Jefferson Place, 1 Fernie Street, Manchester, M4 4AZ ((Leasehold) disputes (management) - Service charges)

Factual and Procedural Background

The Applicant, Company A, landlord of an 18-storey residential block comprising 309 apartments at The Property, submitted an application to the First-tier Tribunal seeking dispensation from the consultation requirements imposed by Section 20 of the Landlord and Tenant Act 1985. The works concerned remedial measures to the Property’s external cladding system, which was found to be constructed of combustible materials posing a fire risk. The proposed remedial works include replacement and installation of render, spandrel panels, metal cladding, insulation, fire safety barriers, vents, signage, and other associated fitments.

The application was filed on 7 July 2021, with directions issued on 11 February 2022 allowing for objections and determination without a hearing. One formal objection was received from a leaseholder. The Applicant had registered the Property with the Government Building Safety Fund but faced uncertainty regarding funding eligibility for certain elements of the works. The Applicant chose a Design and Build procurement route and obtained tenders, selecting the most cost-efficient quote. The Applicant argued that compliance with the consultation requirements was impracticable due to the funding method, procurement approach, and urgency of the works. Updates were provided to the Respondents via an online portal and resident meetings.

Legal Issues Presented

1. Whether the Tribunal should grant dispensation from the consultation requirements under Section 20 of the Landlord and Tenant Act 1985 pursuant to Section 20ZA, given the urgency and nature of the remedial works at the Property.
2. Whether it is reasonable to dispense with the consultation requirements in circumstances where compliance would be impracticable and could jeopardise government funding.

Arguments of the Parties

Applicant's Arguments

• The remedial works are necessary and urgent to address fire safety risks posed by combustible cladding materials.
• Compliance with the consultation requirements is impracticable due to the Design and Build procurement method and uncertainty over government funding.
• Dispensation would not financially prejudice the Respondents; conversely, requiring consultation could risk loss of government funding and increased costs.
• The Applicant has kept Respondents informed through an online portal and resident meetings.
• The conditional objection by a Respondent requesting detailed plans, procurement evidence, security measures, and communication assurances was unreasonable.

Respondents' Arguments

• One Respondent objected conditionally, expressing concern that uncertainty over government funding eligibility for certain works (notably the white render) could result in additional costs not subject to consultation.
• The objection requested specific assurances regarding the timing and sequencing of works, procurement and delivery schedules, building security during works, and maintenance of communication facilities for residents.

Table of Precedents Cited

No precedents were cited in the provided opinion.

Court's Reasoning and Analysis

The Tribunal exercised its discretion under Section 20ZA of the Landlord and Tenant Act 1985, which permits dispensation from consultation requirements if the Tribunal is satisfied that it is reasonable to do so. The Tribunal accepted the submissions that the works were necessary and urgent, and that compliance with the consultation requirements was impracticable given the funding and procurement context. The Tribunal considered the objection but found no prejudice to the Respondents arising from the failure to carry out consultation. The Tribunal also noted that the dispensation does not affect the Respondents’ rights to challenge the reasonableness or payability of service charges under separate statutory provisions.

Holding and Implications

The Tribunal GRANTED the application for dispensation from the consultation requirements imposed by Section 20 of the Landlord and Tenant Act 1985 in respect of the remedial works at the Property.

The direct effect is that the Applicant may proceed with the urgent remedial works without fulfilling the usual consultation obligations. The decision does not establish new legal precedent and leaves open the Respondents’ ability to challenge service charge reasonableness or payability through other statutory procedures.