First-tier Tribunal Grants Dispensation for Cleaning Services Contract

OUTCOME: Allowed

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FIRST-TIER TRIBUNAL PROPERTY CHAMBER (RESIDENTIAL PROPERTY)

Case Reference

:

CHI/21UH/LDC/2023/0162

Property

:

Various Properties of Wealden District Council (2)

Applicant

:

[redacted]

Representative

:

Respondent: [redacted]

:

Type of Application

:

To dispense with the requirement to consult lessees about major works section 20ZA of the Landlord and Tenant Act 1985

Tribunal member

:

[NAME], Regional Surveyor

Date of Decision

:

26 February 2024

DECISION

The Tribunal grants dispensation from the consultation requirements of S.20 Landlord and Tenant Act 1985 in respect of entering into a QLTA contract for the provision of cleaning of communal areas

In granting dispensation, the Tribunal makes no determination as to whether any service charge costs are reasonable or payable.

2 Background

1. The Applicant seeks dispensation under Section 20ZA of the Landlord and Tenant Act 1985 from the consultation requirements imposed on the landlord by Section 20 of the 1985 Act. This retrospective application was received on 28 November 2023 and concerns a qualifying long-term agreement that has already been entered into on 1 April 2023.

2. The properties concerned are described as,

The Council's sheltered accommodation housing stock, consisting of 60 properties on 6 estates

3. The Applicant states that the qualifying long-term agreement relates to, A contract for the provision of cleaning of communal areas entered into further to the Council’s covenant with its long leasehold tenants to to [sic] keep in good and substantial repair and condition and to renew amend and clean when and as necessary and appropriate (i) The main structure of the building or buildings comprised in the Development

4. Dispensation is sought to,

… correct the error regarding the figures, which would allow the Council to claim the correct amount due from the tenants for the cleaning services provided.

5. The Applicant provides a detailed explanation as to the consultation process and further, why dispensation is sought in paragraphs 2 and 3 on pages 7 and 8 of the application form.

6. The Tribunal made Directions on 2 January 2024 which required the Applicant to send it to the Lessees together with a form for them to indicate to the Tribunal whether they agreed with or opposed the application and whether they requested an oral hearing. If [RESPONDENT] agreed with the application or failed to return the form they would be removed as a Respondent although they would remain bound by the Tribunal’s Decision.

7. The Applicant confirmed on 12 January 2024 that the Directions had been served on the Respondents by First Class post and on 20 February 2024 that no responses had been received. No requests for an oral hearing were made. The matter is therefore determined on the papers in accordance with Rule 31 of the Tribunal’s Procedural Rules.

8. Before making this determination, the papers received were examined to determine whether the issues remained capable of

3 determination without an oral hearing and it was decided that they were, given that the application remained unchallenged.

The Law

9. The relevant section of the Act reads as follows:

S.20 ZA Consultation requirements: 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.

10. The matter was examined in some detail by the Supreme Court in the case of [COMPANY] v [NAME]. In summary the Supreme Court noted the following. a. The main question for the Tribunal when considering how to exercise its jurisdiction in accordance with section 20ZA is the real prejudice to the tenants flowing from the landlord’s breach of the consultation requirements. b. The financial consequence to the landlord of not granting a dispensation is not a relevant factor. The nature of the landlord is not a relevant factor. c. Dispensation should not be refused solely because the landlord seriously breached, or departed from, the consultation requirements. d. The Tribunal has power to grant a dispensation as it thinks fit, provided that any terms are appropriate.

e. The Tribunal has power to impose a condition that the landlord pays the tenants’ reasonable costs (including surveyor and/or legal fees) incurred in connection with the landlord’s application under section 20ZA (1). f. The legal burden of proof in relation to dispensation applications is on the landlord. The factual burden of identifying some “relevant” prejudice that they would or might have suffered is on the tenants. g. The court considered that “relevant” prejudice should be given a narrow definition; it means whether non-compliance with the consultation requirements has led the landlord to incur costs in an unreasonable amount or to incur them in the provision of services, or in the carrying out of works, which fell below a reasonable standard, in other words whether the non-compliance has in that sense caused prejudice to the tenant. h. The more serious and/or deliberate the landlord's failure, the more readily a Tribunal would be likely to accept that the tenants had suffered prejudice.

4 i. Once the tenants had shown a credible case for prejudice, the Tribunal should look to the landlord to rebut it.

Evidence

11. The Applicant’s case is set out in paragraphs 2, 3 & 4 above.

Determination

12. Dispensation from the consultation requirements of S.20 of the Act may be given where the Tribunal is satisfied that it is reasonable to dispense with those requirements. Guidance on how such power may be exercised is provided by the leading case of [NAME] v [NAME] referred to above.

13. No objections have been received from the Respondents identifying the type of prejudice referred to in the [NAME] case and in these circumstances I am prepared to grant dispensation.

14. The Tribunal therefore grants dispensation from the consultation requirements of S.20 Landlord and Tenant Act 1985 in respect of entering into a QLTA contract for the provision of cleaning of communal areas

15. In granting dispensation, the Tribunal makes no determination as to whether any service charge costs are reasonable or payable.

[NAME] 26 February 2024

RIGHTS OF APPEAL

1. A person wishing to appeal this decision to the Upper Tribunal (Lands Chamber) must seek permission to do so by making written application by email to [EMAIL] to the First-tier Tribunal at the Regional office which has been dealing with the case.

2. The application must arrive at the Tribunal within 28 days after the Tribunal sends to the person making the application written reasons for the decision.

3. If the person wishing to appeal does not comply with the 28 day time limit, the person shall include with the application for permission to appeal a request for an extension of time and the reason for not complying with the 28 day time limit; the Tribunal will then decide

5 whether to extend time or not to allow the application for permission to appeal to proceed.

4. The application for permission to appeal must identify the decision of the Tribunal to which it relates, state the grounds of appeal, and state the result the party making the application is seeking.