Replacing RMC with RTM

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    #16
    RTM is for third party freeholds, RMC is if you and other owners own the freehold - what is the name of the company - look up Companies House and tell us if your name appears as a shareholder

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      #17
      The forum rules do not allow you to identify the parties involved, any attempt to disclose names is likely to result in a swift edit and rebuke from the moderator.

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        #18
        I'll post this below again as my initial comment was spammed, but I can add more now and it seems to get more weird. I'll explain this the best I can.

        Builder / Freeholder built our site in 2006 with approx 20 houses and 2 apartment blocks (4 & 9 = 13 total). They had two limited companies one as the builder with codes '41100 - Development of building projects' and the other which was called (fake name) 'Example' Management Company (limited by shares) with 1 share registered with their accountants. This management company used these three codes.

        43999 - Other specialised construction activities not elsewhere classified
        68209 - Other letting and operating of own or leased real estate
        68320 - Management of real estate on a fee or contract basis

        They were collecting service charges from the apartments only (should also have been houses) payable to Example Management Company but looking at Companies House it appears they handled all of their developments' services charges under the Example Management Company because there was a good £1.9 million in their accounts. Also looking at their Memorandum and AoA, it was not an RMC with no members.

        The builder/freeholder liquidated the freehold building company only, above, in 2012 and the lender became acting freeholder by default and we still pay them ground rent each year via a 3rd party collections company. The lender sold off the remaining 7 apartments for cheap in 2013 and then set-us up an RMC, also in 2013 which now has 7 of 13 tripartite leases referencing this RMC. Mine and five others' on the older tripartite leases (pre-liquidation) references the liquidated Example Management Company. This looks illegal to me not being an RMC, and hence why the reserve fund was never documented and went missing in the liquidation?

        Although they liquidated the building company, the Example Management Company continued to trade (with an immediate name change) until 2017 and then liquidated.

        As an aside, in 2015/16 a new-ish resident to the site established that the houses car park areas and street lights were wired to the smaller apartment block meter and also our apartments management service charge had been paying for gardening for the front of the houses. The electricity was rewired shortly after but our managing agent at the time (appointed by the lender when they became default freeholder in 2013) failed to reclaim back service charges from the houses, they all refused to pay.

        Although incredibly unbelievable and complex that is all correct and hopefully makes sense. I now need to urgently find a solicitor to check through my lease because if I don't have to pay, I won't until the current directors sort this out, reduce the fees appropriately and unite the residents.

        As I do not want to use the solicitor I hired to purchase my apartment I'm not sure where to start, are there any online you can recommend?

        Thanks all.


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          #19
          Post spammed again, always on edit.

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            #20
            Originally posted by Sarah B View Post
            RTM is for third party freeholds, RMC is if you and other owners own the freehold - what is the name of the company - look up Companies House and tell us if your name appears as a shareholder
            The RMC does not need to own the freehold, in our case it is party to the lease, tripartite lease and is responsible for all the management of the development, it does not collect Ground Rent and until recently did not provide insurance.

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              #21
              I just managed to read your post before it was removed, although I have been unable to read it again to check certain points.

              You seem to be saying that the mortgage company has become the freeholder. That involves a transfer of title which may have been agreed by the liquidator or by the court if there was a legal charge which was enforced. At that stage, it is possible that the freehold interest should have been offered to the leaseholders.

              You also stated that your lease was tripartite and the management company mentioned in your lease has also been liquidated. Your lease probably includes a clause that in the event that the management company ceases to exist, its rights and obligations transfer to the freeholder. Please check your lease.

              Please correct me if my understanding of your post is incorrect.

              It would appear that the mortgage company is currently entitled as freeholder to charge you ground rent and service charges. If the mortgage company instructs the managing agent to act on its behalf, the agent can then demand charges from you, subject to the terms of your lease.

              The RMC to which you refer appears to have no rights or obligations in relation to your lease. I can only assume that the mortgage company intends to apply similar rights and obligations but there is no legal requirement and it is not enforceable. You should be concerned that the mortgage company may sell its interest and a new freeholder will take a different view.

              It is a mess and I am not surprised that you are having difficulty selling your apartment. You should definitely seek legal advice.

              You may wish to consider with your solicitor purchasing the freehold, RTM as there is not a RMC representing all the apartments, deeds of variation to make all the leases similar.

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                #22
                Yes, the lender is now the acting freeholder by default but the Land Registry still lists the builder/original freeholder. And that is my major concern that the freeholder will one day flog this site for cheap and the 6 leases not connected to the RMC could be in trouble.

                The freehold was for sale for £112,320 in 2015. As a collective the residents weren't interested. I've since contacted the acting Freeholder (lender) three times (not regarding buying the freehold) by letter and all were ignored, no response. I have phoned and they said to get my solicitor to contact them. I've found out today that one of the residents tried to buy the apartment freehold alone in 2016 and was refused.

                I emailed the management agent this week to see if they have an exclusive separate reserve fund bank account for us with interest, they said "yes" but they haven't sent a screenshot as proof as I requested. In 12 years I've never seen an insurance certificate.

                Also, I've noticed at the start of my lease under the Land Registration Act 2002, the Property location is wrong. The street name is correct, but the main road it is off is incorrect.

                I spoke with the CAB today and they said my Managing Agent can supply me with a Management Pack at a cost which should give me access to a pile of documents that may help me get some clarity. Do you know much about his pack?

                Thanks





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                  #23
                  Excerpts from my Lease below:

                  Lease Between:

                  BUILDER/FREEHOLDER LIMITED (called "the Lessor") of the first part EXAMPLE MANAGEMENT LIMITED (called "the Management Company" of the second part ME (called "the Lessee") of the third part

                  2.1 "the Property" includes and excludes the features described in the first schedule hereto

                  2.2.2 the expressions "the lessor" and "the lessee" include their respective successors in the title and the expression "the lessor" includes the reversioner for the time being immediately expectant upon the Term and the expression "the management company" includes any other company to which the rights and duties of the management company are assigned or transferred

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                    #24
                    When the mortgage company started to claim ground rent from you, did it supply you with proof that it had become the freeholder? If not, I would ask for evidence as you have been unable to confirm with HMLR. It cannot be the “acting freeholder”, the liquidator of the freeholder Company would have sold the freehold interest before liquidating the company. The cost of purchasing the freehold interest should be considerably less now that some of the apartments have been sold.

                    In your lease, there should be sections dealing with the covenants of the management company and the freeholder and one of them should state that if the management company ceases to exist, the covenants will be transferred to the freeholder.

                    A management pack is unlikely to assist you, it will only confirm what you already know that there are two types of lease, there is an RMC in respect of some of the apartments and the managing agent acts partly for the RMC and partly for the freeholder.

                    You are entitled to know the full title of all bank accounts operated by the managing agent. You can also ask to inspect the documents, including proof of insurance.

                    Comment


                      #25
                      In the “eagle2” post 15-02-2019, 16:40 it says
                      It would appear that the mortgage company is currently entitled as freeholder to charge you ground rent and service charges. If the mortgage company instructs the managing agent to act on its behalf, the agent can then demand charges from you, subject to the terms of your lease.
                      The RMC to which you refer appearsto have no rights or obligations in relation to your lease. I can only assume that the mortgage company intends to apply similar rights and obligations but there is no legal requirement and it is not enforceable. You should be concerned that the mortgage company may sell its interest and a new freeholder will take a different view.

                      This was written before Centrino posted a reply with an extract from his/her lease
                      2.2.2 the expressions "the lessor" and "the lessee" include their respective successors in the title and the expression "the lessor" includes the reversioner for the time being immediately expectant upon the Term and the expression "the management company" includes any other company to which the rights and duties of the management company are assigned or transferred

                      I do not profess to have any legal training but as a layman doesn’t the original lease still apply as it says the lease is between
                      "the Lessor (using Centrino’s reference as “BUILDER/FREEHOLDER LIMITED” who presumably originally had the freehold) and any future successors."

                      How can anyone that buys the freehold off “BUILDER/FREEHOLDER LIMITED” then impose different rights as surely the rights that were signed up to by the original lessor to the original lease still apply i.e. any prospective freeholder presumably must take over the freehold on the understanding that it has to adhere to the covenants signed up to by the previous freeholder.

                      Also by similar reasoning surely the RMC also still has rights regarding the original lease as it is now “any other company to which the rights and duties of the management company are assigned or transferred” referred to in the original lease

                      As I see it the original lease is a legal document outlining the covenants that the three original parties agreed to live by and appears to make allowance for the names of the Lessor and Management Company to change. So, presumably, as long as the lessee remains the same then the lease remains the same and presumably the lessee has a right to sell on the apartment with the terms of the original lease unchanged. If this wasn’t the case then when a new prospective buyer comes along the lessor could want to change the lease, specifying more covenants and thus putting off any prospective buyer.

                      Be interesting to see if my “laymans” views have any merit

                      Comment


                        #26
                        Another view is welcome on here.

                        I have already stated that the lease still exists #15. The question is who are the other parties and that is why I asked who is claiming ground rent and service charges #15. The terms of the lease will not have changed but the persons who may make decisions have changed.

                        The freeholder seems to be the mortgage company but Centurino should seek proof #24.

                        We were told #1 that the RMC was set up in 2013 but we have not been told that it has taken over the rights and obligations under the old leases which existed at that time. I doubt it because if that is the case, the RMC would be responsible for the missing funds #9.

                        I am assuming that as the management company mentioned in the lease no longer exists, the rights and obligations have been transferred to the freeholder but Centurino should check.

                        Hopefully, Centurino can obtain some answers at the meeting.

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                          #27
                          Originally posted by Centurino View Post
                          it was not an RMC with no members.
                          I don't understand this. All companies have members.

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                            #28
                            We are told that the original management company was controlled by the freeholder #9 and both companies have been liquidated.

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                              #29
                              Eagle2 #17 - are you the moderator? If not, please stop picking me up for asking rhetorical questions. I was not asking the OP to post the name but they must know it so I was suggesting they can look it up themselves.

                              It's quite possible that the management company has not assumed the freeholder's responsibilities. You really need specialist advice. Please look for a solicitor with leases as a speciality.

                              Comment


                                #30
                                Eagle2 wrote
                                I am assuming that as the management company mentioned in the lease no longer exists, the rights and obligations have been transferred to the freeholder but Centurino should check.

                                We were told #1 that the RMC was set up in 2013 but we have not been told that it has taken over the rights and obligations under the old leases which existed at that time. I doubt it because if that is the case, the RMC would be responsible for the missing funds #9.

                                So if the management company mentioned in the original leases no longer exists you seem to be saying that the rights and obligations of the lease at the point the management companywent into liquidation then transferred to the new freeholder who became a party to the lease as BOTH the freeholder and the management company? Is that correct?
                                If that’s the case, legally, then wouldn’t it be the freeholder who would be responsible for the “missing fund” having inherited it by virtue of it being transferred to him as a result of the liquidation of the companies he lent money to and have failed to meet the agreed repayments?
                                Why and under what legislation would the new RMC be responsible for the missing funds?


                                Whilst this website is a mine of useful information I think that each contributor should confirm in what capacity they express their views. I openly admit that I am a layman and have no legal training ands so my views just seem to be my interpretation of “common sense”.

                                Surely if a contributor were to back up his “views” with reference to relevant legislation then this would be more help but without this it only remains a “view”

                                For example in the replies to this post number 16 say
                                RTM is for third party freeholds, RMC is if you and other owners own the freehold
                                Post number 20
                                The RMC does not need to own the freehold ....

                                If the person looking for advice via this website .i.e. Centrino in this case, then without reference to legislation to back up the views above he/she does still not have an answer as which of the views is correct

                                As you say “eagle2” –
                                Another view is welcome on here
                                But with a caveat that it might not necessarily be correct

                                Maybe the answers to Centrino's problem is summarised in post number 29

                                You really need specialist advice. Please look for a solicitor with leases as a speciality.

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