First-tier Tribunal Grants Dispensation from Consultation Requirements

OUTCOME: Allowed

1

FIRST-TIER TRIBUNAL PROPERTY CHAMBER (RESIDENTIAL PROPERTY) Case reference : MAN/00BY/LDC/2022/0006

Property : [APPELLANT], [ADDRESS] [POSTCODE]

Applicant: [redacted]

:

[NAME]

Respondent: [redacted] of [APPELLANT] of application : Landlord & Tenant Act 1985 [POSTCODE]

Tribunal Members : [NAME] [NAME] (Chairman) [NAME] W Reynolds MRICS

Date of decision : 27 June 2022

DECISION

© CROWN COPYRIGHT 2022

2 DECISION

Pursuant to section 20ZA of the Landlord and Tenant Act 1985 the Tribunal makes a determination to dispense with the requirement for the Applicant to consult with the Respondents on the procurement of insurance cover under a long-term agreement for three-years commencing 20 September 2021.

REASONS

The Application 1. The application (‘the Application’) was made on 18 January 2022 by the Applicant’s Representative. It seeks dispensation under section 20ZA of the Landlord and Tenant Act 1985 (‘the Act’) in relation to the statutory consultation requirements prescribed by Section 20. The Applicant entered into a qualifying long-term agreement relating to the provision of insurance cover for [APPELLANT], with [NAME], commencing 20 September 2021. The policy provides cover for one year but automatically renews on each anniversary at a fixed cost over a three-year period. 2. [APPELLANT] is a purpose built scheme comprising 415 units, located within 13 separate blocks of flats. The Respondents are the leaseholders of the flats. The Applicant is a [COMPANY] landlord of whom all the Board of Directors are also leaseholders.

3. Directions were issued on 28 March 2022. The Applicant was directed to provide details of the Application to all Respondents. The Respondents were, thereafter, invited to notify the Tribunal if they opposed the application and, if so, provide a statement in response to the Application.

4. The Applicant’s Representative confirmed to the Tribunal on 11 April 2022 that the Directions had been complied with. No responses were received by the Tribunal from any Respondents opposing the application.

5. The Application detailed terms of the insurance cover, details of market testing undertaken by the broker, benefits of the cover, costs of the cover in total and to each individual leaseholder. The Application also detailed why it had not been possible to comply with the consultation requirements of Section 20 due to the [COMPANY] time within which the offer was available to be accepted by the Board of Directors (who are all leaseholders contributing to the costs of the cover). In view of there being no ‘active’ Respondents opposing the Application, it is not necessary to reproduce that information in any detail within this decision. The Law 6. Extracts from Sections 20 and 20ZA of the Act are appended.

7. The Tribunal considers the Supreme Court case of [COMPANY] v [NAME] and Others [2013] UKSC 14 (‘Daejan’) to be the leading case on dispensation. In Daejan Lord [NAME] stated that in deciding pursuant to

3 section 20ZA whether it is reasonable to dispense with consultation requirements, a tribunal should consider whether any relevant prejudice would be suffered by the leaseholders. Lord [NAME] stated that whilst the legal burden of proof rests throughout on the landlord, the factual burden of identifying some relevant prejudice that they would or might have suffered rested on the tenants. Determination 8. In this case, none of the Respondents have opposed the Application. The Tribunal finds therefore, that there is no relevant prejudice identified by any Respondent, suffered as a consequence of the Applicant’s decision not to follow the consultation requirements prescribed by Section 20 of the Act.

9. A decision on the issue of dispensation does not concern the issue of whether any service charge costs resulting from any agreement are reasonably incurred or payable.

10. In the circumstances of this case, the Tribunal considers it reasonable to dispense with the consultation requirements.

Accordingly, the Tribunal makes a determination under section 20ZA of the Act to dispense with the requirement to consult with the Respondents under Section 20, in relation to the procurement of insurance cover under a long-term agreement for three years commencing 20 September 2021.

[NAME] Tribunal Judge 27 June 2022

4 Annex: List of [COMPANY] [NAME] & Mrs [NAME] [NAME] & Mrs [NAME] [NAME] [NAME] [NAME] & Mrs [NAME] K [NAME] [NAME] & Mrs [NAME] Dr [NAME] [NAME] & Mrs [NAME] [NAME] & Mrs [NAME] Dr [NAME] [NAME] & Mrs [NAME] [NAME] & Mrs [NAME] [NAME] [NAME] [NAME] & Mrs [NAME] [NAME] & Mrs [NAME] Dr [NAME] [NAME] & Mrs [NAME] [NAME] & Mrs [NAME] Dr [NAME] [NAME] [NAME] & Mrs [NAME] [NAME] [NAME] Dr [NAME] [NAME] & Mrs D [NAME] [NAME] [NAME] Dr [NAME] [NAME] & Mrs [NAME] [NAME] [NAME] Dr [NAME] [NAME] & Mrs [NAME] [NAME] [NAME] Dr [NAME] [NAME] & Mrs [NAME] [NAME] [NAME] R [NAME] Dr [NAME] R [NAME] [NAME] & Mrs [NAME] [NAME] [NAME] S [NAME] Dr [NAME] [NAME] & Mrs [NAME] [NAME] [NAME] [NAME] & Jing Zhang & Ma [NAME] & Mrs [NAME] [NAME] [NAME] [COMPANY] [NAME] & Mrs [NAME] J [NAME] [NAME] [NAME] [NAME] [NAME] & [NAME] & Mrs [NAME] [NAME] [NAME] [NAME] & Mrs [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] & Mrs [NAME] [NAME] [NAME] & Mrs [NAME] [NAME] [NAME] [NAME] & Mrs [NAME] [NAME] [NAME] & Mrs [NAME] [NAME] [NAME] J Husband Mrs [NAME] [NAME] & Mrs [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] & Mrs [NAME] [NAME] [NAME] Miss [NAME] [NAME] & Mrs [NAME] [NAME] B [NAME] [NAME] [NAME] & Mrs [NAME] [NAME] B [NAME] Miss [NAME] [NAME] & Mrs [NAME] [NAME] [NAME] Miss [NAME] [NAME] & Mrs [NAME] [NAME] [NAME] Miss [NAME] [NAME] & Mrs [NAME] [NAME] [NAME] Miss [NAME] [NAME] & Mrs [NAME] S [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] & Mrs [NAME] [NAME] [NAME] Miss F [NAME] [NAME] [NAME] [NAME] [NAME] Miss H [NAME] [NAME] A [NAME] [NAME] [NAME] Miss [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] A [NAME] [NAME] A [NAME] [NAME] [NAME] J [NAME] Miss [NAME] [NAME] [NAME] [NAME] [NAME] Miss [NAME] [NAME] [NAME] [NAME] [NAME] Miss [NAME] [NAME] [NAME] J [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] Miss [NAME] [NAME] [NAME] [NAME] Miss [NAME] K [NAME] [NAME] [NAME] Mrs [NAME] Miss [NAME] [NAME] [NAME] Mrs [NAME] Miss [NAME] [NAME] [NAME] Mrs [NAME] Miss [NAME] T [NAME] [NAME] [NAME] Mrs [NAME] Miss [NAME] [NAME] [NAME] Mrs [NAME] Miss [NAME] [NAME] [NAME] [NAME] Mrs [NAME] Miss [NAME] [NAME] [NAME] Mrs [NAME] Miss [NAME] [NAME] [NAME] Mrs [NAME]

5 Miss [NAME] [NAME] [NAME] Mrs [NAME] Miss [NAME] [NAME] [NAME] Mrs [NAME] Miss [NAME] [NAME] [NAME] Mrs [NAME] Miss [NAME] [NAME] [NAME] Mrs [NAME] [NAME] Miss [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] N [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] S [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] J [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] R [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] K [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] & Miss [NAME] [NAME] [NAME] J [NAME] [NAME] [NAME] T [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] & K [NAME] [NAME] [NAME] [NAME] [NAME] & [NAME] [NAME] [NAME] [NAME] M [NAME] [NAME] [NAME] [NAME] [NAME] T [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] Mrs & Mrs B & [NAME] [NAME] [NAME] [NAME] [NAME] Mrs [NAME] C [NAME] [NAME] [NAME] [NAME] [NAME] Mrs [NAME] N [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] T [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] & [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] V [NAME] [NAME] [NAME] S [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] M [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] W Judge [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] Zr [COMPANY] [NAME] [NAME] M [NAME] Mrs & Miss [COMPANY] [NAME] [NAME] Mrs [NAME] Miss [NAME] [NAME] Mrs [NAME] K [NAME] Miss RL [NAME] [NAME] [NAME] J [NAME] Mrs [NAME] [NAME] & Mrs [NAME] [NAME] [NAME] Mrs [NAME] [NAME] [NAME]

6 [NAME] [NAME] [NAME] & Mrs [NAME]) [NAME] [NAME] [NAME] [NAME] [NAME] & Mrs [NAME] [NAME] [NAME] (Deceased) [NAME] [NAME] M [NAME] [NAME] & Mrs [NAME] [NAME] [NAME] [NAME] [NAME] & Mrs [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] & [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] & Miss K B & S J Roberts & [NAME] [NAME] [NAME] & [NAME] [NAME] [NAME] [NAME] & Mrs [NAME] [NAME] J [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] J [NAME] [NAME] [NAME] [NAME] & Mrs [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] L [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] & Miss [NAME] J [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] J [NAME] [NAME] & [NAME] [NAME] [NAME] [NAME] V [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] & [NAME] [NAME] [NAME] [COMPANY] [NAME] [NAME] [NAME] & Mrs [COMPANY] [NAME] [NAME] [NAME] [NAME] & [NAME] [COMPANY] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] Dr [NAME] [NAME] [NAME] K [NAME] [NAME] [NAME] Miss [NAME] [NAME] [NAME] [NAME] [NAME] Miss K [NAME] [NAME] [NAME] [NAME] [NAME] & Miss [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] & [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] & [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] & [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] & [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] & [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] A [NAME] [NAME] [NAME] & [NAME] [NAME] [NAME] [NAME] E [NAME] [NAME] [COMPANY] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [COMPANY] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] [NAME] & Mrs [NAME] & [NAME] [NAME] [NAME] D [NAME] [NAME] [COMPANY] [NAME] [NAME] [NAME] [NAME] [NAME]

[NAME] [NAME] [NAME] [NAME]

[NAME] [NAME] D [NAME] [NAME] [NAME] [NAME]

[NAME] [NAME] [NAME] [NAME] [NAME]

[NAME] [NAME] [NAME] [NAME] & [NAME]

[NAME] [NAME] J [NAME] [NAME] [RESPONDENT]

7 Appendix

Landlord and Tenant Act 1985 Section 20

(Subsections (1) and (2):)

(1) Where this section applies to any qualifying works or qualifying long term agreement, the relevant contributions of tenants are [COMPANY] in accordance with subsection (6) or (7) (or both) unless the consultation requirements have been either - (a) complied with in relation to the works or agreement, or (b) dispensed with in relation to the works or agreement by (or on appeal from) a tribunal.

(2) In this section 'relevant contribution', in relation to a tenant and any works or agreement, is the amount which he may be required under the terms of his lease to contribute (by the payment of service charges) to relevant costs incurred on carrying out the works under the agreement.

Section 20ZA

(Subsection (1))

(1) Where an application is made to a 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.