Section 20 consultations

By law, we must consult leaseholders before carrying out works or entering into a long-term agreement with a contractor which exceed certain values.

This is often called ‘Section 20 consultation’ because it was introduced by Section 20 of the Landlord and Tenant Act 1985 (as amended by S151 Commonhold and Leasehold Reform Act 2002).

The consultation process which must be followed varies depending on the circumstances.  These are detailed within The Service Charges (Consultation Requirements) (England) Regulations 2003.

Under the terms of your lease, you must pay towards the cost of any services or work we undertake in fulfilling the obligations placed upon us. This may be via your service charge, a one-off invoice for major works or through monies held in a reserve fund (where applicable).

Under section 20 of the Landlord and Tenant Act 1985 (amended by section 151 of the Commonhold and Leasehold Reform Act 2002), we must consult you about some of the work and services that you pay for.

We must consult you before we do any of the following:

• Carry out work which will cost any one leaseholder more than £250. This includes repairs, maintenance and improvements
• Enter into a long-term agreement for more than 12 months with contractors for work, supplies or services which will cost any one leaseholder more than £100 per year, such as window cleaning, grounds maintenance or lift servicing
• Carry out work under an existing long-term agreement where the work will cost any one leaseholder more than £250

We do not have to consult with you under Section 20 on any repairs costing less than £250 per leaseholder. In these cases, repayments are included in your annual service charge.

We understand that planned works can have a financial impact on leaseholders, so have developed a consultation process specifically for large projects, which goes beyond the legal requirements of Section 20. To learn more about our planned works process, take a look at our guide.

In some cases, where work is needed urgently, we may not be able to consult with you under Section 20. We will let you know if this is the case and will share as much information as we can.

In some cases, the best way to deliver a project may be through a long-term agreement. This is an agreement for a fixed number of years with a specific contractor or contractors.

The advantage of a long-term agreement is that we will be working with a contractor over a long period and building a relationship with them.

By collecting data about the outcomes of each project, we can continually monitor the quality of our contractor’s work. We are also able to ensure that the methods employed by the contractor to deliver the work and achieve high levels of satisfaction.

In most cases, you will receive two or three notices at different stages of the process, depending on the type of consultation.

1st notice – intention

In this notice, we will inform you that we intend to carry out work or provide a service that you will need to pay for and why. You’ll receive this notice before we invite contractors to tender for the work or services. This is known as the tender process.

2nd notice – statement of estimates

In this notice, we will provide details of at least two cost estimates from contractors and confirm which one we propose to award the contract to. You’ll receive this notice once the tender process is complete.

3rd notice – award of contract/notice of reasons

In this notice, we will confirm that we have awarded the contract to one of the contractors specified in the 2nd notice. If we don’t appoint the contractor who has submitted the lowest estimate or one which hasn’t been nominated by a leaseholder or Residents Association, we will serve a Notice of Reasons.  This notice will explain the reasons for the choice of contractor.

Please note, we will not issue a 3rd notice if it is a public notice.

After the final notice has been served, we will award the works or contract to the successful contractor and commence the work as appropriate.

Notice of intention to carry out work under a long-term agreement

If we have already carried out a consultation and entered into a long-term agreement to carry out cyclical work such as painting works, you will only receive one notice.

In this notice, we will inform you that we intend to carry out work or provide a service under an existing agreement as well as including a cost estimate. You’ll receive this notice after we have consulted with you about entering into the long-term agreement.

You have the right to give us your views and comments following the 1st and 2nd Notice. These are referred to as observations. Observations must be about the proposed work, for example, you might want clarity on the exact specification of work or the duration of the contract.

Observations must be made in writing within 30 days of the notice being issued. Information on how to make observations and the appropriate deadlines will be included in each notice. When we receive your observations, we will carefully consider your views, comments and suggestions and will provide our response in the next notice we issue.

In some cases, you may be able to suggest a contractor who you would like to tender for the work or long-term agreement, this is known as nominating a contractor. If the value of a contract makes it subject to a public notice, you will not be able to nominate a contractor.

Whether you are able to nominate a contractor or not will be specified in the 1st notice you receive. If you are able to nominate a contractor, you should give us their details in writing during the consultation period as stated in the notice. There are certain conditions that contractors will need to meet in order to be awarded a contract for the works, for example:

• Public and employers liability insurance
• Health and safety policies and procedures
• Technical/professional accreditations and evidence of experience
• Company trading information such as VAT numbers

We will consider your nomination together with any others we receive. If we receive more than one nomination, we must choose the contractor who had the most nominations. We will then invite them to tender for the works/contract where appropriate alongside the contractors we are inviting to tender.

In the 2nd notice you receive, we will confirm which contractor we propose to award the contract to.

Contracts of a certain value must be published via the find a tender service as required by the Government’s procurement rules. If a public notice is required, you will not be able to nominate a contractor, and this will be made clear in the 1st notice you receive.

Please note, any contractor can access the find a tender service to submit a bid, regardless of whether they have been nominated by a leaseholder.

To learn more about paying for the work taking place, take a look at our guide.

If you’d like to give feedback whilst the work is taking place, you can get in touch by emailing section20@onward.co.uk.

At the end of each project, we also carry out a satisfaction survey so you can tell us how you feel about the work that has been done. We review the results carefully to understand how we can improve in the future.

In some cases, you may be invited to attend a meeting towards the end of the project, so you can raise any questions or concerns about the quality of the work. This will happen before the project is signed off, so we can ensure you are satisfied. If you are dissatisfied with any aspect of the work, contract management or delivery, we will work with you and aim to respond to queries and disputes within four weeks.

From time-to-time, we may not be able to resolve some of the issues raised. If you are unhappy with our responses in relation to disputes, we will explore mediation. You can also refer a dispute to a First-Tier Tribunal (Property Chambers) or arbitration panel. A tribunal or panel may include fees, and you will be responsible for covering your own costs. Any decision made by a tribunal or panel will be legally binding.

Further information about First-Tier Tribunal (Property Chambers) can be found by visiting the Government’s website, emailing rpnorthern@justice.gov.uk or calling 0161 237 9491.