28 - 30 Lennox Gardens London SWTX 0DQ LON/00AW/LDC/2021/0083
FIRST-TIER TRIBUNAL
PROPERTY CHAMBER (RESIDENTIAL PROPERTY)
Case No LON/00AW/LDC/2021/0083
Between
The Wellcome TrustApplicantLeaseholders of the property (list attached to application).Respondent
Before
JudgeProfessor R PercivalVenue Remote paper determinationDate 27 September 2021Property: SWTX 0DQ The Wellcome Trust, representedType of application: Tenant Act 1985 section 20ZA
DECISION
[1]The Tribunal, pursuant to section 20ZA of the Landlord and Tenant Act 1985 (“the 1985 Act”), grants retrospective dispensation from the consultation requirements in respect of the works the subject of the application. Procedural[1]The landlord submitted an application for dispensation from the consultation requirements in section 20 of the Landlord and Tenant Act 1985 and the regulations thereunder, dated 23 March 2021.[2]The Tribunal gave directions on 23 April 2021. The directions provided for a form to be distributed to those who pay the service charge to allow them to object to or agree with the applications, and, if objecting, to provide such further material as they sought to rely on. The application and directions was required to be sent to the leaseholders and any sublessees, and to be displayed as a notice in the common parts of the property. The deadline for return of the forms, to the Applicant and the Tribunal, was 21 May 2021.[3]The Applicant confirmed that the relevant documentation had been sent, and posted as notices, as required by the directions.[4]No response from a leaseholder has been received by the Tribunal. The property and the works[5]The property is a masonry and brick building of the early 20th century, converted into seven flats.[6]The works, which have been carried out, were required to repair a leak into a ground floor flat, originally reported in November 2020. It was necessary to erect scaffolding, in the first instance, so as to remove ivy and/or Virginia creeper, in order to investigate the site of the water ingress. This was attributed to cracking around a window, once investigation was possible. This was repaired. The total cost was £7,075.81, inclusive of VAT.[7]The Applicant’s statement relies on the urgency of undertaking the works, and on the fact that, as a result of the Covid-19 pandemic, the residents of the ground floor flat “were not comfortable with different contractors having access through their flat to inspect and price the works”, as would be necessary if the consultation requirements were to be satisfied. Determination[8]The Tribunal is concerned solely with an application under section 20ZA of the 1985 Act to dispense with the consultation requirements under section 20 of the same Act.[9]In the first place, I accept that there was at least a degree of urgency. Photographs included in the bundle show damage presumably attributable to the water ingress in the flat, although I note that (from this minimal evidence) the damage does not look extensive.[10]Secondly, I do not consider that the understandable stance of the residents of the flat on its own constitutes independently a good reason for dispensation. It is the other leaseholders who might benefit from the consultation process, should it result in the work being undertaken more cheaply, not just the residents of the flat affected. For the ground floor flat residents’ concerns to constitute a good reason for dispensation, it would be necessary for the Applicant to show that it had conducted an appropriate balancing exercise between the interests of the residents in the affected flat and the other leaseholders.[11]However, there considerations are, in the context of this case, academic. No responses have been received from any of the leaseholders. It is therefore clear that no leaseholder has sought to claim any prejudice as a result of the consultation requirements not having been satisfied. Where that is the case, the Tribunal must, quite apart from any question of urgency, allow the application: Daejan Investments Ltd v Benson and others [2013] UKSC 14; [2013] 1 WLR 854.[12]This application relates solely to the granting of dispensation. If the leaseholders consider the cost of the works to be excessive or the quality of the workmanship poor, or if costs sought to be recovered through the service charge are otherwise not reasonably incurred, then it is open to them to apply to the Tribunal for a determination of those issues under section 27A of the Landlord and Tenant Act 1985. Name: Judge Prof Richard Percival Date: 27 September 2021 Appendix of relevant legislation Landlord and Tenant Act 1985 (as amended) Section 20 (1) Where this section applies to any qualifying works or qualifying long term agreement, the relevant contributions of tenants are limited in accordance with subsection (6) or (7) (or both) unless the consultation requirements have been either— (a) complied with in relation to the works or agreement, or (b) dispensed with in relation to the works or agreement by (or on appeal from) the appropriate tribunal .[2]In this section “relevant contribution”, in relation to a tenant and any works or agreement, is the amount which he may be required under the terms of his lease to contribute (by the payment of service charges) to relevant costs incurred on carrying out the works or under the agreement.[3]This section applies to qualifying works if relevant costs incurred on carrying out the works exceed an appropriate amount.[4]The Secretary of State may by regulations provide that this section applies to a qualifying long term agreement—(a) if relevant costs incurred under the agreement exceed an appropriate amount, or(b) if relevant costs incurred under the agreement during a period prescribed by the regulations exceed an appropriate amount.[5]An appropriate amount is an amount set by regulations made by the Secretary of State; and the regulations may make provision for either or both of the following to be an appropriate amount—(a) an amount prescribed by, or determined in accordance with, the regulations, and(b) an amount which results in the relevant contribution of any one or more tenants being an amount prescribed by, or determined in accordance with, the regulations.[6]Where an appropriate amount is set by virtue of paragraph (a) of subsection (5), the amount of the relevant costs incurred on carrying out the works or under the agreement which may be taken into account in determining the relevant contributions of tenants is limited to the appropriate amount.[7]Where an appropriate amount is set by virtue of paragraph (b) of that subsection, the amount of the relevant contribution of the tenant, or each of the tenants, whose relevant contribution would otherwise exceed the amount prescribed by, or determined in accordance with, the regulations is limited to the amount so prescribed or determined.] Section 20ZA(1) Where an application is made to a leasehold valuation tribunal 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.(3) The Secretary of State may by regulations provide that an agreement is not a qualifying long term agreement— (a) if it is an agreement of a description prescribed by the regulations, or (b) in any circumstances so prescribed.(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 tenants 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 recognised 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.(6) Regulations under section 20 or this section— (a) may make provision generally or only in relation to specific cases, and (b) may make different provision for different purposes.(7) Regulations under section 20 or this section shall be made by statutory instrument which shall be subject to annulment in pursuance of a resolution of either House of Parliament.