Section 20 notices – popular questions answered

If you hear a managing agent talk about ‘Section 20’ they will be referring to Section 20 of the Landlord and Tenant Act 1985 as amended by the Commonhold and Leasehold Reform Act (CLRA) 2002. This may sound daunting, but the act was brought in to provide protection to residential leaseholders so they may be duly consulted on any works which would eventually cost them more than £250, and to let their opinion be heard and accounted for. If a landlord fails to carry out the required consultation process associated with conducting major works, a leaseholder will only be required to pay £250 towards the works, whatever the costs may be. Whether you are a landlord or a leaseholder, it is important to understand Section 20 notices, so you understand your rights and obligations.

In this article, we answer some of the most common queries around Section 20 notices.

What are Section 20 notices and when are they issued?

A Section 20 (S20) notice is a notice issued by landlords to inform affected leaseholders of the intention of any major work planned at the building, or any service provided to leaseholders who will be required to pay towards the associated cost.

Major works typically include things like essential repairs, decoration, improvements, or refurbishments. They do not include things like internal decoration of a flat. Services offered are likely to be things like cleaning and grounds maintenance, or regular servicing of equipment (lift/fire alarm etc).

A S20 must be served on any leaseholder who will be affected by the planned work or who will be receiving the proposed service. A S20 consultation is necessary when the cost is more than £250 per home and it is also a leaseholder’s opportunity to give your opinion on the proposed plans.

Typically, a Section 20 notice will explain what work/service is planned, why it is being carried out, and the anticipated costs.

What is the Section 20 consultation process?

Leaseholders have a right to be consulted if the landlord carries out major works or provides services for which they will be asked to pay towards. The Section 20 consultation process consists of three stages:

First stage – a notice of intention for works is served by landlords to leaseholders. As mentioned above, this will contain a description in general terms of the works proposed, as well as the reasons for the proposed works. It should also invite the leaseholder to give their opinions (observations) in writing within 30 days. Where applicable, it may also inform leaseholders of their right to nominate a contractor to be contacted by the landlord for an estimated costing of the works outlined.

Second stage – notification of estimates. A second notice for major works (Notice of Estimates) must be issued by the landlord to each leaseholder and the recognised tenants association (if there is one). It will include details of at least two estimates that the landlord has obtained. One of the estimates should be from a contractor wholly unconnected with the landlord. As stated previously, the landlord must invite observations in writing within 30 days and rust have regard to any observations received.

Third stage – where applicable, notification of the award of contract is shared. This will be given within 21 days of entering the contract and should contain the reasons for the award of the contract and give a summary of the leaseholder’s observations regarding the estimates. However, this notice will not be required if the contract has been awarded to a contractor nominated by a leaseholder or RTA, or if the contract has been awarded to the contractor with the lowest quote.

Can leaseholders object to a Section 20 notice?

Yes, the S20 notice is not just issued to inform leaseholders of works, it also initiates the start of a minimum of 30 days consultation process whereby leaseholders and RTAs can ask questions, make ‘observations’, and object to the planned works or services outlined in the notice.

The notice should explain how leaseholders can make their observations and objections, but whether this be via post, email or by using an online form, they must be made in writing. Otherwise, they are unlikely to be formally recorded.

Any observations submitted to the landlord in writing must be sufficiently regarded and replies to observations should be given when the consultation progresses to stage two.

What are considered major works under Section 20?

Major works can be any substantial repair, redecoration, replacement, or improvement made to your building, estate, or the area surrounding your building. Examples include:

  • Renewing/replacing windows or window frames
  • Lift renewal
  • New entry doors
  • Roof/gutter repairs or renewal
  • Decorating or repairing of communal areas

All leaseholders are required to contribute towards the cost of major works carried out, but if the cost of the planned work is estimated to cost over £250 per flat or if the landlord wants to enter into a long-term agreement (more than 12 months) which may cost leaseholders more than £100 in any one year, they are legally required to consult with leaseholders before commencing (Section 20 Consultation).

How many quotes do you need for a Section 20?

The notice of estimates issued by the landlord needs to include at least two quotes for the proposed work (one estimate needs to be independent of the landlord or managing agent). The notice of estimates should also include any comments/observations from the first notice of intent, as well as details of where the specification and quotations can be reviewed by leaseholders.

Does Section 20 apply to freeholders?

Yes, Section 20 law views landlords, freeholders, Right to Manage Companies, Resident’s Management Companies, and any other management company that has responsibility for the freehold as “landlords”. Therefore, if you are a freeholder and want to carry out major works to repair, maintain or improve a property which will cost each leaseholder more than £250, you must follow Section 20 procedures, starting with a Section 20 notice.

If you are a landlord, director of a Residents Association or Right To Manage Company, self-managing a residential block, we understand how daunting the process can seem. The team at Jennings & Barrett would be happy to share our expertise with you to ensure you get Section 20 works right.