Section 20 of the Landlord and Tenant Act 1985, as amended by the Commonhold and Leasehold Reform Act 2002, requires landlords, freeholders, and managing agents to consult leaseholders before carrying out qualifying works where any leaseholder's contribution would exceed �250. Non-compliance limits recovery to �250 per leaseholder regardless of actual cost.
What triggers Section 20?
Any works on a building or its common parts where the costs are recoverable via service charges and any single leaseholder's share exceeds �250. Emergency works are exempt but the landlord must apply to the First-tier Tribunal for retrospective dispensation.
Stage 1: Notice of Intention (30 days)
Serve a written Notice of Intention on all leaseholders and any recognised tenants' association. The notice must describe the proposed works, explain why they are necessary, and invite: (1) written observations within 30 days, and (2) nomination of a contractor to be invited to tender within 30 days.
Stage 2: Notification of Estimates (30 days)
After the Stage 1 observation period, obtain at least two competitive estimates (including any nominated contractor). Circulate a notice summarising Stage 1 observations and listing all estimates. Invite further written observations within 30 days.
Stage 3: Notice of Reasons (if needed)
If you award the contract to a contractor who was neither the lowest-priced nor a leaseholder-nominated contractor, serve a written notice of reasons within 21 days of contract award.
The �250 penalty for non-compliance
Miss any required stage or observation period and you lose the right to recover more than �250 per leaseholder from the service charge for those works. Leaseholders raise this as a defence in First-tier Tribunal service charge applications. Apply for dispensation to the Tribunal if emergency works have been carried out without consultation.