13 August, 2020
We've previously reported on cases demonstrating how costly it can be for landlords who don't follow the section 20 Landlord and Tenant Act 1985 consultation requirements. If not done, landlords can only recover £250 per leaseholder towards the works, unless the First-Tier Tribunal grants dispensation.
The leading case of Daejan Properties Ltd v Benson (2013) UKSC 14 found there is a presumption that dispensation will be given unless the leaseholders can establish some actual prejudice (ie, that the consultation would have likely resulted in a change to the scope, quality or costs of the proposed works).
Aster Communities v Chapman & Ors was an appeal to the Upper Tribunal concerning asphalt works to balconies. The landlord, Aster, had carried out section 20 consultation but not included the asphalt works in the consultation. Aster applied for dispensation.
The leaseholders argued at the First-Tier Tribunal that Aster had provided no evidence of the asphalt works being necessary. In addition, the leaseholders argued they had been prejudiced by not having the opportunity to object to the works and obtain expert evidence.
The FTT had granted dispensation on condition that Aster pay:
Aster appealed to the UT, arguing it was for the leaseholders to instruct an expert and show prejudice, and then for Aster to rebut that with evidence.
The Upper Tribunal did not agree with Aster. It was held that expecting the lessees to instruct a surveyor as a precursor to the application was unrealistic. The landlord had failed to consult with the leaseholders adequately before doing the works to balconies and there was, to say the least, a "credible case of prejudice". That prejudice could most effectively be remedied by the lessees instructing their expert to conduct a survey of the balconies throughout the main blocks. That would place the lessees in the position they would have been in if there had been proper consultation. The UT found that the FTT had had good reasons for imposing the conditions that it did and dismissed Aster's appeal.
This decision demonstrates that where there is dispute over the necessity of works, dispensation won't be a mere formality and a landlord might be required to pay the costs of expert opinion.
Eagle eyed readers might have noticed this isn't the first time we have commented on Aster Communities seeking dispensation for asphalt works. Very similar facts applied in Aster Communities v Kerry Chapman & Ors  UKUT 177 (LC), where the same decision to grant dispensation with conditions of paying the lessee's costs was made by the FTT and upheld by the UTT. Hopefully Aster will get it right next time!
For more information contact Emily Jordan in our Housing & Regeneration department via email or phone on 01257 240850. Alternatively send any question through to Forbes Solicitors via our online Contact Form.