date, the property and the case number), state the grounds of appeal, and state the result the par-ty making the application is seeking.