First-tier Tribunal Grants Dispensation for Energy Procurement Agreements

OUTCOME: Allowed

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FIRST-TIER TRIBUNAL PROPERTY CHAMBER (RESIDENTIAL PROPERTY)

Case Reference

:

CHI/ 45UH/LDC/2019/0039

Property

:

[ADDRESS], [ADDRESS], [COMPANY_1], Flats 2/[ADDRESS], [COMPANY_1] [POSTCODE] Various Properties at [ADDRESS], [ADDRESS], [COMPANY_1], West Sussex [POSTCODE]

Applicant

:

[redacted]

:

[NAME_2] (Leasehold Advisor)

Respondents

:

[redacted] attached to the Application

Representative

:

-

Type of Application

:

To dispense with the requirement to consult lessees about major works

Tribunal Member(s)

:

Judge Tildesley OBE

Date and Venue of Hearing

:

Determination on Papers

Date of Decision

:

19 July 2019

DECISION

2 The Application

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.

2. The Applicant explains that it wishes to enter into Long Term Agreement with the [COMPANY_3] which offers bespoke energy procurement services to obtain competitive prices for energy supplies. The Applicant states that [NAME_3] act for a number of [NAME_4] which means that it would be part of a ½ billion pound pot enabling [NAME_4] to get value for money on energy costs for their residents.

3. The Applicant further explains that The [COMPANY_3] will be procuring energy at the time they identify a deal on the wholesale market. According to the Applicant, quotations for energy only tend to be held for a matter of hours, and [NAME_3] will have to react quickly to get the best prices for the Applicant. This means that the Applicant will not be able to supply estimated costs and carry out a consultation process. The Applicant is, therefore seeking dispensation from consultation in respect of two [NAME_5], with the gas and electricity suppliers. The [NAME_5] will be for the period 1 October 2019 to 31 September 2023.

4. The Application for dispensation was received on 17 May 2019.

5. On 22 May 2019 the Tribunal directed the Applicant on receipt of these directions to send them together with a copy of the application to each Respondent. On 30 May 2019 the Applicant confirmed to the Tribunal that this has been done.

6. The Applicant served the Tribunal with a hearing bundle of documents on 5 July 2019. . Determination

7. The Tribunal is satisfied from the application and the documents that the tenants would benefit from entering into a long term qualifying agreements for the supply of energy procured by the [COMPANY_3]. This is because the Applicant would be able to take advantage of competitive energy prices for communal lighting and heating which would not be possible if the Applicant had to consult whenever it entered into agreements for energy supplies.

8. The Tribunal received responses from eleven leaseholders who all agreed with the Application.

9. The Tribunal, therefore, dispenses with the consultation requirements in respect of the qualifying long term agreements procured by the [COMPANY_3] with the gas and

3 electricity suppliers. The period of the agreement will be October 2019 to September 2023.

10. The Tribunal’s decision is confined to the dispensation from the consultation requirements in respect of the qualifying long term agreements. The Tribunal has made no determination on whether the costs of those agreements are reasonable or payable. If a leaseholder wishes to challenge the reasonableness of those costs, then a separate application under section 27A of the Landlord and Tenant Act 1985 would have to be made.

11. The Tribunal will send a copy of the decision to the leaseholders who responded. The Tribunal asks the Applicant to inform the other leaseholders of this decision by way of noticeboard or other forms of communication.

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 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 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.