Does Freeholder majority need to be 75% in order to pass changes?

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    Does Freeholder majority need to be 75% in order to pass changes?

    Hi guys,

    This is my first post on the forum and it's also my first problem with my first property. So please forgive me if what I am saying is obviously solvable or unclear.

    We recently had some major works completed, it cost way more than was required, legal action was taken and legal action failed. The Ground floor freeholder rents out his apartment, there are 3 apartments in the building with each building belonging to a different freeholder.

    There are 4 registered freeholders, 2 in the 1st flat, 1 in the 2nd flat and 1 in the 3rd flat and the split of the building owned is 33%. So the ground floor freeholder was very adamant in dismissing the case against the contractor, myself and the other freeholders were not really sure why. Anyway, regardless, I dismissed the legal case as it came to light I was unlikely to win without his support. It now turns out he has a number of buildings managed by the managing company that was overseeing these works.

    Now I don't want to conclude that this freeholder is receiving some backhand payment of some sort. But what I do know is that I want to move away from the Managing agent, and the 2 freeholders based in the first flat are in agreement with myself.

    So that would amount to 3/4 freeholders agreeing to change to a different managing agent, however the ground floor freeholder has stated that you need at least 75% to pass this change and the percentage of votes is not based on the number of freeholders but what ownership of the building is.

    So for example, 66% of the building is in favour of changing managing agents, but we need 75% to pass this change, so in theory this would not pass because of the other 33% disagreeing.

    Is this correct? I'm really confused if so, I thought it was based on what the freeholder majority is, which would be 75% in favour in this case.

    We have no actual freehold company set up as it's all done by a managing agent, so I'm very confused on what is right and what isn't. This freeholder is basically blocking our ability to move away from this managing agent which has caused so many issues and cash.

    #2
    In case I answer the wrong question... I take it everywhere you say "freeholder" you mean leaseholder with a share of interest in he freehold? Though not by a company? The old adage is the freehold is never divided, you just have a part interest in it, innit.

    Where you say "each building" belongs to a different "freeholder" you mean each flat is owned by a different leaseholder? If not, ignore the rest here as I got confused after Hi...

    If I understand it right, your building has 3 flats. Each flat has a 33% shared interest in the freehold. Flat 1 has joint leaseholders, flat 2 has one, and flat 3 also has one. The ground floor leaseholder sublets his flat.

    No idea who took legal action but it failed.

    The GF leaseholder has an external relationship with the managing agents.

    The other 2 flats want to change the agents.

    You do not have a freehold company? So presumably you have ownership interest via a trust with your names all on the title?

    Do you have a Participation Agreement? If you don't have a company, then company law can't help. The lease might say something about voting powers?

    I cannot see how some arbitrary unachievable percentage can be created, or from where, if each flat holds 33% share of title? Usually joint 'shares' count as one vote. One vote per flat. Sometimes companies have more interesting voting block rights. Not relevant here, no.

    Sorry, no idea what to suggest - unless there is a codified document that sets out how voting is done I can't see where your neighbour comes up with 75%? You could come with 65% on that basis?

    Anybody can spout anything. Demand he/she puts up or shuts up and two flats outvote one. But read everything first. He/she might have some dusty old parchment that the rest have lost.
    Do not read my offerings, based purely on my research or experience as a lessee, as legal advice. If you need legal advice please see a solicitor.

    Comment


      #3
      Sorry for the late reply. Continuing to have a headache with this! Sorry my question isn't that clear, this is all so new to me and I'm being ran around the bushes with this. I appreciate your response majorly, I'm going to do as much investigation as a I can and see what I can find. If there isn't anything then I should propose a vote about managing it ourselves as we are getting royally screwed by the leaseholder in the GF.

      yes we all have our names on the title as confirmed by the land registry as well. I do not believe there is a codified document that exists and I will also need to check the lease.

      Comment


        #4
        If you are joint tenants, as appears to be the case, and there is no trust deed, you need 100% agreement to take action in your role as a trustee of the freehold. Without a deed of trust, such arrangements are unworkable if you cannot get consensus.

        As a leaseholder, you have a right, under Landlord and Tenant law, to ask the FTT to rule on reasonableness and payability of service charges. You also have the right to ask the FTT to appoint a manager, but this is not the same as appointing a new managing agent, and is likely to be rather expensive. Even a single leaseholder can exercise those rights.

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