RTM conflict of interest

  • Filter
  • Time
  • Show
Clear All
new posts

    RTM conflict of interest

    Dear LLZ members

    I had a few queries that I would be grateful for clarification on, in relation to RTM arrangements.

    -Are representatives of directors of RTM companies allowed to carry out services e.g. gardening, cleaning, for money, or is this a conflict of interest?
    - Under what circumstances can directors and officers be removed from a company?
    -If a representative for a director has had insurance declined previously, and this was not declared to the D&O fact find on initial questioning (given that it is the representative rather than the director), is this something that would void the D&O insurance policy? If so, are there any ways around this situation to ensure that the policy is still valid?

    Thanks in advance for advice

    It is unclear what you mean by representatives, will you please explain,

    The directors should comply with the Articles of the RTM Company, the model Articles 19 state that conflicts of interest should be declared and the director concerned should not participate in the decision making process.

    Directors and officers can be removed by a majority vote at a meeting of .members.

    The proposal form for the insurance should be completed accurately, so you should check it. The reply to your question depends on what you mean by "representatives" and whether or not there is a relevant fact which should be disclosed.to the insurer and which would influence the insurer's decision to accept the risk.You could approach the insurer and disclose the information now if it is relevant. That may result in the insurer declining the risk or increasing the premium but it would be unable to state that it was unaware if and when a claim is made.


      Thanks. I was told that Under Article 10 of the RTM rules apparently a director can delegate their duties and powers to a nominated representative.


        Article 10 is intended to allow directors to form sub committees to report back to the directors and a director to appoint a specific person to act on behalf of that director eg in case of illness or absence. The members of the Company have the power to change the Articles if they so wish,


          The RTM rules are on this link :


          Under clause 24, Directors are not entitle to remuneration.


            Originally posted by shuey View Post
            Thanks. I was told that Under Article 10 of the RTM rules apparently a director can delegate their duties and powers to a nominated representative.
            if you had only one director for 10 flats, He / she can delegate their duties to a) a leaseholder who is an accountant b) a person to engage workmen and ensure the property is well maintained by the tradesmen. c) delegate their duties to other mere mortals at the property for mundane tasks, checking the car park for unauthorised cars, cos the director is out at wsork all day.

            Directors are there to run the property, and not to profit from a director cutting the grass.

            The Director will not have insurance to cover himself if as a result of his gardeing actions, some one is hurt, therefore he should be stopped from acting as a paid tradesman.Directos only delegate their duties as one would in an office. Directors do not put on overalls and do the maintenence work -- end of.


              Section 16 of the RTM Rules :

              Quorum for directors’ meetings

              16.—(1) At a directors’ meeting, unless a quorum is participating, no proposal is to be voted on, except a proposal to call another meeting.

              (2) The quorum for directors’ meetings may be fixed from time to time by a decision of the directors, but it must never be less than two, and unless otherwise fixed it is two.

              (3) If the total number of directors for the time being is less than the quorum required, the directors must not take any decision other than a decision—

              (a)to appoint further directors, or

              (b)to call a general meeting so as to enable the members to appoint further directors.


              Latest Activity


              • Reply to Old managing agents accounts
                by eagle2
                I suggest that you apply to or take action against the freeholder directly, the agent is only acting on behalf of the freeholder. If you think that the freeholder is likely to supply information, you can ask him to volunteer it otherwise you will apply to the Tribunal. If he is unlikely to volunteer...
                26-05-2022, 05:38 AM
              • Old managing agents accounts
                by jazzythumper
                Since obtaining the RTM and changing the managing agent, we have never been given full accounts / receipts for the previous year(s). We believe that as the old freeholder and leaser holder of one of the flats were represented by the same solicitor that prior to the sale of the freehold, we were subsidising...
                20-05-2022, 11:21 AM
              • Reply to Old managing agents accounts
                by jazzythumper
                would this be a good starting point?

                25-05-2022, 15:37 PM
              • Reply to Old managing agents accounts
                by jazzythumper
                As in a simple application to the old managing agent Or freeholder? Which one?

                To provide all accounts and payments based on the fact that we disagree with the charges? How far back can we go? And does having paid the service charges mean we have agreed to these?

                Thanks for...
                25-05-2022, 15:31 PM
              • Reply to Freehold confusion
                by Section20z
                It's never advisable , it can cause serious issues if you have a claim affecting communal areas. For buildings insurance the whole property should be covered and the cost split between the two flats.
                The only problem with an absent freeholder is that when selling the flat a pernickity solicitor...
                25-05-2022, 10:02 AM
              • Reply to Share of feehold/shared service charges?
                by Stu1020

                Thank you for the response.
                25-05-2022, 09:40 AM
              • Reply to Freehold confusion
                by AndrewDod
                There is no cast iron rule that the freehold "share" has to be transferred with any sale. You may need to purchase it from the friend (or his estate)....
                25-05-2022, 09:22 AM
              • Share of feehold/shared service charges?
                by Stu1020
                Hi there,

                I'm new to the forum and looking for advice on a sticky freehold situation.

                I own a two-bed flat in a converted building with two one-beds. The lease states that a fair proportion is payable towards the service charge. However, there has been a running agreement of...
                20-05-2022, 11:39 AM
              • Reply to Share of feehold/shared service charges?
                by eagle2
                I suggest that you ask the other 2 leaseholders to explain why they consider that the current allocation is fair. The freeholder has the right to review the allocation from time to time. Unfortunately, a "fair proportion" means that several alternatives would be considered reasonable to a...
                25-05-2022, 06:27 AM
              • Reply to RTM Hand Over Issues
                by eagle2
                You appear to have a claim against the freeholder, not the individual companies, who are acting as agent for the freeholder. A Tribunal does not have the jurisdiction to deal with monies which should be handed over, it is a matter for the courts,
                25-05-2022, 06:16 AM