Section 20 major works and tribunal chances over unreasonable leasehold costs

[Depressedfoxi]

I’ll keep this short as possible but basically management company served a section 20 for major works costing an eye watering amount I simply cannot afford. I also can’t afford a solicitor or anything else besides tribunal. The works are needed so the building doesn’t fall down. The management company have barely maintained the building there’s no reserve funds either.

What are the chances of wining a first tier tribunal as a leaseholder taking the freeholder to tribunal for unreasonable costs if evidence is a surveyors report that states poor maintenance is a contributing factor to the works needing doing + photos. I tried to get other quotes but any company we chose didn’t have the right documents or didn’t get back to them. APPARENTLY.

The lease states they are suppose to maintain the building and of course they barely have and now the building needs all these works done to it costing hundreds of thousands.

Is this just the typical leasehold scam of pass the parcel and it’s landed on me? Is there really anything I can do? Leasehold advisory service have been useless and just give me run of the mill advice “oh yeah you could do that” WELL THANKS.

honestly at my wits end and might just have to buy a loaded ahem instead as financially my life will be over anyway.

Any advice or experience appreciated.

I’ve just been through it on the other side, as a Director of the freehold company who own our block.

Easier as everyone was share of freehold, neighbours were well off and no one had a mortgage, and it was our freehold company’s project so costs/specifications could be scrutinised every step of the way. There was no argument that the roof was failing. Five years earlier half the building had opposed the alternative of bringing in developers who wanted to add a couple of floors, so there was little obvious alternative but to pay. It was still awful. Three quarter's of neighbours who were not directors claimed not to be able to pay. We ended up retaining a lawyer right from the start to help ensure the money came in.

If it is a management company appointed by a remote freeholder, costs will have been added on at every step of the way. (I effectively donated months of my time to get the whole thing done - not that anyone has thanked me.) It is an awful position to be in.

IANAL but:

1. If you did not object during the S20 consultation it may be too late.
2. It is worth consulting https://www.lease-advice.org/
3. One option we considered should anyone not be in a position to pay, was for the freehold company to provide a loan, secured against the property, and payable on the property sale. In essence a mortgage. In our case the money would have be loaned from neighbours, probably those on the top floor whose flats suffered badly from roof leaks, and the interest required would have been modest. A commercial property company will be more hard headed, but will have seen this problem before and should be able to offer some form of solution.
4. I would also talk to your mortgage company. Especially if they offer free legal advice. If you have a mortgage they effectively own part of your asset. They will not want to see either the building collapse or your lease seized.

Good luck.This problem will be increasingly common as blocks age. I don’t think the Government’s proposals on leasehold reform will help. It is hard to think of how you raise money for major works when leaseholders themselves don’t have or be able to borrow that sort of money.

Nobody objected as we weren’t given a price of how much it would all cost. We were simply given a percentage bases of their costs in a fee proposal. Which nobody objected to as again the costs were not clear. Then once they got all the quotes they were all crazy expensive and people started complaining but not doing anything. They awarded contract now and want paying but it all seems awfully unfair as the property hasn’t been maintained now they’re hitting everyone with this big bill?

I think you could have objected at the second stage of the consultation, or have asked to get a quote from your own contractor. You are right though. At this point you have a statutory duty to pay or risk forfeiting your flat. Your best bet is to negotiate some form of loan (probably secured) or a payment plan

Costs have gone through the roof
We managed our project, picking our surveyor and asked for quotes from five contractors including two we suggested. Only 2 quoted. One of our contractors had to give up when a subcontractor dropped out. Prices were almost double what we had expected.

You will be far from alone. It is hard to see how major works can be afforded, unless we follow a European model and have obligatory, and large, contributions to sinking funds.

Do contact the leasehold advisory service. They are a lot more expert.

OP stated clearly in her first post that she already has spoken to the leasehold advisory service.

I'm not a lawyer but some do look on this board so hopefully you will get an answer from somebody who knows the law.

It sounds to me as if your best bet is to see what the freeholder is responsible for. If they have neglected their responsibilities, then you may have some recourse there

There are some astonishing leases around though - I always had a look before buying because some freeholders seem to have no responsibilities at all!

I don't really understand what you've said about being given a fee percentage

When did the final cost come through? How much notice have you been given to pay it? Is there an option for a payment plan?

I know someone who was in a block where they all had to pay £11,000 for roof replacement. Obviously, nobody had that pay upfront so a payment plan was negotiated over about two years I think.