Section 20 notice

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    Section 20 notice

    Works have been proposed for a block of residential flats - electric and lighting work; decoration; and fixture replacement. The cost is due to come one third out of the service charge fund and one third out of a levy outside the service charge but with no clear distinction as to which cost is attributed to which works. No section notices have been issued although the cost coming out of the service charge cost is over £250 per flat. My questions are 'should a particular work be allocated to the service charge followed by a section 20 notice?' and, for the additional levy is a section 20 notice again required or is a levy outside the section 20 notice requirements? If the levy is outside section 20, is the decision to spend it made by a majority vote or does the vote in favour have to be unanimous? Thank you.

    #2
    Whether it comes from reserve funds is irrelevant to the need to do S20

    Decisions are not based on a vote (minority, majority or anything else) -- they are (generally) based on what the leases says. Minor things like the color of the paint can be voted on. The lease usually dictates the purpose of the reserve fund and whether it can be collected at all

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      #3
      There is no reserve fund and the levy the directors intend to ask for comes from people being asked to contribute 'voluntarily' to the remaining two thirds cost (sorry meant to say above that two thirds of the costs would come out of a levy, not one third) of the work being proposed. At the moment the residents appear to be in agreement with this and the managing agent will get an undertaking that people will honour their commitment to pay before work starts so I'm presuming this is outside a s20 notice? On this basis from what you say above, I presume the remaining one third cost will still be subject to a s20 notice?

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        #4
        That sounds a nonsense I'm afraid. Do the team have a clue what they are doing???

        What is the authority for this levy, and what possible reason for it?

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          #5
          As AndrewDod has said, you need to explain what the circumstances involved are here.

          If all of the proposed work is work that the freeholder is obligated to carry out under the terms of the lease, there cannot be any 'voluntary' part of the costs - either the leaseholders are obligated to pay their share. or the costs fall on the freeholder.
          If the proposals include work that is not required under the terms of the lease (e.g. some types of improvements rather than required maintenance, it is possible for the freeholder to say that the work will be done if sufficient funding is raised from voluntary contributions - but no one can be obligated to contribute.

          Section 20 consultation should apply to all work that leaseholders will be obligated to contribute to, if they will have to contribute more than £250, but realistically the legislation is now practically worthless in most respects.

          Either you haven't clearly stated what is proposed, or the people proposing the work really don't have a clue what they are doing (perhaps a combination of both).

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            #6
            Many thanks for your responses. You are right in saying that what is happening is not clear and I'm trying to get to the bottom of it but what you have both said above is really helpful and gives me a way forward - thank you.

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