UK: Statutory Notices And Property Repair

Last Updated: 12 October 2011
Article by Philip Knight

Anyone reading the press at the moment will no doubt be aware of the concerns regarding the statutory notice system currently operated by the City of Edinburgh Council ("the Council").

The Property Conservation service, which issues statutory notices and organises repairs, is currently under review. An independent review is being carried out by Deloitte who are examining various complaints. While the investigation is ongoing, the Property Conservation service is dealing only with emergencies and work which is currently underway. All other statutory notices are currently on hold.

Edinburgh has unique powers derived from a UK Act of Parliament which allows it to issue emergency and non-emergency statutory notices in respect of common parts. In the event of a non-emergency repair, the Council require the owners to carry out works within a short specified period, failing which they instruct a contractor to carry out the work. When the Council appoint a contractor, they charge a 15% management fee upon the final account. Given the short period of time, many owners find it difficult to reach a consensus to carry out the works with their fellow owners resulting in the Council stepping in.

The reasoning behind the legislation is to ensure that Edinburgh's heritage and building stock is preserved and that buildings do not deteriorate and become a danger to the public. There is no doubt that such a system is required, however, the current system would appear to be far from ideal.

Serious concerns have been raised about the transparency of the current system and the potential for abuse. Residents receive an initial costing from a third party surveyor appointed to manage the works on behalf of the Council. Unfortunately, these initial costings often spiral out of control with very little communication to the owners. There is also a concern that the works extend beyond the statutory powers and extend to improvements and non-essential repairs. Many residents feel they have absolutely no control over the works which they are paying for and are hit with a final account worth tens of thousands of pounds payable within short order.

No doubt many of the residents of Edinburgh will be following the investigation closely, if the attendance at a recent meeting held by Gordon Murdie of Quantus QS, on behalf of a Facebook group set up by concerned residents, is anything to go by.

A survey by a systems analyst of 57 residents out of the 200 in attendance during the evening showed that collective contract values had risen from quotations of £4,783,000 to final accounts of £13,624,000, without any warning in most cases.

There might be some good to come out of this matter as it has highlighted the importance of property maintenance. Just like humans, properties grow old and need regular maintenance and repair! Many people are quick to decorate the interiors but fail to have any regard to the external fabric of their building.

Many property owners are unsure of how to begin the process of carrying out works and have difficulty in obtaining the co-operation of the other owners.

It is important to take preventative steps to building maintenance rather than face large repair bills when work becomes a necessity due to structural damage or concerns regarding health and safety.

It is recommended to have a building maintenance survey and report carried out by a reputable surveyor or conservation architect which outlines immediate and longer term projects for maintaining the external fabric of the building.

Before considering a repair, it is necessary to consult the title deeds for the property which outline the rights and responsibilities of the management and maintenance of the common parts.

In the event that the titles are missing vital information, have gaps or defects, The Tenement Management Scheme can be of great existence by providing a set of rules and guidance for managing tenanted property absent guidance from the titles.

The next job is to get all the residents on board - no easy feat with landlords and absentee owners! You should communicate with your neighbours regularly by e-mail, letter or regular meetings. It is advantageous to set up a residents association to manage the repairs absent a property factor or manager. Consideration should be given to setting up a sinking fund whereby residents pay a regular sum of money into a joint account solely for maintaining the common parts.

External property repairs do not come cheap and it may take some convincing to get everyone committed to carrying out the works. If a small handful of residents do not co-operate, the local council might be able to provide financial assistance under the Housing (Scotland) Act 2006.

Grants might be available from various organisations.

Should any property owners fail to make payment, Notices of Potential Liability for Costs can be a useful tool to assist with the recovery of common maintenance costs. A Notice is registered against the property at the Registers of Scotland for a small fee. This can be done as soon as the work has been undertaken, however, in reality this is usually done after the work has been invoiced and the owner has failed to pay. When the owner sells the property in the future, the Notice alerts any incoming owner that they will become liable for these outstanding costs. Given that this is not an attractive proposition for a prospective purchaser they usually insist that the sums are paid off before purchasing the property. The notice is valid for three years and can be renewed at expiry. Whilst this method doesn't guarantee payment, it can be a useful tool.

Alternatively, the other residents may contribute an additional amount and as a last resort raise proceedings against the individual who has failed to pay. An independent report might be enough to sway any potential sceptics as to whether the work is required.

External consultants such as a conservation architect or quantity surveyor (preferably with conservation qualifications) are a must to manage the project and can provide invaluable assistance in recommending a reliable contractor with the relevant experience. You can also obtain information from trade bodies, such as the National Federation of Roofing Contractors.

Many contractors will require evidence of funds before carrying out any work. Do not pay upfront but put the money on a joint interest bearing account on behalf of the owners which can be drawn down in stages. Make sure the account is available to all residents and requires two signatories for authorising payments. This will ensure transparency and trust among the owners. It is also important to have a document between the respective owners summarising the scope of the work and sums involved.

Given that it is likely that the Statutory Notice system in Edinburgh will be undergoing drastic reform in the years to come, careful thought should be given to your current maintenance regime (if any) in the meantime.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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