Martin & Anor v Maryland Estates Ltd

Section 20(9) of the Landlord and Tenant Act 1985 does not give the court a general dispensing power. The discretion arises only after the court is satisfied that the landlord acted reasonably, assessed in all the circumstances of the failure to comply. A deliberate decision not to inform or consult tenants about substantial additional works, because they appeared uncooperative, fails that threshold. The £1,000 limit in section 20(3) requires a commonsense identification of the relevant batch of qualifying works. A single contract is important but not invariably decisive. Where additional works are treated as a variation of the original contract, the threshold is not separately available. The limit is a triviality threshold, not a general margin of error.

The landlord owned a converted house containing three flats. Two long-lease tenants challenged service charges for external repairs and redecoration under sections 18 to 20 of the Landlord and Tenant Act 1985. The landlord had served a section 20 notice for the original works. After work began, substantial additional works were identified, but the landlord deliberately did not inform or consult the tenants about them.

The Clerkenwell County Court found that the works and expenditure were generally reasonable. It nevertheless declined to dispense with the section 20 requirements for the additional works and treated the £1,000 limit as applying to the works as a whole. The landlord appealed on those two issues. The central questions were whether the landlord had acted reasonably for section 20(9) purposes and whether the additional works constituted a separate batch of qualifying works.

1. Dispensation under section 20(9). Lord Justice Robert Walker held that section 20(9) creates a two-stage process. The court’s discretion to dispense with all or any relevant requirements arises only after it is satisfied that the landlord acted reasonably. There is no general dispensing power.
2. Reasonableness threshold. Acting reasonably means acting reasonably in all the circumstances where section 20 has not been complied with. The landlord deliberately decided not to inform or consult the tenants about substantial additional works because of their perceived lack of co-operation and potential for obstruction. That conduct was not reasonable for section 20(9) purposes. The statutory purpose of section 20 is consultation, so that tenants know what works are proposed and what may ultimately be charged to them. The impracticability of complying with every requirement in section 20(4) did not justify a total disregard of those requirements.
3. The tenants’ failure to respond, their negative attitude, possible delay, the risk of increased costs, the basis on which the estimates had been prepared, and the landlord’s positive obligation to carry out repairs might have been relevant at the second stage, had the threshold been crossed. They did not make the landlord’s deliberate failure to communicate reasonable.
4. The £1,000 limit. A commonsense approach is required to determine whether qualifying works constitute one batch. The fact that works are performed under one contract is relevant but not invariably decisive. Here the additional works were treated by the surveyor and builder as a variation of the original contract, and some were covered by the original notice. The works therefore formed one batch on the particular facts. The £1,000 limit is a triviality threshold, not a general margin of error which can duplicate a contingency sum.
5. Mr Justice Blofeld agreed with Lord Justice Walker on both issues. The appeal was dismissed, with legal aid taxation of the appellants’ costs.

• Court of Appeal (Civil Division) — Appeal dismissed: [1999] EWCA Civ 3049.
• Clerkenwell County Court — The assistant recorder found the works and expenditure generally reasonable, declined section 20(9) dispensation for the additional works, applied one £1,000 limit to the works as a whole, entered money judgments for the landlord, and adjourned the possession claim.