First-tier Tribunal Grants Dispensation for Replacement Lift Consultation

OUTCOME: Allowed

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FIRST-TIER TRIBUNAL PROPERTY CHAMBER (RESIDENTIAL PROPERTY) Case reference : HAV/00HH/LDC/2024/0629/LC Property : Various properties at [ADDRESS] [POSTCODE] Applicant: [redacted] : [COMPANY]

Respondents : [redacted] : Application for the dispensation of consultation requirements pursuant to S.20ZA of the Landlord and Tenant Act 1985 Tribunal Members : Tribunal Judge Hugh Lumby Venue : Paper determination Date of Decision : 31 March 2025

DECISION

2 Decision of the Tribunal The Tribunal grants the application for the dispensation of all or any of the consultation requirements provided for by section 20 of the Landlord and Tenant Act 1985 (Section 20ZA of the same Act) in relation to major works with regard to the supply and installation a replacement lift in [NAME]. The background to 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. The application was received on 14 November 2024. 2. [NAME] comprises 28 flats within a 4-storey block of 1-bed and 2- bed flats, purpose built for retirement living.

3. The Applicant is the landlord of [NAME] and the Respondents comprise its [NAME].

4. The application relates to works at [NAME] to supply and install a replacement lift in [NAME].

5. The Applicant explains that the lift at [NAME] for residents’ use has been experiencing repeated failures and they were advised by their lift contractor that the lift needed replacing, despite only being installed three years ago. They were advised that the new lift would take 20 weeks to manufacture and a further 5 to 6 weeks to install.

6. This long lead-in time period persuaded the Applicant that unacceptable delays would be caused by carrying out a full section 20 compliant consultation and so they decided to truncate this, instead holding two seven-day long consultations. This has given the Respondents an opportunity to input into the process but does not comply with the consultation requirements of the 1985 Act, hence the need to seek dispensation in addition to the consultation.

7. Various comments were received from [NAME] but the Applicant argues that these do not show any prejudice to the Respondents by the granting of dispensation for the works.

8. Quotations for the works were obtained from [COMPANY] (who quoted £104,000 plus VAT) and [NAME] (who quoted £102,785 plus VAT). The contract for the works were awarded to [NAME] on 16 July 2024, with the Applicant absorbing the extra cost as a gesture of goodwill. At the time of the application, the new lift was being manufactured.

3 9. The Applicant has confirmed that the Respondents have all been informed of this application and no objections have been received from them.

10. By Directions of the Tribunal dated 28 February 2025 it was decided that the application be determined without a hearing, by way of a paper case.

11. The Tribunal did not inspect [NAME] as it considered the documentation and information before it in the set of documents prepared by the Applicant enabled the Tribunal to proceed with this determination.

12. This has been a paper determination which has not been objected to by the parties. The documents that were referred to are the Applicant’s application, a statement of case, a specimen lease, a list of the Respondents, details of the truncated consultation including quotations received and the Tribunal’s Directions dated 28 February 2025, the contents of which has been recorded. The issues 13. This decision is confined to determination of the issue of dispensation from the consultation requirements in respect of the qualifying long-term agreement. The Tribunal has made no determination on whether the costs are payable or reasonable. If a [NAME] wishes to challenge the payability or reasonableness of those costs as service charges, including the possible application or effect of the Building Safety Act 2022, then a separate application under section 27A of the Landlord and Tenant Act 1985 would have to be made. Law 14. Section 20 of the Landlord and Tenant Act 1985 (as amended) (“the 1985 Act”) and the Service Charges (Consultation Requirements) (England) Regulations 2003 require a landlord planning to undertake major works, where a [NAME] will be required to contribute over £250 towards those works, to consult the [NAME] in a specified form.

15. Should a landlord not comply with the correct consultation procedure, it is possible to obtain dispensation from compliance with these requirements by an application such as this one before the Tribunal. Essentially the Tribunal must be satisfied that it is reasonable to do so.

16. The Applicant seeks dispensation under section 20ZA of the 1985 Act from all the consultation requirements imposed on the landlord by section 20 of the 1985 Act.

4 17. Section 20ZA relates to consultation requirements and provides as follows: “(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 [NAME], for a term of more than twelve months. …. (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.

Findings 18. In the case of [COMPANY] v Benson [2013] UKSC 14, by a majority decision (3-2), the Supreme Court considered the dispensation provisions and set out guidelines as to how they should be applied.

19. The Supreme Court came to the following conclusions: a. The correct legal test on an application to the Tribunal for dispensation is: 

“Would the flat owners suffer any relevant prejudice, and if so, what relevant prejudice, as a result of the landlord’s failure to comply with the requirements?” b. The purpose of the consultation procedure is to ensure [NAME] are protected from paying for inappropriate works or paying more than would be appropriate.

5 c. In considering applications for dispensation the Tribunal should focus on whether the [NAME] were prejudiced in either respect by the landlord’s failure to comply. d. The Tribunal has the power to grant dispensation on appropriate terms and can impose conditions. e. The factual burden of identifying some “relevant prejudice” is on the [NAME]. Once they have shown a credible case for prejudice, the Tribunal should look to the landlord to rebut it. f. The onus is on the [NAME] to establish: i. what steps they would have taken had the breach not happened and ii in what way their rights under (b) above have been prejudiced as a consequence.

16.

Accordingly, the Tribunal had to consider whether there was any “relevant prejudice” that may have arisen out of the conduct of the Applicant and whether it was reasonable for the Tribunal to grant dispensation following the guidance set out above. Consideration 17. Having read the evidence and submissions from the Applicant and having considered all of the documents and grounds for making the application provided by the Applicant, the Tribunal determines the dispensation issues as follows.

18. The Applicant believed that the needs to have a properly working lift available for elderly residents and to avoid ongoing repair works combined with the long lead-in time to provide a new lift meant that holding a full consultation would cause unacceptable delay. On the evidence before it, the Tribunal agrees with the Applicant’s conclusions.

19. The Tribunal is of the view that, taking into account that there have been no objections to this application from the Respondents, it could not find prejudice to any of the [NAME] of [NAME] by the granting of dispensation relating to the urgent works to supply and install a new lift to replace the then current one in [NAME].

20. In doing so, it considered the comments received by the Applicant as part of its truncated consultation process. Whilst some of these may impact on the costs charged to [NAME], the Tribunal does not consider any reveal any relevant prejudice to the Respondents by granting dispensation.

6 21. As a result, the Tribunal believes that it is reasonable to allow dispensation in relation to the subject matter of the application.

22.

Accordingly, the Tribunal grants the Applicant’s application for the dispensation of all or any of the consultation requirements provided for by section 20 of the Landlord and Tenant Act 1985 in relation to major works with regard to the supply and installation of a replacement lift in [NAME].

23. The Applicant shall place a copy of the Tribunal’s decision on dispensation together with an explanation of the [NAME]’ appeal rights on its website (if any) within 7 days of receipt and shall maintain it there for at least 3 months, with a sufficiently prominent link to both on its home page. It should also be posted in a prominent position in the communal areas. In this way, [NAME] who have not returned the reply form may view the Tribunal’s eventual decision on dispensation and their appeal rights.

7

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]

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.