Home > Cases > Paddington Walk Management Ltd v Governors of Peabody Trust [2009]

The Services Charges (Consultation Requirements)(England) Regulations 2003 provide that, if a landlord proposes to carry out works that would cost individual tenants more than £250, the landlord must formally consult all those expected to contribute.  If the landlord fails to consult, or is not given a dispensation from the Leasehold Valuation Tribunal, he will be unable to recover more than the statutory limit of £250 from each tenant. Similar provisions apply where a landlord intends to enter into a qualifying long-term agreement for the provision of services, save that the costs cap in such cases is £100. The issue was whether, in the case of a head lease of 79 flats, the respective caps were to be applied as single sums or were to be multiplied by the number of dwellings let to the intermediate landlord. The freeholder argued that the low value put on the respective costs caps indicated that the legislature had intended the caps to apply to each dwelling comprised in a head lease. The County Court judge agreed. It would be absurd that a consultation might be required for an expenditure of only £101 between 79 units. Consequently, HH Judge Marshall QC ruled that, because the legislation defines service charge as meaning “an amount payable by a tenant of a dwelling”, the court was required to consider the payment that the intermediate landlord was required to make in respect of each separate dwelling.

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