Section 20 Consultation and Major Works
Expert management of the Section 20 consultation process for qualifying works and long-term agreements. We ensure full statutory compliance, protect your ability to recover costs through the service charge, and keep leaseholders informed at every stage.
What Is a Section 20 Consultation?
Section 20 of the Landlord and Tenant Act 1985 establishes a statutory consultation process that must be followed before a landlord or managing agent can carry out qualifying works or enter into qualifying long-term agreements where the cost to any individual leaseholder exceeds a prescribed threshold. This section 20 consultation process is one of the most important protections available to leaseholders, ensuring they have a genuine opportunity to be consulted before significant expenditure is incurred on their behalf.
For qualifying works, such as section 20 major works including roof repairs, external redecoration, or structural improvements, the threshold is 250 pounds per leaseholder. For qualifying long-term agreements exceeding 12 months, such as cleaning contracts, lift maintenance agreements, or security services, the threshold is 100 pounds per leaseholder per year.
The Landlord and Tenant Act 1985 requirements are detailed and prescriptive. Failure to comply with the consultation process limits the amount that can be recovered from each leaseholder to the relevant threshold, regardless of the actual cost of the works. This makes strict compliance essential for any freeholder, residents management company, or right to manage company undertaking significant expenditure.
At Block, we have managed over 80 Section 20 consultation processes without a single successful tribunal challenge. Our expertise ensures that every procedural requirement is met, every deadline is observed, and every leaseholder is properly consulted throughout the process.
The Three Stages of Section 20 Consultation
The Section 20 consultation process for qualifying works follows three distinct stages, each with specific requirements that must be observed precisely. Here is a detailed breakdown of how the process works in practice.
Stage 1: Notice of Intention
The first stage requires the landlord or managing agent to serve a written notice of intention on every leaseholder, describing the proposed works in general terms and explaining the reasons why they are considered necessary. The notice must invite leaseholders to make written observations about the proposed works within a period of at least 30 days.
The notice must also invite leaseholders to nominate contractors from whom the landlord should seek estimates. This right to nominate gives leaseholders a genuine say in the procurement process and helps ensure competitive pricing. All leaseholder observations received during this period must be given due regard before proceeding to the next stage.
- •Describe the proposed works and the reason they are necessary
- •Allow a minimum of 30 days for written observations
- •Invite leaseholders to nominate contractors
- •Have regard to all observations received
Stage 2: Notification of Estimates
After the Stage 1 observation period closes, the landlord must obtain at least two estimates for the proposed works, one of which should be from a contractor wholly unconnected to the landlord. If any leaseholder nominated a contractor during Stage 1, an estimate must be sought from that contractor as well.
A statement summarising the estimates, including all leaseholder-nominated contractor estimates, must then be served on every leaseholder or made available for inspection. Leaseholders are given a further 30-day period to make written observations on the estimates and the proposed expenditure.
- •Obtain at least two estimates, including from any nominated contractors
- •At least one estimate must be from an unconnected contractor
- •Provide a summary of all estimates to leaseholders
- •Allow a further 30 days for written observations
Stage 3: Notification of Award
If the landlord does not select the lowest estimate, or does not select a leaseholder-nominated contractor, a further notice must be served on the leaseholders within 21 days of entering into the contract. This notice must explain the reasons for the selection and summarise any observations received at Stage 2 along with the landlord response to those observations.
Once Stage 3 is complete, the consultation process is concluded, and the works can proceed with the full cost recoverable through the service charge. Throughout all three stages, meticulous record-keeping is essential to demonstrate compliance if the process is ever challenged.
Section 20 Timelines and Planning
Proper planning is essential for any section 20 major works project. The statutory consultation periods alone require a minimum of two to three months, and when combined with the time needed to prepare specifications, obtain estimates, evaluate tenders, and arrange for works to begin, the total project timeline from initial decision to works completion is typically six to twelve months for straightforward projects and twelve to eighteen months for complex major works schemes.
We recommend that building managers begin planning for major works well in advance. This allows sufficient time for building condition surveys to identify the scope of works, detailed specifications to be prepared by qualified surveyors or architects, the full Section 20 consultation process to be completed without rushing, competitive tenders to be obtained and properly evaluated, and works to be scheduled during optimal conditions, particularly for external works that are weather-dependent.
For emergency repairs where the normal consultation process cannot be completed in time, it is possible to apply to the First-tier Tribunal for dispensation from the consultation requirements. However, dispensation is not guaranteed, and the tribunal will consider whether leaseholders have been prejudiced by the failure to consult. Our advice is always to plan ahead and avoid the need for dispensation wherever possible.
Our building maintenance team works closely with our Section 20 specialists to ensure that planned building maintenance programmes are coordinated with the consultation timetable, avoiding last-minute rushes and ensuring leaseholders are given proper opportunity to participate in the process.
Leaseholder Rights Under Section 20
The Section 20 consultation process provides leaseholders with important leaseholder rights that protect them from unreasonable expenditure. Understanding these rights enables leaseholders to participate effectively in the consultation process and hold their landlord or managing agent to account.
Right to Be Consulted
Leaseholders must be consulted at each stage of the process and given adequate time to consider and respond to proposals. The minimum observation period is 30 days at each stage.
Right to Nominate Contractors
At Stage 1, leaseholders can nominate contractors from whom the landlord must obtain estimates. This ensures competitive pricing and gives leaseholders direct input into the procurement process.
Right to Make Observations
Leaseholders can submit written observations at both Stage 1 and Stage 2. The landlord must have regard to these observations and respond to them, particularly if not selecting the lowest estimate.
Right to Inspect Documents
Leaseholders have the right to inspect all estimates, specifications, and supporting documents relating to the proposed works. These must be made available for inspection at a reasonable time and place.
Right to Challenge Costs
After works are completed, leaseholders can apply to the First-tier Tribunal to determine whether the costs are reasonable. The tribunal can reduce or disallow charges that it considers unreasonable.
Right to Information
Leaseholders have a general right to request a summary of service charge costs and to inspect supporting documentation under Section 22 of the Landlord and Tenant Act 1985.
For more information about freeholder and leaseholder rights, visit our dedicated rights page or contact our team for personalised guidance on freeholder responsibilities and leaseholder rights.
Frequently Asked Questions About Section 20 Consultation
What is a Section 20 consultation?
A Section 20 consultation is a statutory process required under Section 20 of the Landlord and Tenant Act 1985 before a landlord or managing agent can carry out qualifying works or enter into a qualifying long-term agreement where the cost to any individual leaseholder exceeds a specified threshold. For qualifying works, the threshold is 250 pounds per leaseholder. For long-term agreements exceeding 12 months, the threshold is 100 pounds per leaseholder per year. The consultation process gives leaseholders the right to be informed about proposed expenditure, to make observations, and to nominate contractors.
What happens if Section 20 consultation is not followed?
If the Section 20 consultation process is not followed correctly, the landlord or managing agent maximum recovery from each leaseholder is capped at the relevant threshold: 250 pounds for qualifying works or 100 pounds per year for qualifying long-term agreements. This means the landlord or management company bears the cost of any expenditure above these thresholds. The only way to avoid this limitation is to apply to the First-tier Tribunal for dispensation from all or part of the consultation requirements, which the tribunal may grant if it considers it reasonable to do so.
How long does a Section 20 consultation take?
A full Section 20 consultation for qualifying works typically takes a minimum of three to four months to complete properly. The first stage requires a 30-day observation period after serving the notice of intention. The second stage involves obtaining estimates and allowing leaseholders 30 days to make observations on the proposed expenditure. There are also practical timeframes for preparing specifications, obtaining contractor estimates, and evaluating tenders between the formal consultation stages. Rushing the process risks procedural errors that could invalidate the consultation.
Can leaseholders challenge Section 20 works?
Yes, leaseholders can challenge Section 20 works in several ways. During the consultation process, leaseholders have the statutory right to make written observations at each stage, which the landlord must have regard to. After the works are completed, leaseholders can apply to the First-tier Tribunal to determine whether the costs are reasonable under Section 27A of the Landlord and Tenant Act 1985. The tribunal can reduce or disallow service charge contributions if it finds the costs unreasonable or the consultation process was not properly followed.
What is Section 20 dispensation?
Section 20 dispensation is an order from the First-tier Tribunal that allows a landlord or managing agent to proceed with qualifying works or a qualifying long-term agreement without completing all or part of the statutory consultation process. Dispensation is typically sought in emergency situations where works cannot wait, such as urgent structural repairs or water ingress, or where the consultation process has been inadvertently flawed. The tribunal will only grant dispensation if it is satisfied that it is reasonable to do so, and leaseholders must be given the opportunity to make representations before the tribunal makes its decision.
Need Help with a Section 20 Consultation?
Whether you are planning section 20 major works, need guidance on the consultation process, or want to ensure your existing S20 is fully compliant, our team has the expertise to help. We have completed over 80 Section 20 consultation processes without a successful challenge.