Three party lease - for service charge demands, who is the landlord?

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    Three party lease - for service charge demands, who is the landlord?

    I have a three party lease between freeholder, resident management co ltd and lessee.
    Ground rent demands collected by agent of freeholder and are sent in the correct format.
    RMCo uses Managing Agent to manage building and to collect service charge monies.
    Service charge demands contain the name of the RMCo Ltd as being the landlord. Is this correct?

    I am aware of Beitov vs Elliston Martin, but am unsure of how this fits with 3 party leases. ARMA's briefing note (no. A17 May 21st 2012) states "if the service charge is payable to the management party then it is the name and address of that party or RMCo that is required"

    The managing agent says this is correct because the RMCo is the 'de facto' landlord.
    This seems absurd, but is it in fact correct?

    TIA

    Cent

    #2
    The definition of landlord is extended from someone with a landed interest to " the person in control" in a number of situations, in this case contractually under the lease, , as well as under statute, as being the landlord.

    However each lease should be carefully reviewed as to the precise arrangement. It is where the landlord and the RMC responsibilities have been blurred or are not truly 3 party that this may not apply. EG where the RMC covenants only with the landlord and not with the tenant.

    Unless your lease is unusual then the advice and position taken is correct.
    Based on the information posted, I offer my thoughts.Any action you then take is your liability. While commending individual effort, there is no substitute for a thorough review of documents and facts by paid for professional advisers.

    Comment


      #3
      Thanks or your reply.

      But, the RMCo is not "in control" - it cannot arrange buildings insurance on our behalf, it cannot give consent for alterations etc. Its only power is to collect s/c and to maintain the building either by self management or by appointing a MA.

      Comment


        #4
        Originally posted by Century View Post
        Thanks or your reply.

        But, the RMCo is not "in control" - it cannot arrange buildings insurance on our behalf, it cannot give consent for alterations etc. Its only power is to collect s/c and to maintain the building either by self management or by appointing a MA.
        Then for those matters it is the person in control, and not for the omitted items of insurance and alterations.

        As I said in the earlier post each lease has to be clearly reviewed,and your lease is an example.

        In placing and demanding insurance as a rent or service charge the landlord would have to send out a demand with the summary of rights and section 47/48 notification. In dealing with alteration they would have to provide the summary for admin charges and any costs invoiced with the Section 47/48 notification.

        It may be that your lease may go further and treat you as an agent and not as a true third party with covenants to both tenant and freeholder.

        Irrespective of the address and identity of the landlord, anyone drafting a claim, LBA or proceedings will read the lease and quickly eventide on whom to serve notice and for what matters, to the extent that they are liable.

        This situation is not uncommon and it all turns on the lease.
        Based on the information posted, I offer my thoughts.Any action you then take is your liability. While commending individual effort, there is no substitute for a thorough review of documents and facts by paid for professional advisers.

        Comment


          #5
          Originally posted by Century View Post
          Thanks or your reply.

          But, the RMCo is not "in control" - it cannot arrange buildings insurance on our behalf, it cannot give consent for alterations etc. Its only power is to collect s/c and to maintain the building either by self management or by appointing a MA.
          If you find the insurance arranged by freeholder is excessively overcharged , you can set up a RTM company to legally claim the arranging of buildings insurance from the freeholder and give it to the RMCo to handle.

          Comment

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