Pictured above: David Hollingworth
Law firm warns that failure to consult tenants over works can
mean landlord has to carry cost.
Following a recent Court of Appeal, local law firm Andrew &
Co LLP is warning landlords who fail to consult with flat owners
before carrying out works that they cannot expect help from the
courts if the tenants refuse to contribute to the expense.
This was the decision of the Court of Appeal, in the case of
Daejan Investments Ltd v Benson and Others.
Partner David Hollingworth of Andrew & Co LLP says: "Where
flats are sold on long leases, there is always a clause that says
tenants must contribute towards the cost of maintaining and
repairing the building.
"For leases granted after 31 October 2003, regulations under the
Landlord and Tenant Act 1985 say landlords must consult with
tenants about works they propose to carry out. If the
landlord fails to consult, he can recover only a limited amount
from each tenant," warns David.
He says that in these circumstances, the landlord's only hope is
to ask the Leasehold Valuation Tribunal to order that the
requirement to consult should be dispensed with, which the Tribunal
may do if it is satisfied that to do so is reasonable.
In the Daejan case, the landlord conducted major works to the
building at a cost of £270,000. The tenants refused to
contribute on the grounds that the landlord had not consulted them
properly.
Daejan Investments then asked the Leasehold Valuation Tribunal
for an order to dispense with the need for consultation, but the
Tribunal refused saying that it had no power to do so solely
because of the financial consequences for the landlord. The Court
of Appeal upheld that decision.
David says: "This case is a stark reminder of the perils of not
taking professional advice. Here, the landlord incurred
expenses of £270,000 on the building work and was only
allowed to recover £250 from each of the five tenants.
Landlords need to check where they stand and undertake the
necessary consultation before embarking on any work, whether it's
small fry or a major investment such as this."
Landlords wishing to discuss such issues can contact David on
01636 673743