Flat owners in Courtlands, off Sheen Road, showed the way as they overturned the directors' attempts to flout the law.
The tenant agreement was to pay for any work on the estate up to the value of £250, from a service charge fund.
If work costs more than £250, tenants should be consulted in accordance with the Service Charges Regulations 2003, otherwise money from the service charge funds could not legally be used.
The Leasehold Valuation Tribunal found on January 12 that the redecoration of two of the blocks, garden maintenance works and replacement lifts in two other blocks were above the £250 threshold. The tribunal came to the conclusion that the directors had not consulted the tenants and therefore, cash must be repaid to the tenants.
Replacement lifts on the estate came in at more than £200,000 for the 238 flats which amounts to around £1,000 for each flat.
Tenants can claim back £750 each. With each piece of unconsulted work, the amount increases. The redecoration cost in the estate was more than £70,000 and garden maintenance was a large bill of £65,793.
Roger Cummins, a Courtlands resident for 21 years, started up the Concerned Residents of Courtlands (CROC) when he saw the problems in July 2005. He said: "We have a service charge which is used for work the directors think is necessary but before they can expend any money over £250 for each flat they have to consult us and take note of the opinions.
"If they do not, they can only recover that amount per flat.
"Now for the 10 directors, things are not looking too comfortable. They wrongly believed they were above the law."
CROC issued a number of letters to the directors reminding them of the regulations required by law, but none were heeded.
The case came before a tribunal when Courtlands Estate tried to claim exemption for the work carried out which was only allowed in an emergency.
The judgement of the tribunal reads: "It cannot have been Parliament's intention that landlords could routinely bypass the 2003 regulations by persuading a tribunal or court they had made an honest mistake or had complied with the spirit of the law."
It added: "The applicant (Courtlands) had no excuse for non-compliance."
In its defence, Courtlands said it had informed residents of work going on and had treated one job as three individual jobs to bring the cost down to under the threshold.
Mr Cummins added: "I feel very depressed - managing blocks of flats should be a routine business.
"This has generated something big out of something which was quite routine.
"This judgement is a terrible warning to all blocks of flats in Richmond. It should never have happened."
Residents have to put in their claims before they will receive their money.
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