Section 20 works notification - help needed as leaseholder

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    Section 20 works notification - help needed as leaseholder

    I am a leaseholder in a block of flats in London. I have recently received a postal letter from our Managing Agent regarding Section 20 works being carried out on our building. This letter appears to be a Notice of Estimates, and references a previous letter, which i presume was a Notice of Intention that i never received. This may be because I live abroad and the original letter never made it's way to my forwarding address, though all correspondence with our Managing Agent is usually via email (which is my selected form of communication) so i'm unsure why they have elected to use a conventional letter as a means of communication in this instance.

    Regardless, I am very concerned about the three estimates quoted, which are between 195k - 205k. This letter does not cite what the works are for, but does say that the Managing Agent has recommended going with a quote which is not the cheapest, and furthermore says that an 11% CDM administration fee and 5% S20 administration fee will be added on top of the total cost. this seems very excessive.

    What rights do i have to fight this Section 20? Research suggests that the I can go to the First-tier Tribunal (Property Chamber), but i do not know on what grounds I can bring a charge. Does their failure to communicate the original letter via my selected form of correspondence (email) give me further grounds to reject this Section 20?

    So far I have written to the Managing Agent (via email) asking for more details but they have not responded. I have called them and left messages but they have no rang back.

    Many thanks for any welcomed advice!

    #2
    Any form of communication allowed by the lease is going to be acceptable. I'd actually suggest that paper delivery is the gold standard. Is the lease recent enough to actually allow for electronic communications as a valid form of notice? How would you deal with a formal notice from the council, e.g. a planning application or dangerous structure notice? I assume the tenant was responsible for forwarding, as notices can simply be attached to the property, and only Royal Mail normally forwards.

    In stage 2, you have the right to go and inspect the full quotes, which really ought to tell you exactly what is being done.


    The CDM fee seems high, but will probably have been listed in the agent's menu of prices.

    They didn't have to indicate their recommendation at this stage, although, if they go that way, they must explain the decision in the third stage.

    A 5% spread suggests that the specification was well written.

    The best contractor often isn't the cheapest.

    Section 20 now no longer effectively limits costs to the £250 per leaseholder. Any compensation would be based on the difference between the actual cost and the best possible cost, but you would have to prove that the reasons for going for the higher bid were not reasonable.

    My feeling is that the only issue on which you might have some grounds to complain are the agent's project fees, but those are outside of section 20.

    I think it would have been good manners to resend the stage one consultation document, when requested, although you could always ask a neighbour.

    At the moment, I would say that any request for a ruling for from the FTT would be on the basis of reasonableness, not on section 20 issues.

    Comment


      #3
      thank your detail response. The lease is from 2007 - not sure about referenced form of communication, though I find it strange that they communicate all other correspondence (notifications, fee payment requests, updates and newsletters) via email, but choose to notify this by letter only.

      you mention that "The CDM fee seems high, but will probably have been listed in the agent's menu of prices." - can you explain more about what you mean? GBP22,000 seems very high on a project.

      many thanks

      Comment


        #4
        Surveyor type fees are generally quoted as a percentage of the contract price, not as set sums of money. I would expect the Health and Safety (CDM) element to be about 3-5%.

        I suspect your S20 fees are actually two things, The larger part will be the project management fees for specifying the work, vetting and selecting the contractor, approving completion of or work, handling contract variations (as problems are found that weren't known at specification time), making staged payments. The smaller part will the fee for actually doing the section 20 consultation, itself. 5% would be a real bargain for that, so maybe the have included project management in the CDM figure.

        I think I would expect the sum of the mark-ups to come to between 8 and 15%. In 2012, using a surveyor but on agent, I think they summed to about 13% for us (might have been 15%). Our current agent is quoting 8% in their Ts & Cs, but they are too new to know whether there will be any additional fees, e.g. to external professionals.

        I suspect the reason your agent used paper, this time, is that the process is time critical. With ground rent demands, they can always reissue the demand on paper, if you don't actually pay. With S20, any failure to deliver the notice could put the whole job back.

        Comment


          #5
          Dear Leaseholder64

          Could you kindly signpost me to information related to:

          'Section 20 now no longer effectively limits costs to the £250 per leaseholder. Any compensation would be based on the difference between the actual cost and the best possible cost, but you would have to prove that the reasons for going for the higher bid were not reasonable.'

          Thank you.

          Kind regards


          Comment


            #6
            Originally posted by vmart View Post
            Could you kindly signpost me to information related to:

            'Section 20 now no longer effectively limits costs to the £250 per leaseholder. Any compensation would be based on the difference between the actual cost and the best possible cost, but you would have to prove that the reasons for going for the higher bid were not reasonable.
            Look at the 2013 Supreme Court case of Daejan Investments Ltd versus Benson.

            Dispensation for not carrying out section 20 consultation properly still technically needs to be granted, but the decision effectively means that any reduction in costs will only be to the amount that the leaseholds would reasonably have been expected to pay for any work that was actually required.


            In answer to the OPs problem, I would contact the freeholder, or whoever is dealing with the Section 20 consultation on their behalf, repeatedly, requesting copies of all information that has not been received, and pointing out that you cannot properly comment on the proposals until you have received this information.
            At the very least, if the information you require is not provided promptly, this will potentially make it seem more reasonable if you later want to rely on an objection that you did not raise during the consultation period.

            Comment


              #7
              Dear Macromia

              Thank you.

              Comment

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