Repairs to Property – Freeholders Beware!
Any owner of a building will know that sooner or later that building will need repairs. Those repairs can be expensive, especially in the case of buildings containing several flats or apartments.
In most cases the leases on which such flats are normally held will make the freeholder responsible for repairs to the fabric of the building and the common parts and allow the freeholder to recover the costs from the leaseholders through a service charge.
As these can be significant sums of money, the law in England and Wales (Scottish law is outside the scope of this article), limits the amount that each leaseholder can be required to pay unless specific procedures have been followed by the freeholder.
Where the amount any leaseholder should pay exceeds £250, the landlord must write to the leaseholders and any recognised tenants’ association (‘RTA’):
- setting out what works the landlord intends to have carried out or where a description can be viewed;
- setting out why the landlord considers those works should be done;
- inviting written observations and provide an address and a date by which to reply; and
- inviting nominations for any organisations or tradespeople from whom estimates should be obtained.
The landlord must allow at least 30 days for responses
The landlord must then obtain at least two estimates in writing.
At least one of those estimates must be from someone not connected to the landlord and the landlord must obtain estimates from anyone nominated by the leaseholders or RTA.
The landlord must then prepare a statement based on at least two of the obtained estimates setting out the estimated costs and a summary of any observations received and the landlord’s response.
Any estimate obtained from contractors nominated by the tenants or RTA must be included in that statement.
The statement must be sent to the tenants and the secretary of any RTA together with a notice setting out where and when all estimates can be inspected and inviting written observations. It must also specify where any responses are to be sent and when by. That date must be at least 30 days from the date of the notice.
The landlord is required to consider, summarise and respond to any observations made.
Enter into contract
The landlord can now enter into the contract to undertake the works but unless the contractor is one of those nominated by the tenants or the RTA or is the lowest bidder, the landlord is required to serve a further notice within 21 days of entering into the contract setting out the reasons for its choice or where those reasons can be inspected.
Failure to comply
The purpose of the legislation is to ensure that tenants do not have to pay for works that are unreasonable or to pay more than reasonable.
If the landlord does not comply with these requirements, they may not be able to recover more than the statutory amount from each tenant!
It is possible to apply to a tribunal for a dispensation from the consultation requirements but that should not be relied on.
If you are a landlord of a building that requires repairs with long lease holding tenants or are a tenant facing a demand to pay a service charge, you should take legal advice.
Contact us on 01227 813400 or fill out our enquiry form here: https://www.gardnercroft.co.uk/contact
This literature is intended purely as an overview of this topic and does not constitute legal advice.