RMC hi-jacked

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    RMC hi-jacked

    If there is only one existing director of the company and that director is causing problems, to avoid being 'director-less' can that one director be removed by voting in new directors first and then voting out the problematic director (at the same meeting)?


    ******

    Got this reply from FOS333


    Hi,

    If you are not connected to the OP it maybe best starting your own thread.

    Do the articles state any minimum number of directors are required?

    If you vote in two new directors is there a need to remove the existing director?


    *******

    My response:


    Hi, sorry I will start my own thread. Apologies to the OP.

    There is only one director who has hi-jacked the RMC and appoints her own company as Managing Agent). Leaseholders/members are threatened and abused in many ways and maintenance is not done. Rogue sole Director has to go in order to regain control of our RMC and to enable appointment of different, functioning Managing Agent.

    #2
    If there is only one existing director of the company and that director is causing problems, to avoid being 'director-less' can that one director be removed by voting in new directors first and then voting out the problematic director (at the same meeting)?

    Comment


      #3
      Hi,

      If you are not connected to the OP it maybe best starting your own thread.

      Do the articles state any minimum number of directors are required?

      If you vote in two new directors is there a need to remove the existing director?

      Comment


        #4
        Hi, sorry I will start my own thread. Apologies to the OP. (There is only one director who has hi-jacked the RMC and appoints her own company as Managing Agent). Leaseholders/members are abused and maintenance is not done).

        Comment


          #5
          Yes, you may appoint additional directors and then remove a director at the same meeting

          Comment


            #6
            Originally posted by Travant View Post
            There is only one director who has hi-jacked the RMC and appoints her own company as Managing Agent). Leaseholders/members are abused and maintenance is not done).
            You need to check the articles and see if there is any minimum number required, some only require one director.

            Other restrictions may be contained in the articles, you mention the current director appoints her own company as managing agent, is this director an owner (member) of the RMC and is there a requirement to be so in the articles?

            I have seen where directors of managing agents, where they are also company secretary appoint themselves as a director of the RMC, even though if the articles were checked it can be seen that they have no right to be so.

            Also how many members are there and which articles are in place?

            Comment


              #7
              Originally posted by fos333 View Post

              You need to check the articles and see if there is any minimum number required, some only require one director.
              The minimum number of Directors is stated in the articles is one.

              Originally posted by fos333 View Post
              Other restrictions may be contained in the articles, you mention the current director appoints her own company as managing agent, is this director an owner (member) of the RMC and is there a requirement to be so in the articles?
              This Director is an owner of at least 4 of the properties so is a member of the RMC. Reading the Articles of Association, as I understand it, an existing Director can appoint a Director who is not a 'qualified person' - I take this to mean an existing Director can appoint someone who is not a member, but members cannot appoint a Director who is not a member.

              Originally posted by fos333 View Post
              I have seen where directors of managing agents, where they are also company secretary appoint themselves as a director of the RMC, even though if the articles were checked it can be seen that they have no right to be so.
              The Director of the RMC is also a shareholder (1 of 2) of the Managing Agent. The Managing Agent is also the Secretary of the RMC. The Director of the RMC and the Managing Agent are *closely related* and work together to exclude the General Membership of the RMC to the extent that the members have become powerless.

              Only minimal maintenance is undertaken and to a poor standard. Urgent maintenance is not undertaken unless you are a member of their favoured 'inner circle' of cronies. Any member who 'challenges' them is met with bullying, vindictive persecution, threats, solicitor's letters and 'fines' (charged to their service charge account and then immediately reported to their Building Society as being in 'arrears'). Requests for general meetings are ignored as are any request for information. We have no idea what our service charge money is being spent on because they ignore requests for sight of the accounts.

              The RMC and Managing Agent have no telephone number and share an email and PO Box address. Any emails are ignored unless they think that they can use something contained therein as a stick to beat you with.

              Originally posted by fos333 View Post
              Also how many members are there and which articles are in place?
              There are 65 members. (A mixture of leasehold flats and Freehold houses with a leasehold element for grounds maintenance).

              The Articles in place are:
              Table A in the schedule to Companies Act 1985
              Clauses in the table that shall not apply are 24, 64, 73, 74, 75, 80, 81(e), 95, 97, 102-108 and 110.


              Edited to add: the RMC Director is in breach of many (if not all) of the RMC responsibilities under the lease.

              Comment


                #8
                If under Table A is there mention in the articles of holding an AGM?

                You say the members are powerless but there are 65 members, how many want change and how many are willing to offer to be directors of the RMC. How many are willing to support those who will volunteer to be directors?

                If there is no mention of an AGM in the articles I would look at obtaining the support of the members to call for a General Meeting to be held to appoint more directors.

                For other issues of bullying, "fines" leading to being reported for being in arrears and not knowing what the Service Charge collected is spent on, this requires you checking your lease, does it allow for administration charges? What does the lease say regarding the Service Charge accounts, audited or certified? When are they issued and to who?

                Does the managing agent belong to a redress scheme?

                Lastly "as I understand it, an existing Director can appoint a Director who is not a 'qualified person' - I take this to mean an existing Director can appoint someone who is not a member, but members cannot appoint a Director who is not a member."
                What do the articles actually say and what paragraph has been amended?
                Last edited by fos333; 13-03-2021, 17:18 PM. Reason: Took out the quote

                Comment


                  #9
                  Originally posted by fos333 View Post
                  If under Table A is there mention in the articles of holding an AGM?
                  In the articles it says that all Directors of the Company must retire at each AGM. However, as I understand it, companies are no longer required to hold an AGM regardless of what the articles might state. So, there are no AGMs and GMs are not held (at least one's that the general membership are invited to) despite requests for a general meeting from members.

                  Originally posted by fos333 View Post
                  You say the members are powerless but there are 65 members, how many want change and how many are willing to offer to be directors of the RMC. How many are willing to support those who will volunteer to be directors?
                  Originally posted by fos333 View Post
                  If there is no mention of an AGM in the articles I would look at obtaining the support of the members to call for a General Meeting to be held to appoint more directors.
                  I have no access to member's contact details - I can ask the MA to send them to me, but I know that they will ignore any such request. Most of the flats and houses are tenanted. I am in touch with a few members, but not enough to make a difference and, to be honest, it would be hard to know who could be trusted if any new contacts are identified. I know of members who are actively afraid of these two people and others who have sold their flats to get away from the situation. None of the members that I do know have any experience of Directorship of RMC. Also, it is highly unlikely that the Director of the RMC would co-operate in a hand over.


                  Originally posted by fos333 View Post
                  For other issues of bullying, "fines" leading to being reported for being in arrears and not knowing what the Service Charge collected is spent on, this requires you checking your lease, does it allow for administration charges? What does the lease say regarding the Service Charge accounts, audited or certified? When are they issued and to who?
                  The lease says under the schedule relating to 'the Companies Management Duties":
                  12. "the Company (RMC) is to pay the costs of any Managing Agents appointed by the Company."
                  14. include in its service charges provision for any other expenses which are necessary for the Company to observe its Management Duties.

                  I think they must use either of the above clauses to add so called 'admin costs' to individual leaseholders if they are accused by the RMC of causing the MA to spend time on admin or the RMC send them a solicitor's letter. The clauses are abused by the RMC and MA to punish any individual leaseholder who challenges them in any way and to hold the leaseholders at bay for fear of being landed with these charges.


                  Originally posted by fos333 View Post
                  Does the managing agent belong to a redress scheme?
                  The MA was taken to court by Trading Standards for refusing to join a redress scheme. The MA lost the case and the 3rd appeal is under way. In the meantime the Director of the RMC is ensuring that everything is under the banner of the RMC in order to shield the MA from any future redress cases.

                  Originally posted by fos333 View Post
                  Lastly "...as I understand it, an existing Director can appoint a Director who is not a 'qualified person' - I take this to mean an existing Director can appoint someone who is not a member, but members cannot appoint a Director who is not a member..."

                  What do the articles actually say and what paragraph has been amended?
                  The articles actually say:
                  17. Subject to the provisions of Article 23 hereof no person shall be qualified to be a Director unless he is a *qualified person either alone or jointly with any other person or persons or he is approved by resolution passed by the Directors and the office of Director shall ipso facto be vacated if the Director ceases to be a qualified person or in the case of a Director who is not a quaified person, the Directors pass a resolution removing their approval of that Director.

                  (Article 23 refers to 'governing directors' which are set up by the original developer to hold office until such time as permanent members have a meeting and vote in their own directors.)
                  * I think a qualifying person is a member/shareholder.

                  Comment


                    #10
                    If the only provision stated is that one or more directors are to retire at an AGM then you may not be in a position to enforce it. Any provision that expressly requires the company to hold an AGM would still be enforceable IMO as stated here;

                    https://www.legislation.gov.uk/uksi/...agraph/32/made

                    Aren't details of the members/shareholders available from Companies House?

                    If you can't enforce an AGM you can still requisition a GM with support (3 other members) however unfortunately if other members/shareholders aren't willing to stand as volunteer directors you will not be able to change anything.

                    Members/shareholders own the company but appoint volunteer directors to make the decisions, even if you do have volunteer directors you will still need the support of the other members/shareholders to form a majority.

                    The issues you raise come under different hats and have a different legal recourse;

                    https://arma.org.uk/downloader/f1s/2...d_RMCs_V01.pdf

                    Comment


                      #11
                      Unless the members have passed a resolution to the contrary, the Company should be holding AGMs.
                      Members holding more than 5% of the voting rights (4 in your case assuming each member has one vote) also have the right to require the director to arrange an EGM under s303 CA 2006.
                      Paragraph 76 of table A explains how members may propose the appointment of new directors.
                      Members have the power to remove a director by ordinary resolution.
                      You have the right under s116 CA 2006 to inspect and obtain a copy of the register of members.

                      Comment


                        #12
                        Originally posted by eagle2 View Post
                        You have the right under s116 CA 2006 to inspect and obtain a copy of the register of members.
                        You'll still need to understand the issues you have raised are under different hats, have a look at the following link;

                        https://nearlylegal.co.uk/2019/05/we...ifferent-hats/

                        Comment


                          #13
                          If the purpose of inspecting the register is to arrange a meeting and appoint or remove directors, it is clearly a Company matter.

                          Comment


                            #14
                            Originally posted by fos333 View Post
                            If the only provision stated is that one or more directors are to retire at an AGM then you may not be in a position to enforce it. Any provision that expressly requires the company to hold an AGM would still be enforceable IMO as stated here;

                            https://www.legislation.gov.uk/uksi/...agraph/32/made
                            I can't find anything in the Articles that says an AGM must be held, only that "all Directors of the Company shall retire at each AGM but will be eligible for re-election". So, I have to assume that AGMs cannot be enforced which means that unless an AGM is held voluntarily, there is no opportunity for the retirement and election/re-election of Directors.

                            Originally posted by fos333 View Post
                            details of the members/shareholders available from Companies House?
                            The Companies House page for this RMC is not kept up to date by the Director. The last time a full members list was published on the Companies House web site was in 2016 and even then contact details were omitted. Therefore, the only available list of members is incomplete and out of date.

                            Originally posted by fos333 View Post
                            you can't enforce an AGM you can still requisition a GM with support (3 other members) however unfortunately if other members/shareholders aren't willing to stand as volunteer directors you will not be able to change anything.

                            Members/shareholders own the company but appoint volunteer directors to make the decisions, even if you do have volunteer directors you will still need the support of the other members/shareholders to form a majority.
                            Yes, we could requisition a GM. However, that would involve trying to find out the identity and contact details of every leaseholder (the majority of the residences have tenants in situ). I have asked the RMC and MA for the list of members and their contact details. However, as with anything we are entitled to by law, the request is ignored.

                            There are potentially volunteer Directors, but this goes much deeper than that. There is no way that the essentials (or anything else) for running the RMC would be handed over by the present sole Director. This person would simply not co-operate and neither would their relative, the MA. This would leave the housing development and the Company in limbo, with no funds to go forward with financial obligations, maintenance and administration of the site.

                            These people simply ignore the law as well as their obligations under the Company Articles and the lease.

                            I am sorry if I sound defeatist, but the reality is that these people have everything covered and also hold the trump card of being able to charge individual members for their legal fees via their individual service charge accounts. We are talking about organised and intentional abuse of their carefully engineered positions.

                            Originally posted by fos333 View Post
                            issues you raise come under different hats and have a different legal recourse;

                            https://arma.org.uk/downloader/f1s/2...d_RMCs_V01.pdf
                            Thank you for this link - useful information. Is this just guidance or is it enforceable? The two parties clearly ignore it either way.

                            Comment


                              #15
                              Originally posted by eagle2 View Post
                              Unless the members have passed a resolution to the contrary, the Company should be holding AGMs.
                              Unfortunately, there is no way to find out if members have passed a resolution to the contrary - as far as I know, meetings for the general membership are not held. However, I have recently obtained minutes to a meeting held a couple of years ago. I was not invited and assume that neither was the general membership. These minutes I have obtained were not circulated to the general membership, only selected members (ie only members they think won't challenge them in any way).

                              The only people at this meeting was the Director, Secretary (Director's close relative and also the MA) and two of their carefully selected cronies which I can only assume act as 'useful idiots' to put their hands up for resolutions when instructed to do so by their 'masters'. In return, 'favours' are granted to these 'useful people', such as maintenance to their houses which are in fact Freehold (with a leasehold element with regard to the grounds on the site) and therefore not entitled to maintenance from company funds or maintenance regarding their flats (which should not be a 'favour', but in this situation actually is a favour because anyone outside of their inner circle cannot even get urgent maintenance done and are vindictively 'punished' if they pursue a request for maintenance).

                              So, it is entirely possible that such a resolution was passed, though there is no way for me to find out if this was the case.

                              Originally posted by eagle2 View Post
                              holding more than 5% of the voting rights (4 in your case assuming each member has one vote) also have the right to require the director to arrange an EGM under s303 CA 2006.
                              Unfortunately, they ignore the law and any requests backed up by it. Even if they co-operated (they won't'), they cannot be trusted to have contacted the entire membership.

                              Originally posted by eagle2 View Post
                              76 of table A explains how members may propose the appointment of new directors.
                              Members have the power to remove a director by ordinary resolution.
                              This is useful and I do appreciate it. In normal circumstances we could do this to remove the Director, but there is nothing 'normal' about the situation.

                              Originally posted by eagle2 View Post
                              have the right under s116 CA 2006 to inspect and obtain a copy of the register of members.
                              Again, thank you. But they don't take any notice of the law or requests backed up by the law.

                              I do appreciate any information offered and will use the laws you quote as references to how things should work.

                              Comment

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