The Section 20 consultation process is supposed to protect leaseholders from being overcharged for major works. In theory, it creates transparency — your freeholder must tell you what they’re planning, get competitive quotes, share them with you, and listen to your observations. In practice, the process is riddled with gaps that managing agents exploit daily. Here’s what they’re not telling you.
They Don’t Have to Accept the Cheapest Quote
Many leaseholders assume that if three quotes are obtained, the freeholder must use the cheapest. They don’t. The Landlord and Tenant Act 1985 requires your freeholder to consider any observations you make about the quotes, but does not require them to select the lowest price. A freeholder can choose the most expensive quote, give a reason that sounds reasonable, and proceed — even if you’ve objected.
What this means in practice: if your freeholder’s preferred contractor has a pre-existing relationship with the managing agent, the “competitive tender” process may be largely theatre. Three quotes are obtained, the preferred one wins, and the paperwork is technically compliant.
You Have 30 Days — But Missing the Deadline Doesn’t Mean You Lose
The Notice of Proposal (the second consultation notice) gives you 30 days to submit observations. Many freeholders treat this as a hard deadline — “you didn’t object within 30 days, so your challenge is out of time.”
This is misleading. The 30-day window relates to the consultation stage. Your right to challenge the reasonableness of service charges at the First-tier Tribunal exists separately, under the Landlord and Tenant Act 1985, and you generally have 18 months from when the charge was demanded to challenge it. Not submitting observations during consultation doesn’t bar you from tribunal.
Project Management Fees Are Often Excessive
A standard line item in many Section 20 major works bills is a “contract administration” or “project management” fee, typically expressed as a percentage of the contract sum. The managing agent charges this for overseeing the works on your behalf.
What they won’t tell you: RICS guidance suggests these fees should typically be 5-10% of the contract value for smaller projects. We regularly see fees of 15-20%, sometimes more. On a £60,000 contract, the difference between 8% and 18% is £6,000 — pure profit for the managing agent, charged to your service charge account.
The Quotes May Not Be Genuinely Independent
Under Section 20, the freeholder must obtain at least two quotes from contractors not connected to them. In practice, “connection” is defined narrowly, and many managing agents have informal preferred supplier relationships that aren’t technically disqualifying but are nonetheless a conflict of interest.
We have reviewed cases where all three “competitive” quotes came from contractors who appeared on the same preferred supplier list, quoted remarkably similar prices, and had all previously worked for the same managing agent. Proving this is difficult, but the pattern of inflated, suspiciously similar quotes is a consistent red flag.
You Can Nominate a Contractor
This is perhaps the least-known right in the Section 20 consultation. When you receive the Notice of Intention — the first consultation notice — you have the right to nominate a contractor whose quote the freeholder must seek. They must include this contractor in the tender process.
Few leaseholders know this. Fewer still exercise it. But it’s a powerful tool: if you nominate a reputable local contractor and their quote comes in at £35,000 against the managing agent’s preferred contractor at £52,000, that’s evidence you can use.
Emergency Works Can Bypass Consultation Entirely
Freeholders can carry out works without Section 20 consultation in genuine emergencies. The problem is that “emergency” is sometimes stretched considerably. We have seen cases where scaffold already in place for planned works was claimed to justify bypassing consultation on additional items, or where routine maintenance that had been deferred for years was suddenly declared urgent.
If works were done without consultation and you weren’t notified, you should scrutinise the claimed emergency basis carefully. The freeholder bears the burden of justifying the emergency.
What You Can Do
Understanding the gaps in the system is the first step. The second is getting professional evidence. An independent cost assessment gives you something concrete — not suspicion, but numbers, backed by market data, produced by a qualified surveyor, and formatted for use at the First-tier Tribunal if needed.
Think your bill might be inflated? Get an independent assessment from Section20.org.uk — 48-hour turnaround, fixed fee. Email info@rapidqs.uk, WhatsApp us at +44 7438 628277 (5-minute response guaranteed), or fill in our contact form at section20.org.uk