I own the whole building freehold but a management company exists, Who has control?

Collapse
X
  • Filter
  • Time
  • Show
Clear All
new posts

    I own the whole building freehold but a management company exists, Who has control?

    I own the whole buildings freehold and one of the 4 flats.
    There is a management company which the 4 leaseholders are members but the building is not being managed properly.
    Items such as repairs and communal areas are in poor condition and the other leaseholders are not very cooperative.
    As the freeholder what rights do I have to enforce repairs and cleaning and recover the costs from the other leaseholders?

    It is not the usual situation where all leaseholders might own an equal share of the freehold.

    #2
    Hi megaspooner1

    You will need to provide further information.Is the management company a RTM company?
    How long have you owned the freehold?
    Do you let your flat or live there?
    Is the building purpose built?

    Comment


      #3
      Provide a little more background too for context.

      Comment


        #4
        Hi It is a RTM company.
        I have owned the freehold and flat since 2007
        I do not live there and the building is not purpose built it is a 1870 conversion
        I collect ground rents and arrange insurance but repairs and cleaning are not being agreed by the other leaseholders and the building is deteriorating

        Comment


          #5
          What does the lease say? Who is responsible for arranging works?

          Comment


            #6
            My lease says that the Lessor
            clause 4.3
            "To repair and keep in repair (at the expense in the proportion aforesaid) all the retained parts PROVIDED that when any works or repairs are necessary which exceed in cost the sum of Fifty Pounds two estimates shall first be obtained and submitted for the approval of the lessees of all the flats in the property and also for the approval as to the date of commencement of the work(which approvals shall not be unreasonably withheld) IN the event of the said Lessees not being unanimous in giving their approvals within four weeks of having been supplied with a copy of each of the said estimates the decision of the Lessor shall be final and binding on all the Lessees PROVIDING that in the case of an emergency the Lessor shall be entitled to proceed immediately with such work and expenditure and bind the Lessees accordingly"
            the proportion payments are one quarter per flat.
            So does this overide the RTM companies rights to?

            Comment


              #7
              This has come up in another recent thread. I think it was concluded that it is very difficult for a freeholder to deal with with an incompetent RTM other than by having a tribunal appoint a manager, which will temporarily remove control from both RTM and freeholder, and will be expensive for the leaseholders. In that case, there was a question that RTM might have been invalidly approved in the first place, because of a commercial element in the development, but that doesn't even apply here.

              The problem is that an RTM generally comes into existence because leaaseholders don't like how the freeholder is managing and it has statutory rights which override those of the freeholder.

              As freeholder, you do have a right to be a member of the RTM, but you only get one vote in general meetings, so you will need to find enough of the leaseholders who are not apathetic, or like the low service charges they are probably getting, to make a quorate majority in a general meeting, which would be needed to remove the current directors. Also note that a meeting to that must state the purpose, so a director who wants to say may try to drum up proxies and attendance from the normally apathetic.

              Have a look for the above mentioned thread

              This is the opposite side to the issues with leasehold where freeholders are abusing it as a cash cow. Enfranchisement often leads to mismanagement.

              Comment


                #8
                The clause you quote doesn't override the RTM's rights; rather it imposes obligations on the RTM, as they take on the maintenance duties that previously fell on the freeholder.

                Comment


                  #9
                  Thanks for your input I will read that with interest.
                  My first job is to instruct a cleaner for the communal areas at a sum of £25/month shared and as that is below the £50 limit in the lease before estimates need to be obtained .
                  Can this be enforced on the leaseholders with no waiting 4 weeks for their approvals?

                  The lease states that if not unanimously agreed then the Lessor`s decision is final and binding for works costing more than £50.so I assume works under £50 can just be carried out and leaseholders billed.
                  I just want to make the building a better place for all !

                  Comment


                    #10
                    Only the RTM can appoint the cleaner. (Well you could appoint the cleaner, but you would have to pay out of your own funds.)

                    In the clause you quote, you need to replace Lessor by RTM to incorporate the effects of creating the RTM.

                    It's unfortunate that there is no provision for inflation in the lease, but I would consider that, morally at least, this is one annual contract for £600, rather than twelve contracts for £25. The RTM might get away with this subterfuge, but I don't think that is the intent of the lease.

                    Comment


                      #11
                      It would probably be advisable for you to obtain a copy of the tribunal ruling appointing the RTM. It really should have been given to you.

                      However, I think it will completely remove maintenance responsibility from you.

                      Comment


                        #12
                        You stated you arrange insurance. Usually, the RTM is responsible for insurance as all day-to-day management responsibilities pass to the RTM. Do the others pay their respective share of insurance?

                        What are lease terms re insurance?

                        You may like to read the other thread referred to post #7 as there may be useful information and signposting; see:
                        https://forums.landlordzone.co.uk/fo...failing-rtm-co

                        Comment


                          #13
                          Hi megaspooner, i am the freeholder from the other thread and I think you need to look to replace the directors of the RTM with people with more of a responsible attitude to maintenance. Check the articles of association of the RTM (from companies house) for details of how directors should be appointed...

                          Comment


                            #14
                            Originally posted by Section20z View Post
                            Hi megaspooner, i am the freeholder from the other thread and I think you need to look to replace the directors of the RTM with people with more of a responsible attitude to maintenance. Check the articles of association of the RTM (from companies house) for details of how directors should be appointed...
                            All RTMs have to have essentially the same articles: http://www.legislation.gov.uk/uksi/2...ulation/2/made The actual articles are in the schedule. Even companies formed before this SI must now use the articles it contains.

                            Comment


                              #15
                              The Law Commission is considering whether it should be mandatory for RTMs to appoint a professional managing agent and whether RTM directors should be required to meet training requirements.

                              Comment

                              Latest Activity

                              Collapse

                              • Underlet registration fee
                                Relentlessuk
                                hi,

                                My freehold management company, also known as the Devil, {Mod - name removed}, are requesting an £138 underlet registration fee from me. I realise its been discussed umpteen times but thought if I post the clause (attached) they are relying upon I might find someone with a better mind...
                                02-08-2019, 19:02 PM
                              • Reply to Underlet registration fee
                                eagle2
                                The solicitors are correct, the LVT does not have the power because it ceased to exist in June 2013.

                                The FTT would also not have the jurisdiction to consider the charge because it is not a variable administration charge, you have the right to choose a fixed fee of £5 as stated by Lawcruncher...
                                20-08-2019, 04:47 AM
                              • HELP - lease clause
                                Jake0254
                                Hello

                                Im due to complete on Monday which is the scariest part of this. I have a house cat. My lease is POORLY worded with a clause that says:

                                " No pets may be kept in a flat and where the property is a house you must not keep any animal including livestock except a pet...
                                16-08-2019, 23:15 PM
                              • Reply to HELP - lease clause
                                HazeltonLane
                                The property agent told you you can get consent for a house cat.

                                Your solicitor told you the lease says cats can be kept with consent.

                                The HA told you that they would grant permission pending the information provided. Presumably they want to reserve the right to refuse if you...
                                20-08-2019, 01:17 AM
                              • Reply to Underlet registration fee
                                leaseholder64
                                The power seems to have existed since September 2004, which is before the FTT replaced the LVT (Commonhold and Leasehold Reform Act 2002, Schedule 11).
                                19-08-2019, 21:27 PM
                              • Reply to HELP - lease clause
                                Jake0254
                                Yes that’s right, he interprets it the same way as the HA do - the HA have clarified their position that it is, in their opinion, a blanket ban on pets in flats. The solicitor would therefore then argue that such a term would be considered unfair and therefore not legally binding....
                                19-08-2019, 20:55 PM
                              • Reply to HELP - lease clause
                                Jake0254
                                I have already researched that case actually - the question in that case is whether the management company was reasonable in its refusal. This is quite different to this situation, whereby a blanket ban (which the HA are implying they have) allows no potential special circumstances to be taken into...
                                19-08-2019, 20:52 PM
                              • Reply to Underlet registration fee
                                Relentlessuk
                                Well its been two weeks and they still haven't responded to my request for the freeholders solicitors details. we shall see what happens....

                                they did send previously a templated response saying that "the LVT does not have power to rule that a registration fee is unreasonable"....
                                19-08-2019, 19:36 PM
                              • Reply to HELP - lease clause
                                Macromia
                                My comment regarding livestock was intended to be tongue in cheek!
                                I think that you'd have to be more specific than "indoors" though - factory farmed livestock might not see anything other than the inside of a building until loaded into a cramped truck to be taken for slaughter.
                                ...
                                19-08-2019, 18:29 PM
                              • Reply to HELP - lease clause
                                AndrewDod
                                I tried to post a bunch of medical links on the health effects of cats in buildings to others in the building. But seemingly if you have more than a few links your post gets killed.

                                Anyway, I'm with jpkeates (and most others) on this one. Perhaps OPs solicitor will help out with the 70K...
                                19-08-2019, 16:34 PM
                              Working...
                              X