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Case Study: CWC Solicitors successfully represents vulnerable leaseholder respondents at tribunal hearing

Thursday March 23, 2023

Charles Knapper, Consultant Partner at CWC Solicitors, successfully represents vulnerable leaseholder Respondents at Tribunal Hearing.

The tribunal ruling of 10 February 2023 found that Adrian Curtis, the operations manager of Dibleys Heritage – who is understood to be the son of an ex-director who lives on site – and the directors of Dibleys Heritage Limited had agreed to a three-year gas communal contract at £66,000 a year without following correct section 20 procedures. This meant that the 45 leaseholders – the entire site has nine houses and 47 bungalows, some being freehold – who are also shareholders of Dibleys Heritage Limited had no say in the contract.

Dibleys Heritage, in Blewbury outside Didcot, a desirable retirement site in extensive grounds where the freehold is owned by the residents, asked for and was granted retrospective dispensation for a section 20 consultation. The tribunal noted:

“It was explained that the failure to implement the Section 20 Procedure in respect of the Contract for the supply of gas on 29th March 2022 was in part due to training in 2019 undertaken by the Applicant’s Directors and Operations Manager [Adrian Curtis] which misled them to believe that consultation was not necessary where service charges were demanded on the account. In July 2022, the Applicant’s current solicitors corrected the Applicant’s Directors’ and Operations Manager’s misunderstanding.”

Although the tribunal did grant Dibleys Heritage Limited dispensation from section 20 retrospectively, it was ordered within 21 days of the ruling:

“To provide leaseholders with a statement explaining why the contract was agreed, the tariff, the unit rate and standing charges, estimated usage and costs for each residence, as well as applicability to the government’s Energy Bill Relief Scheme. In addition, leaseholders must be allowed to see and take copies of the long-term qualifying agreement.”

In spite of this ruling, leaseholders have told LKP that this information has not been forthcoming. A copy of the tribunal ruling has been distributed, as has a letter from Dibleys Heritage chair Elizabeth Sweet stating that service charges would have to rise by £36,450 to pay for the company’s legal expenses at the tribunal.

A condition of the dispensation was that Dibleys Heritage Limited had to pay the legal costs of the hearing and those of Dean Evans, a leaseholder who objected to the section 20 error: thought to be another £4,000 on top of the company’s £36,450.

Charles Knapper, Consultant Partner at CWC Solicitors, representing Mr Evans, a leaseholder, said that Dibleys Heritage tried to dissuade him, “in his view unfairly”, from objecting to the dispensation proceedings “as it would incur the other tenants in the unnecessary expense which could cause discontent and discord”.

The tribunal ruled: “The Tribunal finds, and the Applicant admitted that none of the consultation requirements referred to in Section 20 of the Landlord and Tenant Act 1985 and as set out in Schedule 1 of the 2003 Regulations 2003 have been complied with.”

“The Tribunal finds that the Applicant did not attempt to comply with the consultation procedure under section 20 of the 1985 Act and as set out in Schedule 1 of the 2003 Regulations. The Contract was completed on 29th March 2022 and yet the Respondents were not informed of the Contract until the Summer Report of 31st May 2022.

“The reason given for the non-compliance that the Applicant’s Directors and Operations Manager did not know that they had to provide the information is not considered reasonable. The role that these persons play requires them to be aware of the statutory obligations especially where large sums of money are to be paid by vulnerable persons. In the circumstances, the Respondents were entitled to object to the Dispensation Application and Mr Evans was entitled to present his submission at an oral hearing.”

As a result, all Mr Evans legal costs, thought to be about £4,000, were awarded against Dibleys Heritage Limited. The tribunal ruling also revealed alarming practices in the management of Dibleys Heritage.

LKP has been contacted intermittently for some years over concerns at the management of Dibleys Heritage Limited, in particular concerns by elderly residents to surrender their 1988 leases, which have length terms of nearly 1,000 years, in favour of a new lease.

This week Mr Knapper wrote to the solicitors, acting for Dibleys Heritage Limited, to confirm and explain the legal costs of more than £36,000, “failing which we will have to make a formal application for the costs to be assessed [by the tribunal] and we will expect your client to meet the costs of the assessment”.

Referencing the “debacle” of the gas supply contract, he added that the directors of Dibleys Heritage Limited “appear to have incurred costs of £36,450 because they did not comply with the provisions of the Landlord and Tenant Act 1985. Your duty is to the company and not to the directors and we therefore consider you are under a duty to point this out to the members.”

Charles Knapper, Consultant Partner at CWC Solicitors, successfully represents vulnerable leaseholder Respondents at Tribunal Hearing.