I85PREP
⌘ K
TPI Level 4 Member Exam in Leasehold Management study materials
TPI Level 4 Member Exam in Leasehold Management study resources

TPI Level 4 Member Exam in Leasehold Management practice questions

One question at a time. Build your TPI Level 4 Member Exam in Leasehold Management understanding.

First 50 of 200 questions. Each one lists the choices, the correct answer, and an explanation. The checker at the top of this page saves progress in this browser when it is available.

Continue in the practice tool above to load more questions, 50 at a time.

Question 1Leasehold law and the legal framework governing long leases

Under section 18 of the Landlord and Tenant Act 1985, a service charge is an amount payable by a tenant of a dwelling, as part of or in addition to the rent, for which of the following?

  1. Services, repairs, maintenance, insurance or the landlord's management costs Correct answer.
  2. Only sums paid into a reserve or sinking fund
  3. Ground rent and other sums reserved as rent under the lease
  4. Only works of repair to the structure and the common parts of the building

Explanation

Section 18(1) of the Landlord and Tenant Act 1985 defines a service charge as an amount payable by a tenant of a dwelling, as part of or in addition to rent, for services, repairs, maintenance, improvements or insurance, or the landlord's costs of management, where all or part of the amount varies according to the costs incurred. The definition is broad and is not limited to physical repairs or to sums held in reserve.

Question 2Leasehold law and the legal framework governing long leases

For the purposes of the Leasehold Reform, Housing and Urban Development Act 1993, a lease is generally a long lease if it was granted for a term exceeding what period?

  1. Twenty-one years Correct answer.
  2. Seven years
  3. Fifty years
  4. Ninety-nine years

Explanation

The 1993 Act treats leases granted for a term exceeding 21 years as long leases, together with certain special cases such as leases terminable on death or marriage. The 21-year threshold is what distinguishes long residential leases from ordinary short lettings.

Question 3Leasehold law and the legal framework governing long leases

A document headed 'licence agreement' gives an occupier the right to occupy a flat exclusively for 12 months at a monthly payment, and the owner keeps no right to occupy the flat or to move the occupier elsewhere. How is the arrangement most likely to be classified?

  1. As a lease, because exclusive possession for a term at a rent indicates one Correct answer.
  2. As a tenancy at will, because no rent is reserved
  3. As a licence, because the document is described as a licence
  4. As a licence, because the occupier has been given no legal estate in the land capable of registration

Explanation

In Street v Mountford the House of Lords held that the label chosen by the parties is not decisive: a grant of exclusive possession for a term at a rent creates a lease unless special circumstances negate any intention to create a tenancy. Calling the document a licence does not prevent a lease arising where its substance is a tenancy.

Question 4Leasehold law and the legal framework governing long leases

A landlord proposes qualifying works to a block containing 12 flats at a total cost of £5,000, and the whole cost is recoverable through service charges with no other contributions. Which statement best describes the consultation position?

  1. No consultation is needed because the works are not 'qualifying works'
  2. No consultation is needed because the total cost is under £10,000
  3. Consultation is needed only if the works last more than 12 months
  4. Consultation is required, as each tenant's share exceeds £250 Correct answer.

Explanation

Section 20 of the Landlord and Tenant Act 1985 requires consultation where the landlord proposes qualifying works and the relevant contribution of any tenant would exceed £250; the limit is applied per tenant, not to the total cost of the works. Here each of the 12 flats would bear about £417, so the consultation requirements apply.

Question 5Leasehold law and the legal framework governing long leases

Where a landlord must consult tenants about qualifying works under section 20 of the Landlord and Tenant Act 1985, what must be obtained at the stage dealing with estimates?

  1. At least three estimates, all of them from contractors nominated by the tenants or their association
  2. One estimate only, provided it is from an independent surveyor
  3. Two estimates, one from an unconnected contractor where practicable Correct answer.
  4. At least two estimates, both from contractors chosen by the landlord's managing agent

Explanation

The Service Charges (Consultation Requirements) (England) Regulations 2003 require the landlord to obtain at least two written estimates and, where practicable, at least one from a person wholly unconnected with the landlord. The estimates must then be made available for inspection by the tenants and any recognised tenants' association.

Question 6Leasehold law and the legal framework governing long leases

A landlord carried out urgent roof repairs without serving any consultation notices, and the cost attributable to each tenant exceeds the threshold. If the tenants challenge the charge before the First-tier Tribunal, what is the tribunal's power?

  1. The tribunal may dispense with some or all of the consultation requirements Correct answer.
  2. The tribunal may only reduce the cost to a maximum of £250 per tenant
  3. The tribunal must disallow the whole of the cost, since consultation did not occur
  4. The landlord must refund the whole cost and then re-consult before recharging it

Explanation

Section 20ZA of the Landlord and Tenant Act 1985 allows the First-tier Tribunal to dispense with some or all of the consultation requirements where it is satisfied that it is reasonable to do so, and it may impose conditions. Without dispensation, the landlord's recoverable costs are limited by the statutory cap under section 20(7).

Question 7Leasehold law and the legal framework governing long leases

Where a landlord has incurred costs in proceedings before the First-tier Tribunal concerning service charges, when may those costs be recovered from tenants through a service charge?

  1. Only where the tribunal dismissed the tenants' application
  2. Whenever the lease permits recovery of professional costs generally
  3. Whenever the landlord succeeded at the tribunal hearing
  4. Only where the tribunal so orders, the lease permitting Correct answer.

Explanation

Section 20C of the Landlord and Tenant Act 1985 provides that a landlord may not recover the costs of tribunal proceedings relating to service charges through a service charge unless the tribunal so orders. In deciding whether to make an order, the tribunal considers whether the costs were reasonably incurred.

Question 8Leasehold law and the legal framework governing long leases

A tenant disputes a service charge for external painting, arguing that the work was unnecessary and the charge excessive. Which is the correct statutory test under section 19(1) of the Landlord and Tenant Act 1985?

  1. The costs must be reasonably incurred and the works of a reasonable standard Correct answer.
  2. The charge must be supported by an independent surveyor's certificate
  3. The charge is payable if the landlord acted in good faith, irrespective of the cost
  4. The landlord's actual expenditure, whatever its amount, is binding if the lease permits recovery

Explanation

Section 19(1) of the Landlord and Tenant Act 1985 limits recoverable service charges to costs reasonably incurred and, where the charge relates to works, to work done to a reasonable standard. The tribunal decides whether those tests are satisfied; good faith or a lease clause permitting recovery does not displace them.

Question 9Leasehold law and the legal framework governing long leases

A tenant pays an estimated service charge quarterly. At the year end the actual costs exceed the estimates and the lease allows a balancing charge. What is the effect of section 19(2) of the Landlord and Tenant Act 1985?

  1. The landlord cannot recover anything beyond the estimates already invoiced
  2. Only a reasonable amount is payable in respect of that period Correct answer.
  3. The tenant must pay the full balancing charge, because estimates and actual costs are treated separately
  4. The balancing charge is irrecoverable unless approved at a general meeting of tenants

Explanation

Section 19(2) applies where a service charge is payable before the relevant costs are incurred: only a reasonable amount may be charged, and a later balancing charge cannot make the tenant liable beyond what is reasonable for that period. The provision guards against a landlord recovering excessive sums in advance of actual expenditure.

Question 10Leasehold law and the legal framework governing long leases

A landlord serves a demand for service charges on a residential long leaseholder. What must accompany the demand under section 21 of the Landlord and Tenant Act 1985?

  1. A certificate from the managing agent that the costs are reasonable
  2. A summary of the tenant's rights and obligations in relation to service charges Correct answer.
  3. A copy of the current buildings insurance policy
  4. An audited set of accounts signed by a qualified accountant

Explanation

Section 21 of the Landlord and Tenant Act 1985 requires a written summary of the rights and obligations of tenants in relation to service charges to accompany every demand. A demand that omits the required summary does not comply with the section.

Question 11Leasehold law and the legal framework governing long leases

Under section 22 of the Landlord and Tenant Act 1985, what right does a tenant who is liable to pay a variable service charge have?

  1. A right to withhold the whole service charge until accounts are produced
  2. A right to be appointed as a director of the management company
  3. A right to demand that the landlord change managing agents
  4. A right to inspect relevant documents and take copies Correct answer.

Explanation

Section 22 of the Landlord and Tenant Act 1985 entitles a tenant liable to pay a variable service charge to inspect the accounts, receipts and other documents relevant to the charge, and to be supplied with copies on payment of reasonable expenses. A recognised tenants' association has similar rights.

Question 12Leasehold law and the legal framework governing long leases

A demand for service charge must contain information required by sections 47 and 48 of the Landlord and Tenant Act 1987. What is the consequence of failing to comply with section 47?

  1. The demand is not valid, so nothing is due under it Correct answer.
  2. The demand becomes payable after a 28-day delay
  3. The tenant may apply to the tribunal to strike out the demand
  4. The landlord commits a criminal offence and is liable to a fine

Explanation

Section 47 of the Landlord and Tenant Act 1987 requires a demand for rent or service charge to contain the landlord's name and a business address, and section 48 requires an address in England and Wales at which notices may be served. A demand that does not comply is treated as not being a demand, so the sum is not due until a compliant demand is served.

Question 13Leasehold law and the legal framework governing long leases

The freeholder of a building containing six flats, all let on long leases, proposes to sell the freehold to a third party. Which statement best reflects Part I of the Landlord and Tenant Act 1987?

  1. The tenants have no rights because the building has more than four flats
  2. The tenants may buy the freehold only after the sale has completed
  3. The tenants have a right to buy only if the freeholder is a company
  4. The tenants must be offered the freehold on the same terms first Correct answer.

Explanation

Part I of the Landlord and Tenant Act 1987 gives qualifying tenants of a building containing at least two flats a right of first refusal when the landlord proposes a relevant disposal. The landlord must serve an offer notice on the qualifying tenants, who may accept it or nominate a purchaser, before the interest is sold to anyone else, subject to the statutory exemptions.

Question 14Leasehold law and the legal framework governing long leases

Before demanding a fixed ground rent from a long leaseholder of a dwelling, what does section 166 of the Commonhold and Leasehold Reform Act 2002 generally require?

  1. That the tenant is given a prescribed notice in the specified form Correct answer.
  2. That the amount is registered with the First-tier Tribunal
  3. That the demand is sent by recorded delivery
  4. That the ground rent is supported by a surveyor's valuation

Explanation

Section 166 of the Commonhold and Leasehold Reform Act 2002 provides that a tenant is not liable to pay ground rent until the landlord has served a notice in the prescribed form containing the required information. Forfeiture or possession action for unpaid ground rent is also barred until that notice has been served.

Question 15Leasehold law and the legal framework governing long leases

A landlord wishes to forfeit a lease because the tenant has breached a covenant to keep the garden tidy. What does section 168 of the Commonhold and Leasehold Reform Act 2002 require before forfeiture proceedings are begun?

  1. A section 146 notice served at least six months before proceedings are issued
  2. The consent of the First-tier Tribunal to issue the proceedings
  3. That the tenant has failed to remedy the breach within 14 days of a warning letter
  4. That the breach has been admitted or determined by a court or tribunal Correct answer.

Explanation

Section 168 of the Commonhold and Leasehold Reform Act 2002 bars forfeiture for breach of covenant (other than non-payment of rent or service charges) unless the breach has been admitted or finally determined by a court, tribunal or arbitrator. A section 146 notice is also required in most cases, but it is not a substitute for the section 168 condition.

Question 16Leasehold law and the legal framework governing long leases

Under section 146 of the Law of Property Act 1925, what must a notice served before forfeiture for breach of covenant specify?

  1. A date, not less than 30 days ahead, for the tenant to vacate
  2. The breach, the remedy required where it is capable of remedy, and compensation Correct answer.
  3. The tribunal's determination of the breach and the sum due
  4. The landlord's intention to re-enter and the tenant's right to a new lease

Explanation

Section 146 of the Law of Property Act 1925 requires, before forfeiture for breach of covenant, a notice specifying the breach, requiring it to be remedied if it is capable of remedy, and requiring compensation in money for the breach. Forfeiture is not enforceable unless the tenant fails to comply with the notice within a reasonable time.

Question 17Leasehold law and the legal framework governing long leases

For a claim to collective enfranchisement under the Leasehold Reform, Housing and Urban Development Act 1993, what proportion of the flats in the building must be let to qualifying tenants?

  1. At least one-half
  2. At least two-thirds Correct answer.
  3. At least three-quarters
  4. All of them

Explanation

Section 3 of the 1993 Act requires the building to contain at least two flats let to qualifying tenants, and at least two-thirds of the flats in the building to be let to qualifying tenants. A qualifying tenant is essentially a long leaseholder whose lease is not a business tenancy.

Question 18Leasehold law and the legal framework governing long leases

Under the 1993 Act as amended, a building cannot be the subject of collective enfranchisement if its internal floor area includes non-residential parts exceeding what proportion?

  1. 10 per cent
  2. No limit is imposed
  3. 25 per cent Correct answer.
  4. 50 per cent

Explanation

The 1993 Act, as amended by the Commonhold and Leasehold Reform Act 2002, requires that the internal floor area of any non-residential parts of the building must not exceed 25 per cent of the total internal floor area. The same 25 per cent limit applies to the right to manage.

Question 19Leasehold law and the legal framework governing long leases

On a successful statutory lease extension claim under the 1993 Act, what happens to the lease?

  1. The freehold is transferred to the tenant on payment of a premium
  2. A new lease is granted for 99 years from the date of the claim
  3. The existing term is extended by 50 years at the existing ground rent
  4. A new lease for 90 years beyond the existing term at a peppercorn rent Correct answer.

Explanation

Section 56 of the 1993 Act provides for a new lease of the flat for the unexpired term of the existing lease plus 90 years, at a peppercorn (nil) ground rent, in return for a premium determined under the statutory valuation. The landlord's freehold reversion is not transferred.

Question 20Leasehold law and the legal framework governing long leases

A flat is held on a 125-year lease granted eight years ago. The leaseholder wants a statutory lease extension. Which condition about length of ownership must be satisfied?

  1. The leaseholder must have owned the lease for at least two years Correct answer.
  2. The leaseholder must own at least two flats in the building
  3. The leaseholder must have occupied the flat as their only or main home for three years
  4. The leaseholder must have owned the lease for at least five years

Explanation

Section 39(2) of the 1993 Act requires the tenant to have been a long leaseholder of the flat for the two years before the claim is made. Occupation as a residence is not a condition of a statutory lease extension.

Question 21Leasehold law and the legal framework governing long leases

Which statement about acquiring the right to manage under the Commonhold and Leasehold Reform Act 2002 is correct?

  1. The tenants must buy the freehold at the same time
  2. A premium is payable, calculated on the same basis as for enfranchisement
  3. No premium is payable to the landlord for the right Correct answer.
  4. The right may be exercised only if the landlord agrees to it

Explanation

The right to manage under the Commonhold and Leasehold Reform Act 2002 is a no-fault right: the RTM company takes over the landlord's management functions without paying any premium or compensation and without proving any default by the landlord.

Question 22Leasehold law and the legal framework governing long leases

On what basis may the First-tier Tribunal appoint a manager under Part II of the 1993 Act?

  1. Only where the service charge arrears exceed £1,000 per tenant
  2. Where the tribunal is satisfied, on specified grounds, that management is unsatisfactory Correct answer.
  3. Only where the landlord has been convicted of a criminal offence relating to the building
  4. Only where the landlord consents to the appointment

Explanation

Section 24 of the 1993 Act allows a qualifying tenant, or another relevant person, to apply for the appointment of a manager where the tribunal is satisfied of one or more of the grounds in section 24(2). Those grounds include unsatisfactory management and the imposition of unreasonable service charges.

Question 23Leasehold law and the legal framework governing long leases

Which body determines disputes about the reasonableness of service charges in England under the current statutory scheme?

  1. The county court sitting with a jury
  2. The First-tier Tribunal (Property Chamber) Correct answer.
  3. The Housing Ombudsman
  4. The Leasehold Valuation Tribunal

Explanation

The Leasehold Valuation Tribunal was replaced in England by the First-tier Tribunal (Property Chamber) under the Transfer of Tribunal Functions Order 2013, and it hears service charge, enfranchisement and right to manage disputes. The Leasehold Valuation Tribunal continues to operate in Wales.

Question 24Leasehold law and the legal framework governing long leases

Where a long lease contains no satisfactory provision for the recovery of a particular item of expenditure, on what basis may the First-tier Tribunal vary the lease under Part IV of the 1993 Act?

  1. Where the lease fails to make satisfactory provision for repair or insurance Correct answer.
  2. Only where the lease has less than 20 years left to run
  3. Only where the landlord has failed in its management obligations
  4. Only if every party to the lease agrees to the variation

Explanation

Section 35 of the 1993 Act permits an application to the First-tier Tribunal to vary one or more leases where they fail to make satisfactory provision for matters such as repair, maintenance, insurance or the recovery of expenditure. The tribunal may vary the lease and may order compensation for any loss resulting from the variation.

Question 25Leasehold law and the legal framework governing long leases

A long leaseholder considers that the buildings insurance arranged by the landlord is unsatisfactory. What is the tenant's statutory route?

  1. To require the landlord to transfer the freehold to a management company
  2. To serve a section 146 notice on the landlord
  3. To insure the building independently and deduct the premium from the rent
  4. To apply to the First-tier Tribunal for a determination Correct answer.

Explanation

Section 30B of the Landlord and Tenant Act 1985 allows a tenant to apply to the First-tier Tribunal where the landlord's insurance is unsatisfactory or the premium unreasonable. The tribunal may make an order controlling the landlord's choice of insurer or the terms of the policy.

Question 26Leasehold law and the legal framework governing long leases

Under section 21 of the Landlord and Tenant Act 1985, what may the tenant of a dwelling let on a long lease require the landlord to provide?

  1. A written summary of the parties' rights and obligations under the lease Correct answer.
  2. A copy of the buildings insurance policy for the current year
  3. A certified copy of the registered freehold title for the whole building
  4. Copies of the service charge accounts for the past three years

Explanation

Section 21 of the Landlord and Tenant Act 1985 entitles a tenant liable to pay a service charge to require the landlord to supply a written summary of the rights and obligations of the landlord and tenant under the lease, in the prescribed form. It is a summary of lease terms and related statutory rights, not a title or accounts document.

Question 27Leasehold law and the legal framework governing long leases

A landlord grants a new lease of a flat to a tenant for a term of 125 years. Which statement about the repairing covenant implied by section 11 of the Landlord and Tenant Act 1985 is correct?

  1. It applies and obliges the landlord to keep the structure and exterior in repair
  2. It applies, but only once the first five years of the term have elapsed
  3. It applies, but only to the common parts and shared structure of the building
  4. It does not apply because the term exceeds seven years Correct answer.

Explanation

Section 11 implies repairing obligations only into leases of dwellings granted for a term of less than seven years, so a 125-year lease falls outside it. The landlord's repairing duties in a long lease therefore depend on the express covenants in that lease.

Question 28Leasehold law and the legal framework governing long leases

In March 2024 a landlord served a service charge demand on a leaseholder for major works completed in June 2021. The landlord had given the leaseholder no written notice that the costs had been incurred. Which statement is correct?

  1. The costs are not recoverable, because they were incurred over 18 months before the demand Correct answer.
  2. The landlord may recover the costs but is entitled to add interest from the date the works finished
  3. The leaseholder must pay because the demand was served within three years of the works being completed
  4. The leaseholder must pay in full because the works were completed before the demand was served

Explanation

Section 20B of the Landlord and Tenant Act 1985 prevents a landlord from recovering costs incurred more than 18 months before a demand unless, within that 18-month period, the tenant was notified in writing that the costs had been incurred and would be charged to them. Here no such notice was given, so the costs cannot be recovered.

Question 29Leasehold law and the legal framework governing long leases

A tenant holds a house on a lease originally granted for 99 years at a rent of £10 a year and wishes to acquire the freehold under the Leasehold Reform Act 1967. Which further condition must the tenant satisfy?

  1. The house must be the tenant's only or main residence Correct answer.
  2. The landlord must be a private individual rather than a company
  3. The building must contain no more than one flat
  4. The lease must have at least 50 years left to run when the claim is made

Explanation

The 1967 Act requires a long tenancy at a low rent and that the house is occupied by the tenant as their only or main residence, either for the last 12 months or for periods amounting to three years in the last ten. The long tenancy and low rent are already present, so the residence condition is the additional requirement.

Question 30Leasehold law and the legal framework governing long leases

A lease contains no express covenant from the landlord on the point. Which covenant is nevertheless implied into the lease in favour of the tenant?

  1. A covenant to keep the exterior in repair at the landlord's cost
  2. A covenant to pay the buildings insurance premium without recovery
  3. A covenant for quiet enjoyment of the premises Correct answer.
  4. A covenant to renew the lease on the same terms at expiry

Explanation

Where the lease is silent, the law implies a landlord's covenant for quiet enjoyment, together with the principle that the landlord must not derogate from the grant. This protects the tenant's lawful possession and enjoyment of the premises against disturbance by the landlord or those claiming under the landlord.

Question 31Service charges: calculation, apportionment, reasonableness and recovery

Which of the following payments is a service charge within the meaning of section 18 of the Landlord and Tenant Act 1985?

  1. A premium paid to the landlord when the lease is granted
  2. Council tax charged on the flat by the local authority
  3. A ground rent reserved in the lease at a fixed yearly sum
  4. A variable charge for repairs and management of the flat Correct answer.

Explanation

Section 18 defines a service charge as an amount payable by the tenant, as part of or in addition to rent, which varies according to the costs incurred by the landlord in providing services, repairs, maintenance, improvements, insurance or management. The defining feature is variation by reference to the landlord's costs.

Question 32Service charges: calculation, apportionment, reasonableness and recovery

A tenant complains both that the cost of external decorations was excessive and that the work was carried out to a poor standard. Which provision contains the statutory tests for both complaints?

  1. Section 19(1) of the Landlord and Tenant Act 1985 Correct answer.
  2. Section 22 of the Landlord and Tenant Act 1985 (inspection of documents)
  3. Section 20 of the Landlord and Tenant Act 1985
  4. Section 21 of the Landlord and Tenant Act 1985

Explanation

Section 19(1) has two limbs: the costs must be reasonably incurred, and the works or services must be of a reasonable standard. Excessive cost engages the first limb and poor workmanship engages the second.

Question 33Service charges: calculation, apportionment, reasonableness and recovery

Consultation under section 20 is triggered for qualifying works where the relevant contribution of any tenant would exceed which amount?

  1. £500
  2. £100
  3. £1,000
  4. £250 Correct answer.

Explanation

The threshold for qualifying works is £250 per tenant for any one set of works. The total cost of the works is irrelevant if no single tenant's contribution exceeds that figure.

Question 34Service charges: calculation, apportionment, reasonableness and recovery

A landlord proposes a five-year contract for lift maintenance at £80 per flat for each year of the term. What is the effect of section 20?

  1. Consultation is not required because maintenance contracts are exempt
  2. Consultation is not required because the yearly cost is under £100 Correct answer.
  3. Consultation is required because the total contract value exceeds £250
  4. Consultation is required because the contract lasts more than a year

Explanation

A qualifying long-term agreement is one under which a tenant's relevant contribution exceeds £100 in any accounting period. At £80 per flat per year the agreement falls outside the statutory consultation requirements.

Question 35Service charges: calculation, apportionment, reasonableness and recovery

Under section 20B, a tenant is not liable to pay costs incurred more than how long before the landlord's written demand, unless a written statement of account or demand was given within that period?

  1. Twelve months
  2. Three months
  3. Eighteen months Correct answer.
  4. Twenty-four months

Explanation

Section 20B bars recovery of costs incurred more than eighteen months before a written demand unless, within that period, the tenant received a written statement of account or a demand for payment. The tribunal may grant retrospective dispensation from the bar.

Question 36Service charges: calculation, apportionment, reasonableness and recovery

What document must accompany each demand for a variable service charge?

  1. A copy of the current buildings insurance policy
  2. A breakdown of the landlord's management fee
  3. A summary of the tenant's rights and obligations Correct answer.
  4. A certificate signed by a qualified accountant

Explanation

The prescribed summary of rights and obligations must be given with every demand for a variable service charge. An accountant's certificate is required only where the tenant asks for a certified summary of costs.

Question 37Service charges: calculation, apportionment, reasonableness and recovery

Within what period must a landlord comply with a tenant's written request to inspect the documents supporting a service charge account?

  1. Seven days
  2. Twenty-one days Correct answer.
  3. One month
  4. Fourteen days

Explanation

Section 22 requires the landlord to allow inspection, and to supply copies on payment of a reasonable fee, within twenty-one days of a written request. Failure to comply can support an application to the tribunal.

Question 38Service charges: calculation, apportionment, reasonableness and recovery

Which provision allows a tenant to challenge the share of costs allocated by the lease as unreasonable?

  1. Section 19(1)(a) of the Landlord and Tenant Act 1985
  2. Section 19(2) of the Landlord and Tenant Act 1985 Correct answer.
  3. Section 20 of the Landlord and Tenant Act 1985
  4. Section 21B of the Landlord and Tenant Act 1985

Explanation

Section 19(2) requires the amount payable by a tenant to be reasonable, so a proportion fixed by the lease can be challenged if it is disproportionate. The tribunal may determine the reasonable amount.

Question 39Service charges: calculation, apportionment, reasonableness and recovery

Under Schedule 11 to the Commonhold and Leasehold Reform Act 2002, an administration charge is payable only to the extent that it is:

  1. Supported by a receipted invoice
  2. Specified in the lease as a fixed amount
  3. Reasonable in the circumstances Correct answer.
  4. Approved by the managing agent

Explanation

Paragraph 2 of Schedule 11 provides that an administration charge is payable only to the extent that it is reasonable. The tribunal has jurisdiction to determine reasonableness on application.

Question 40Service charges: calculation, apportionment, reasonableness and recovery

A landlord replaces the roof at a cost of £1,200 per flat but never served the notices required by section 20, and no dispensation has been granted. What is the maximum recoverable from each tenant through the service charge for those works?

  1. £250 per tenant Correct answer.
  2. Nothing at all
  3. £1,200 per tenant
  4. £500 per tenant

Explanation

Where the landlord fails to comply with the consultation requirements and the tribunal does not dispense with them, relevant contributions are limited to £250 per tenant. The balance of the cost cannot be recovered through the service charge.

Question 41Service charges: calculation, apportionment, reasonableness and recovery

A burst water main is flooding the block, so the landlord instructs emergency contractors without serving section 20 notices. How can the landlord best preserve recovery of the full cost from the tenants?

  1. Add the cost to the next ground rent demand
  2. Recharge the cost as an administration charge instead
  3. Apply to the tribunal for dispensation from consultation Correct answer.
  4. Serve the consultation notices retrospectively and then recharge in full

Explanation

Section 20ZA allows the tribunal to dispense with some or all of the consultation requirements where it is reasonable to do so, taking account of prejudice to tenants and any informal consultation. Without dispensation, recovery is capped at £250 per tenant.

Question 42Service charges: calculation, apportionment, reasonableness and recovery

A lease provides that the tenant pays 'a fair and reasonable proportion' of the building's costs, as determined by the landlord. The landlord decides to apportion costs by floor area. Which statement is correct?

  1. The landlord may add a management charge of up to ten per cent of the total
  2. The landlord's determination is conclusive because the lease confers a discretion
  3. The apportionment must be reasonable and can be challenged before the tribunal Correct answer.
  4. The apportionment must follow rateable values in the absence of express words

Explanation

The lease governs how costs are shared, but section 19(2) requires the resulting amount to be reasonable, and the tribunal can determine whether a particular apportionment is reasonable. A contractual discretion is therefore not conclusive.

Question 43Service charges: calculation, apportionment, reasonableness and recovery

Major works costing £20,000 are completed in January and the landlord sends tenants a written statement of account in August of the same year. The first demand for the money is served three years later. What is the position under section 20B?

  1. The cost is recoverable because the tenants were notified in time Correct answer.
  2. The cost is irrecoverable unless the tribunal grants dispensation
  3. The whole cost is irrecoverable because the demand came too late
  4. The cost is recoverable only if the sum is under £250 per tenant

Explanation

Section 20B only bars costs where no written statement of account or demand was given within eighteen months of the costs being incurred. Notification within that window preserves recoverability, even though the demand itself followed later.

Question 44Service charges: calculation, apportionment, reasonableness and recovery

A lease requires annual payments into a reserve fund for future roof replacement. Which statement about those payments is correct?

  1. They cannot be demanded until the works are carried out
  2. They are service charges and must be reasonable in amount Correct answer.
  3. They are capital sums outside the service charge regime
  4. They may be held in the landlord's general trading account

Explanation

Contributions to a reserve or sinking fund are sums payable for future repairs and so fall within the section 18 definition of a service charge. They are subject to the reasonableness test and, for relevant dwellings, must be held in trust in a designated account.

Question 45Service charges: calculation, apportionment, reasonableness and recovery

A landlord insures the block under a policy in its own name and recharges the premium through the service charge. Which requirement applies under section 30A of the Landlord and Tenant Act 1985?

  1. The tenant must be given a written summary of the insurance Correct answer.
  2. The premium must be below the section 20 consultation threshold
  3. The policy must be arranged through an independent broker
  4. The tenants must approve the policy at a general meeting

Explanation

Where the landlord insures under a policy taken out in its own name, section 30A restricts recovery of the premium unless the tenant's interest is protected on the policy and the tenant is given a written summary of the insurance. The other options are not statutory conditions.

Question 46Service charges: calculation, apportionment, reasonableness and recovery

Under the section 20 procedure for qualifying works, how long do tenants have to comment on the landlord's notice of intention?

  1. Three months
  2. Thirty days Correct answer.
  3. Twenty-one days
  4. Two months

Explanation

The notice of intention must invite written observations within thirty days, and the landlord must have regard to those observations before proceeding. Twenty-one days is the period for notifying the award of contract at the final stage.

Question 47Service charges: calculation, apportionment, reasonableness and recovery

During consultation on qualifying works, the tenants nominate a contractor within the permitted period. What must the landlord do?

  1. Accept the lowest of all the estimates received
  2. Disregard nominations made by individual tenants
  3. Obtain an estimate from the nominated contractor Correct answer.
  4. Refer the nomination to the leaseholders' association

Explanation

Where tenants nominate a person within the thirty-day period, the landlord must seek an estimate from that person and include it in the statement of estimates. The landlord is not bound to accept the lowest estimate but must have regard to tenants' observations.

Question 48Service charges: calculation, apportionment, reasonableness and recovery

After a tribunal hearing about service charges, the landlord seeks to add its legal costs to the service charge. What order may the tribunal make under section 20C?

  1. An order that those costs are not recoverable Correct answer.
  2. An order transferring the lease to the tenant
  3. An order that the landlord's costs are recoverable in full
  4. An order reducing the next year's service charge by ten per cent

Explanation

Section 20C allows the tribunal, on application, to order that all or part of the landlord's costs of the proceedings are not to be treated as relevant costs. It limits recovery through the service charge but does not affect the landlord's costs entitlement under the general law.

Question 49Service charges: calculation, apportionment, reasonableness and recovery

A residents' management company carries out the management itself instead of appointing an agent. Which statement about charging a management fee is correct?

  1. A fee may be charged only if an external agent is appointed
  2. A fee may be charged if the lease allows it and it is reasonable Correct answer.
  3. A fee may be charged only with the freeholder's written consent
  4. A fee is capped by statute at ten per cent of expenditure

Explanation

A management fee is recoverable only where the lease authorises it, and the amount must be reasonable. In-house management does not of itself prevent a charge, provided the fee reflects a genuine service rather than disguised profit.

Question 50Service charges: calculation, apportionment, reasonableness and recovery

Communal hallways are repainted, but the finish is already flaking a few weeks later. The landlord has paid the contractor in full. How does section 19(1)(b) affect what the tenants must pay?

  1. They must pay in full and pursue the contractor themselves
  2. They need pay only what is reasonable given the standard achieved Correct answer.
  3. They must pay in full because the landlord has already paid the contractor
  4. They may pay nothing because the works were defective

Explanation

Section 19(1)(b) limits relevant costs to those attributable to works or services of a reasonable standard. Where the standard is poor the tribunal may reduce the amount payable, even though the landlord has already paid the contractor.