Faithorn Farrell Timms LLP

Schedule 3 Notice for Cyclical and Capital Works

the project

FFT were appointed by London & Quadrant to provide Contract Administration Services for the delivery of the Cyclical and Capital Works delivered by Interserve under a JCT Measured Term Contract.

An integral part of this role was the issue of the Schedule 3 Notice of Intention for Qualifying Works under a Qualifying Long-Term Agreement to all leaseholders on the programme for the financial year 2019/2020. This was to enable L&Q to comply with their obligations as a Landlord to undertake compliant Leasehold Consultation and for them to recharge their leaseholders for works undertaken. This consultation was required in a timely fashion in order to enable Interserve to commence programming the works without delay.

our role

FFT drafted two Schedule 3 Notices for Qualifying Works under a Qualifying Long-Term Agreement, for both cyclical and capital works, and included a comprehensive Frequently Asked Questions section designed to address many of the common leasehold queries. We received the mailing list from L&Q and the estimated block costs directly from Interserve and created data sets in a format which collated the relevant estimated block costs for each address. For the cyclical works this comprised four components; asbestos; internal communal works; external works and access and for the capital works this comprised two components; capital works and access. For both programmes of work, VAT was applied and a management fee was calculated on the cost of the works only.

The drafted Notice was issued to our client for review and approval before issue to the mailing house, along with the collated mailing list and associated costs. All personal data was received and issued via our secure Asset Portal to ensure General Data Protection Regulation compliance.

We created an observation log that comprised all addresses on the mailing list. The purpose of this was to ensure we could advise Interserve of any blocks where no observations had been received at the end of the consultation period, therefore enabling them to programme these blocks without any delay.

We received and responded to all observations, many of which were very detailed and seeking a great deal of information relating to the Qualifying Long-Term Agreement consultation that had taken place in 2011, along with sinking fund balances and more probing details regarding the way in which the estimated block costs had been calculated. At the conclusion of the observation period, we issued a copy of the completed observation log to L&Q for their records.

the challenges

Data was received from several different sources, each of which were in differing formats not compatible with the mail merge fields within our Notice. In order to successfully populate the final Notice, data relating to names, addresses and estimated block costs had to be combined and cross referenced for accuracy. In addition, much of the initial data received from Interserve was inconsistent and required a considerable amount of time highlighting blocks which we considered lacked the required level of information.

A considerable number of detailed and probing observations were received from the leaseholders. As the Qualifying Long-Term Agreement had been entered into in 2012, and prior to a merger between East Thames and L&Q, a large number of leaseholders required additional information and evidence that competitive tendering had taken place at this time. There were numerous requests for information pertaining to the sinking fund balance, technical information regarding the works to be undertaken, additional detail regarding the estimate calculations and questioning why the work is required to be undertaken based upon the current condition of the block. Many of the observations received were on the back of responses issued as the level of detail requested intensified. In one block, an active Residents Association approached their local councillor regarding the proposed works which culminated in an MP's enquiry being received by our client and subsequently sent to FFT for a response.

the solution

FFT met with representatives from Interserve to understand the how the block estimates had been calculated and to provide Interserve with an agreed spreadsheet format for them to populate with the required information to prevent the block costs being allocated to the incorrect addresses. This proved to be an invaluable exercise as ensured that all data was ultimately in one format as this was relied upon for populating the Notices and referring back to during the observation period.

In order to manage the large volume of observations received, we provided a dedicated administrative support, who was responsible for the logging and recording of all observations including a summary for the observation log, and a Procurement Manager with Leasehold Management experience, who responded to all observations. On occasion, FFT were requested to make contact with leaseholders by phone which resolved many enquiries promptly as the message is often easier to convey in conversation. In order to ensure transparency in the process, all conversations were also followed up in writing for the leaseholder.

FFT liaised extensively with L&Q's Homeownership Team to obtain sinking fund balances and, where possible, block apportionment's, as a common theme in the observations was the request to understand exactly what the individual contribution was likely to be. Furthermore, FFT sought greater detail from Interserve regarding the surveys undertaken to measure the works and consequently were able to provide leaseholders with an accurate breakdown of the estimated costs for each area of work within their block, which did alleviate many concerns received.

A large number of observations were received from the same blocks and included Resident Association representation, therefore FFT undertook additional site surveys of these blocks to validate the estimates submitted. As a consequence of a number of these visits, FFT recommend to L&Q that they may wish to consider moving the blocks to a subsequent year in the programme.

added value

FFT spent a considerable amount of time in liaison with Interserve in order to resolve specific block estimate queries and obtain further detailed cost breakdowns which could be shared with leaseholders. This relationship and joint working proved to be invaluable in resolving a number of the observations received.

The additional site visits were undertaken to fully appreciate and understand the leaseholders concerns and following these visits, and upon L&Q's instruction, FFT drafted and issued a letter advising leaseholders that their block had been removed from the programme for 2019/20.

Due to the volume and level of concern expressed in the observations, FFT continued to respond to enquiries received after the observation period has closed. This was in part to deal with follow up responses but also the desire to ensure that, as far as possible, leaseholders issues had genuinely been considered and addressed.