© 2025 News On The Block. All rights reserved.
News on the Block is a trading name of Premier Property Media Ltd.
© 2025 News On The Block. All rights reserved.
News on the Block is a trading name of Premier Property Media Ltd.
On 1st May 2002 the Commonhold and Leasehold Reform Act 2002 received Royal Assent and with a few exceptions most of its provisions have since come into force.
Flat owners made particular gains. The abolition of the residence requirement undoubtedly enabled more people to extend their leases or buy the freehold of the building in which their flat is located.
Right to Manage was introduced for the first time in the 2002 Act giving leaseholders of flats the chance to take over the running of the building without having to prove there is anything wrong with the way it is being managed.
It is not a cure-all. It may not be suitable for every building or in some cases the right solution to management problems. Disputes can still arise over the commissioning of major works nor can it be a guarantor of good behaviour by flat-owners. But it is a useful weapon in the armoury of those wishing to improve the management of their building.
Section 21B ensured that with each demand for service charges a leaseholder would receive a summary of rights and obligations. The right to withhold payment is a powerful sanction against a manager who has not supplied the summary in the required form and with the prescribed content. A way of bringing home to leaseholders what legal rights they have in respect of service charges.
One of those rights lies in an enhanced consultation process to be followed before major works are embarked upon or long term agreements entered into for the supply of services or carrying out of works. Also, with it an ability to apply to the Leasehold Valuation Tribunal rather than the county court for an order to dispense with some or all of the procedure.
The remit of the LVT was enhanced to take in all manner of service charge disputes. Not just how much should be paid but does the lease provide for payment.
Charges for sub-letting and alterations as well as interest on arrears are classified as administration charges. As such they must be a reasonable amount, an issue which can be decided by the LVT. And with each demand for administration charges a summary of rights and obligations should be given otherwise payment is suspended.
But as one can see from the title there are two aspects to the 2002 Act and Commonhold came into force in September 2004. Eight years have passed and there has been little take-up so far.
Who knows what the next ten years will bring?
Nicholas Kissen is a Senior Legal Advisor with The Leasehold Advisory Service