Automated Summary
Key Facts
The First-tier Tribunal (Property Chamber) granted dispensation to Grey GR Limited Partnership for the Vista Tower in Stevenage to proceed with fire safety works without statutory consultation. The works include installing a common fire alarm (interim) and removing/replacing combustible cladding, balconies, and wood elements (main). Dispensation was conditional: £16,500+VAT paid to legal advisors, £20,000+VAT indemnity for expert advice, and provision of Building Safety Fund details and third-party recovery steps. The case relates to post-Grenfell fire safety reforms, with the property converted to residential use in 2015-2016. Leaseholders opposed costs of the waking watch and design fees but accepted the dispensation with specified terms.
Issues
- The tribunal addressed whether the Applicant's proposed scope of works (including 'any other works recommended by a Fire Engineer') was too broad. It concluded that dispensation should be limited to specific items (a-d) and excluded the open-ended provision (e) due to insufficient clarity and potential for overreach.
- The tribunal considered an application under section 20C of the 1985 Act and paragraph 5A of Schedule 11 to the 2002 Act to prevent leaseholders from being charged for the Applicant's legal and professional costs related to the dispensation application. It ruled that the Applicant must bear these costs as it was just and equitable under the circumstances.
- The tribunal assessed the conditions for dispensation, including financial requirements like payment of £16,500 plus VAT for legal costs incurred by leaseholders and an indemnity of £20,000 plus VAT for expert advice. It also ruled on whether these conditions were a reasonable 'price for indulgence' given the Applicant's breach of consultation requirements.
- The tribunal determined whether it was reasonable to dispense with statutory consultation requirements for the Applicant's proposed interim and main fire safety works (including cladding removal and alarm installation) under section 20ZA of the Landlord and Tenant Act 1985. This included evaluating if the consultation breaches (e.g., truncated notice periods, early contract awards) caused relevant prejudice to leaseholders and what conditions should be attached to any dispensation.
Holdings
- The tribunal determined to dispense with all consultation requirements for both interim and main works (removal of combustible cladding and installation of fire alarms), subject to conditions including a £20,000 indemnity for expert advice and reduced costs of £16,500 plus VAT. The scope of the main works was limited to items (a) to (d) as specified in the application, excluding the broader Fire Engineer recommendations.
- The tribunal ordered under section 20C/paragraph 5A that the Applicant must bear all costs of their dispensation application, including legal fees, as it was deemed just and equitable given the Applicant's knowledge of Grenfell-related risks and the nature of the indulgence sought.
Remedies
- The tribunal ordered under section 20C of the Landlord and Tenant Act 1985 that all costs incurred by the Applicant in connection with the dispensation proceedings (totaling £16,500 plus VAT) are not to be regarded as relevant costs for service charge calculations. This was adjusted from the Represented Respondents' initial claim of £30,000 to reflect guideline rates and avoid duplication of counsel fees.
- The tribunal further ruled under paragraph 5A of Schedule 11 to the Commonhold and Leasehold Reform Act 2002 that the Represented Respondents' liability (if any) to pay an administration charge for the costs of the dispensation application is extinguished. This decision was based on the principle that it would be unjust to charge leaseholders for the Applicant's legal costs in seeking relief from consultation requirements.
- The tribunal determined to dispense with all statutory consultation requirements for the interim installation of a common fire alarm and the main works to remove combustible cladding. This was conditional on the Applicant paying £16,500 in legal fees to Burges Salmon LLP by 25 July 2022, providing an indemnity up to £20,000 for expert advice, and sharing specific information about the Building Safety Fund application and remedial works progress. The scope of the main works was limited to items (a)-(d) as outlined in the decision.
Legal Principles
The tribunal applied costs principles under section 20C of the Landlord and Tenant Act 1985 and paragraph 5A of Schedule 11 to the 2002 Act, determining that the applicant must bear the costs of their dispensation application. This included limiting the applicant's costs to £16,500 plus VAT and extinguishing any liability for administration charges, reflecting the 'price of indulgence' for breaching consultation requirements.
Precedent Name
- Marshall v Northumberland & Durham Property Trust Ltd
- Aster Communities v Chapman and others
- Daejan Investments Limited v Benson and Ors
Cited Statute
- Commonhold and Leasehold Reform Act 2002
- Service Charges (Consultation etc) (England) Regulations 2003
- Building Safety Act 2022
- Landlord and Tenant Act 1985
Judge Name
Judge Ruth Wayte
Passage Text
- The tribunal agrees that in the circumstances... it is just and equitable for the Applicant to bear the costs of their application.
- The tribunal agrees that a capped indemnity in respect of expert advice... is an appropriate condition... the indemnity reduced to a maximum of £20,000 plus VAT.
- The tribunal agrees that dispensation should be given in respect of both the interim and main works... Dispensation in relation to the main works will therefore be limited in scope to items (a) to (d) as set out in paragraph 1(ii) above.