Section 20 consultation: the £250 cap and how to enforce it

Section 20 of the Landlord and Tenant Act 1985 caps each leaseholder's contribution to qualifying works at £250 unless the landlord follows a strict statutory consultation process. It is the single most-litigated procedural protection in residential leasehold.

When s.20 is engaged

Two triggers:

• Qualifying works where any one leaseholder's contribution exceeds £250.
• Qualifying long-term agreements (QLTAs) — contracts over 12 months where any one leaseholder's contribution exceeds £100 per year.

The consultation regime is set out in the Service Charges (Consultation Requirements) (England) Regulations 2003 (SI 2003/1987). Wales has its own equivalent.

The three schedules

• Schedule 3 — QLTAs (no public notice needed).
• Schedule 4 Part 1 — works under a QLTA already in place.
• Schedule 4 Part 2 — the standard major works route: Notice of Intention → estimates → Notice of Award.

Each stage requires a minimum 30-day observation period. Nominations from leaseholders must be sought and, where practicable, a nominated contractor must provide an estimate.

What "compliance" really means

Case law is uncompromising. See Camden LBC v Leaseholders of the St Christopher Estate — trivial defects can and do defeat consultation. Common failures:

• Sending the notice to the leasehold flat rather than the leaseholder's service address.
• Not summarising leaseholders' observations in the paragraph (b) statement.
• Awarding to a non-nominated, non-lowest bidder without giving reasons.
• Treating a rolling framework agreement as if consultation done once covered every subsequent call-off.

Dispensation: *Daejan v Benson*

Where consultation is defective, the landlord can apply under s.20ZA LTA 1985 for dispensation. The Supreme Court in Daejan Investments Ltd v Benson [2013] UKSC 14 re-set the test:

• Dispensation should be granted unless the leaseholders have suffered relevant prejudice by the breach.
• The landlord bears the burden of showing no prejudice.
• Dispensation can be granted on terms — often that the landlord pays the leaseholders' reasonable costs of dealing with the application, and that any prejudicial cost is disallowed.

This means non-compliance is rarely the end of the world for landlords — but it is the leaseholders' single strongest bargaining chip.

Practical strategy for leaseholders

• Engage during consultation. Ask questions, nominate contractors, request specifications. Silence weakens later objections.
• Log every defect. Late notices, missing summaries, wrong addresses — all matter.
• Get an independent quote. Nothing shifts a hearing like a comparable estimate from a competent contractor.
• Frame prejudice specifically. Not "we would have got it cheaper" but "we would have obtained a quote from X at £Y for a defined scope".

Practical strategy for landlords

• Consult early and generously. Extra rounds cost less than dispensation litigation.
• Document reasoning at every step. Especially why you did not accept a nominated contractor.
• If you are already out of compliance, apply for dispensation proactively — the tribunal is friendlier to a candid landlord than one dragged to Section 20ZA by tenants.

Reading list

• [How to challenge service charges at the FTT](/guides/how-to-challenge-service-charges-at-the-first-tier-tribunal)
• [Reasonableness test for service charges — key caselaw](/guides/reasonableness-test-for-service-charges-key-caselaw-explained)
• Full statutory text: Service Charges (Consultation Requirements) Regs 2003