Section 20 Consultation: A Guide for Leaseholders
A plain-English guide to the section 20 consultation process under the Landlord and Tenant Act 1985. Understand the three stages of section 20, your rights if you receive a section 20 notice, what happens if you want to challenge the charges, and when section 20 dispensation applies. Whether you are facing section 20 major works on your block or are buying a flat with section 20 notice, this guide covers everything you need to know.
What Is Section 20?
Section 20 of the Landlord and Tenant Act 1985 is the statutory provision that requires landlords and managing agents to consult with leaseholders before carrying out qualifying works or entering into a qualifying long term agreement where the cost to any individual leaseholder exceeds two hundred and fifty pounds. The provision was substantially amended by section 151 of the Commonhold and Leasehold Reform Act 2002 and is supplemented by the Service Charges (Consultation Requirements) (England) Regulations 2003.
The purpose of the section 20 consultation process is to ensure that leaseholders are informed about proposed major works, have the opportunity to make observations, and can nominate alternative contractors before costs are committed. It is one of the most important protections available to leaseholders under section 20 landlord and tenant act 1985 legislation, and failure to comply has significant financial consequences for the landlord.
If the landlord fails to follow the correct section 20 consultation procedure, the maximum amount recoverable from each leaseholder for the qualifying works is capped at two hundred and fifty pounds, regardless of the actual cost of the works. This makes full compliance essential for any freeholder or managing agent planning section 20 major works. For details of our consultation management service, visit our section 20 consultation service page.
The Three Stages of Section 20 Consultation
The section 20 consultation process follows a structured section 20 consultation flowchart of three distinct stages. Each stage has mandatory requirements and minimum timescales that must be observed. Failing to complete any stage correctly can invalidate the entire consultation.
Stage 1: Notice of Intention
The landlord serves a written notice on every leaseholder describing the proposed works, explaining why they are considered necessary, and inviting written observations within a minimum period of 30 days. Leaseholders are also invited to nominate a contractor from whom the landlord must obtain an estimate.
- Must describe the proposed works and the reasons for them
- Minimum 30-day observation period for leaseholder responses
- Leaseholders may nominate a contractor for inclusion in the tender
Stage 2: Statement of Estimates
After considering any observations from Stage 1 and obtaining at least two estimates (including from any leaseholder-nominated contractor), the landlord provides a summary of the estimates to all leaseholders. This is the section 20 notice stage where leaseholders can see the proposed section 20 notice costs and make further written observations within another minimum 30-day period.
- At least two estimates must be obtained and summarised
- Any leaseholder-nominated contractor must be included
- Another minimum 30-day observation period applies
Stage 3: Notice of Reasons
If the landlord does not select the lowest estimate or does not appoint a leaseholder-nominated contractor, a Notice of Reasons must be served within 21 days of entering into the contract. This notice explains why the chosen contractor was selected and summarises any observations received at Stage 2, together with the landlord's response to those observations.
- Required if the lowest estimate or nominated contractor is not chosen
- Must be served within 21 days of entering into the contract
- Must include a summary of observations received and the landlord's response
For professional management of the entire consultation process, including preparation of compliant section 20 notice template documents, see our section 20 consultation service. We also manage the procurement and tendering process through our major works service.
When Is Section 20 Required?
The section 20 consultation requirement is triggered in two situations: when the landlord proposes to carry out qualifying works where the cost to any individual leaseholder exceeds two hundred and fifty pounds, or when the landlord proposes to enter into a qualifying long term agreement where the annual cost to any individual leaseholder exceeds one hundred pounds. Understanding these thresholds is essential for managing agents and freeholders to avoid the financial cap that applies when consultation is not properly carried out.
Qualifying Works (Major Works)
Section 20 major works include any building works where the contribution from any one leaseholder would exceed two hundred and fifty pounds. Common examples include roof repairs, external decoration, window replacement, lift refurbishment, and structural repairs. The threshold applies per leaseholder, not per building.
- Threshold: over 250 pounds per leaseholder
- Full three-stage consultation required
Qualifying Long Term Agreements
A qualifying long term agreement is a contract for services lasting more than twelve months where the annual cost to any leaseholder exceeds one hundred pounds. Examples include long-term cleaning contracts, lift maintenance agreements, grounds maintenance contracts, and building insurance arrangements.
- Threshold: over 100 pounds per leaseholder per year
- Applies to contracts exceeding 12 months in duration
If you are buying a flat with section 20 notice, it is important to check whether the consultation has been completed, whether any works are pending, and what your potential liability will be. Your conveyancing solicitor should request full details of any outstanding or upcoming section 20 works as part of the service charge management enquiries. Understanding the status of any section 20 notice costs is essential before exchanging contracts.
Can You Refuse to Pay a Section 20 Charge?
Section 20 refusal to pay is one of the most common concerns among leaseholders who receive a large service charge demand following major works. The short answer is that you cannot simply refuse to pay if the consultation was correctly followed and the charges are reasonable. However, you do have important rights that protect you from unfair or excessive demands.
If you believe the section 20 consultation process was not followed correctly, or that the costs are unreasonable, you have the right to apply to the First-tier Tribunal for a determination. The tribunal can assess whether the consultation requirements were met, whether the costs were reasonably incurred, and whether the works were carried out to a reasonable standard. If the consultation was not properly conducted, your liability may be limited to two hundred and fifty pounds.
Review the Consultation Documents
Request copies of all three stages of the section 20 consultation, including the Notice of Intention, Statement of Estimates, and Notice of Reasons. Check that each stage was completed with the correct timescales and content.
Challenge Reasonableness
Even where the consultation was correctly followed, you can challenge whether the costs were reasonably incurred. Request invoices and compare the costs against market rates for similar works.
Apply to the First-tier Tribunal
Under Section 27A of the Landlord and Tenant Act 1985, you can apply to the tribunal for a determination on any aspect of the service charge, including section 20 works. The tribunal can reduce or disallow charges.
Know the Risks of Non-Payment
Simply refusing to pay without a tribunal application can lead to county court proceedings, a judgment against you, and potential forfeiture action. Always seek a formal determination rather than withholding payment unilaterally.
For more detail on the dispute process, see our service charge dispute guide and our overview of leaseholder rights.
Section 20 Dispensation
Section 20 dispensation allows a landlord to apply to the First-tier Tribunal for permission to dispense with some or all of the consultation requirements. This is provided for under Section 20ZA of the Landlord and Tenant Act 1985 and is typically used where emergency works are needed and there is insufficient time to complete the full three-stage process without risking further damage or danger to the building and its residents.
Common scenarios where section 20 dispensation may be sought include emergency roof repairs following storm damage, urgent structural works to prevent further deterioration, essential health and safety works that cannot wait for the consultation timescales, and situations where the landlord inadvertently failed to consult but the works have already been carried out at a reasonable cost. The tribunal will grant dispensation only if it is satisfied that it is reasonable to do so in all the circumstances.
Importantly, the grant of dispensation does not prevent leaseholders from challenging the reasonableness of the costs themselves. Dispensation only removes the consultation requirement; the charges must still be reasonably incurred and the works must still be of a reasonable standard. Leaseholders retain their full rights under Section 19 and Section 27A of the Act.
When Dispensation Is Granted
- Genuine emergency requiring immediate works
- Health and safety risk that cannot wait for consultation
- No significant prejudice to leaseholders
What Dispensation Does Not Do
- Does not remove the right to challenge costs at tribunal
- Does not confirm the charges are reasonable
- Does not waive the requirement for reasonable costs and standards
Frequently Asked Questions About Section 20
Can I refuse to pay a section 20?
You cannot simply refuse to pay a section 20 charge if the consultation process has been correctly followed and the costs are reasonable. However, if the landlord or managing agent failed to follow the three stages of the section 20 consultation process, your liability may be capped at two hundred and fifty pounds per qualifying item of work. If you believe the charges are unreasonable or the process was flawed, you can apply to the First-tier Tribunal for a determination before paying. Withholding payment without a tribunal application risks debt recovery action and potential county court proceedings.
How long does it take to do a section 20?
A full section 20 consultation process typically takes between three and six months to complete, depending on the complexity of the works and the number of leaseholders involved. Each of the three stages requires a minimum 30-day observation period during which leaseholders can respond. The Notice of Intention stage takes at least 30 days, followed by the procurement and estimation period, then the Statement of Estimates stage requires another 30 days, and finally the Notice of Reasons must be issued before works begin. Delays can occur if leaseholders nominate contractors or if additional tenders are required.
What are the three stages of Section 20?
The three stages of the section 20 consultation process are: Stage 1, the Notice of Intention, where the landlord notifies leaseholders of the proposed works and invites them to make observations and nominate contractors; Stage 2, the Statement of Estimates, where the landlord obtains at least two estimates (including from any leaseholder-nominated contractor), provides a summary to all leaseholders, and invites further observations for a minimum of 30 days; and Stage 3, the Notice of Reasons, where the landlord notifies leaseholders of the chosen contractor and provides written reasons if the selected contractor did not submit the lowest estimate or was not nominated by a leaseholder.
What should a Section 20 Notice include?
A section 20 notice must include a clear description of the proposed works or the qualifying long term agreement, the reasons why the works are considered necessary, an invitation for leaseholders to make written observations within a minimum 30-day period, and details of how and where observations should be sent. At the Statement of Estimates stage, the notice must include a summary of at least two estimates obtained, the name and address of each contractor, and a statement that observations are invited within 30 days. The notice must also inform leaseholders of their right to nominate a contractor at Stage 1.
Does a section 20 go to court?
Section 20 disputes are not usually dealt with in the county court or High Court. Instead, they are determined by the First-tier Tribunal (Property Chamber), which is the specialist body for residential leasehold disputes. Leaseholders can apply to the tribunal to challenge the reasonableness of charges arising from section 20 major works, or to argue that the consultation process was not properly followed. The landlord can also apply to the tribunal for section 20 dispensation if the full consultation process cannot be completed. Tribunal fees are modest and each party typically bears their own costs.
What does section 20 mean in law?
Section 20 of the Landlord and Tenant Act 1985, as substituted by section 151 of the Commonhold and Leasehold Reform Act 2002, imposes a statutory consultation requirement on landlords before they carry out qualifying works or enter into a qualifying long term agreement where the cost to any leaseholder exceeds two hundred and fifty pounds. The provision is designed to protect leaseholders from paying for major works or long-term contracts without being informed, consulted, and given the opportunity to make observations or nominate alternative contractors. Failure to comply with section 20 limits the amount recoverable from each leaseholder to two hundred and fifty pounds.
Expert Section 20 Consultation Management
Whether you are a freeholder planning section 20 major works, a director of a residents' management company needing guidance on the consultation process, or a leaseholder who wants to understand a section 20 notice you have received, Block is here to help. Our section 20 consultation service ensures full compliance with the Landlord and Tenant Act 1985 at every stage.