Major works with ever rising costs

by Readers Question

16:37 PM, 8th July 2020
About 4 weeks ago

Major works with ever rising costs

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Major works with ever rising costs

Can anyone guide me to the right ‘body’ who can give leaseholders advice on ever rising costs of major works to our building. It went for tender with the lowest tender being chosen, it was not going well pre-lockdown and now they are back to work the contractor has ‘found’ (following complaints from residents/leaseholders) that the refurbishment to the critical windows is not good enough and the paint has had to be changed (Dulux to Johnstones) and this will cost another £17,000 and they will drop one coat.

There has also been an issue with the new rainwater down pipes – having made a specification they are now saying that they cannot be sourced so will have to use round instead of rectangle (having insisted that 4″ square or 4 x 3 rectangle was the only way to go) and the only ones available will cost £5000 more for the job – we are only a few months into this (literally probably 2 months of work). Old paint is being scraped off with dust everywhere, people are locked in their flats and cannot escape and I just hoped that before this gets to a point where we cannot return there must surely be an advisory body we can turn to to help us – the management is sympathetic, but obviously the Freeholder is in charge and we pay for it. The refurb is decades over due and costing £1m (with more to come).

The residents did take a case against the Freeholder to the 1st Tier Tribunal which was a mass of work and very expensive, but even though we won our case we ended up paying the Freeholders costs – so financially ended up with nothing and still a rubbish job (a heat and hot water communal system that took 2 years to get working) We really don’t want to be going down that road again.

We are in the process of buying the Freehold.

Many thanks

Elizabeth



Comments

Clint

10:20 AM, 9th July 2020
About 4 weeks ago

We were recently sent letters with quotes from companies for fire safety upgrading in a tower block where the quotes ranged from £310,000 to £640,000
where studio flats had to contribute £4500 and larger flats a lot more.
We did our own research with established companies and found that the works could be carried out for around £80,000 which is obviously substantially less. We had a collective meeting and accordingly have sent a letter to the management company stating that none of us would make a payment unless the company we recommended was allowed to tender and possibly used to carry out the works. We are now waiting to hear as this was only done yesterday.
With regards to going to the tribunal, I had been to the LVT (equivalent to First Tier Tribunal these days) years ago where we were charged around £2000 for painting a wall. I won the case and it was agreed that the cost should have been around £300.
To my shock, I was billed for around £2700 as, I had to pay the freeholders costs for the tribunal case where, the solicitor who did not even attend the hearing, was charging £230 per hour where he charged this rate for his time for even photocopying as, he was a one man band and did not have a secretary.
On appealing, I once again lost and ended up paying something like £4700, at which time I gave up as the next stage was to go to the Lands Tribunal and I could not take the risk of losing any more. That was a lot of money in those days.
I later found out that in my appeal, I should have pointed out that it was an unfair term that, I had to pay the Freeholder's costs when the Freeholder lost the case, and things may have then been very different.

Sebastian O'Kelly

10:32 AM, 9th July 2020
About 4 weeks ago

Try the leaseholders' charity http://www.leaseholdknowledge.com

The absolute rule of leasehold litigation is to pay first, fight second, owing to the unfair cost regime under leases. There are many examples of disastrous litigation on the LKP website where people have not followed this. There are successes with section 20, too. But it is major litigation and needs a strong group to pool resources and pay for professionals. No one is going to pay much attention to a lay person's opinion on a major work to a high rise block, for eg.

Jon D

16:52 PM, 11th July 2020
About 3 weeks ago

First, regarding the other side's legal fees - if your lease says you are liable for such you can ask to have this struck off at step 1 at the LVT, I hear.

Second, Liz - what does your lease actually say? You should dig it out and read the clauses. Notably is this a repair only lease? If it reads "to maintain in good and proper condition the roof, drive, drainpipes" whatever, there is no provision for improvements. As such good repairs can only be made unless it is no longer economical to do so. To prove that is a burden falling on the freeholder (landlord) / managing agent. And if they wrongly replace old with new, you can claim the financial cost to you as leaseholder is zero (or max £250) - but I believe zero, and the landlord (lessor) bears the full cost of these works if challenged later.

Check for clauses where it indicates the landlord (lessor) must make a contribution. For example, one lease I had did make this clear, only for the driveway. Interesting when the landlord gets a % of the bill.... Their proxies access the estate after all.

And note that since the Garside case the financial impact on leaseholders needs to be taken into account. So repairs should be phased. It is improper to do everything at once if you resist it. For example, internal decorations can wait a couple of years after external works. If there are two roofs, do one at a time etc.

Harlequin Garden

13:51 PM, 12th July 2020
About 3 weeks ago

Reply to the comment left by Jon D at 11/07/2020 - 16:52
Thanks for the comments - the issues we have is that we are implementing 'major works' repairs not renewals - but I will look into the renewal bit - no works have been done on the building in around 15/20 years so it is in poor shape even though the landlords lease states that it should be redecorated and works carried out every 7 years. This apart, what we have now is that a the process has been carried out correctly with the S20 then tenders but the costs are rising on a fixed cost job - what I need to find out is how to challenge this - they inspected and tendered and now they can't do it for that money - I suspect that the lowest tender could never do it for the cost they propose and rely on uplifts during the job - when maybe the higher bidders could have carried out the works as described

Jon D

14:35 PM, 14th July 2020
About 3 weeks ago

Sounds to me like the S20 process is not being observed - it should take place again and to the book. This time also inform the landlord/agent that work must be phased and check closely if the result - or elements of the work - can be described as an 'improvement'.

Your max liability as leaseholder is £250 for major works, if S20 process has not been followed and nil if a repair is actually an improvement.


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