Qualifying long-term agreement

Common examples are a managing agent's contract, a lift maintenance contract or a cleaning contract that runs for more than a year, or rolls on automatically.

When you must consult

If any one leaseholder's contribution to the agreement would be more than £100 in an accounting period, you must consult before signing. The steps are similar to those for works: a notice of intention, proposals (at least one from someone unconnected), and observations.

A simple way to avoid it

Many small blocks keep contracts to 12 months or less, so they're not long-term agreements at all. Check for automatic renewal clauses that could make a contract last longer.

If you don't consult when you should have, each leaseholder's contribution is capped at the threshold unless the tribunal grants dispensationDispensationAn order by the First-tier Tribunal excusing a landlord or management company from some or all of the Section 20 consultation requirements, where it is reasonable to do so..