In the

United Kingdom The United Kingdom of Great Britain and Northern Ireland, commonly known as the United Kingdom (UK) or Britain, is a country in Europe, off the north-western coast of the continental mainland. It comprises England, Scotland, Wales and ...

the

Commonhold and Leasehold Reform Act 2002 The Commonhold and Leasehold Reform Act 2002 (c.15) is an Act of the Parliament of the United Kingdom. It introduced commonhold, a new way of owning land similar to the Australian strata title or the American condominium, into English and Welsh ...

provides a right for

lease A lease is a contractual arrangement calling for the user (referred to as the ''lessee'') to pay the owner (referred to as the ''lessor'') for the use of an asset. Property, buildings and vehicles are common assets that are leased. Industrial ...

holders to change the appointment of the management of their building to another provider, by setting up a special company to take over from the freeholder those rights of appointment of management of the building.

One right to manage company per block/''Triplerose Ltd v 90 Broomfield Road RTM Co Ltd''

In March 2015 the

Court of Appeal A court of appeals, also called a court of appeal, appellate court, appeal court, court of second instance or second instance court, is any court of law that is empowered to hear an appeal of a trial court or other lower tribunal. In much ...

found in favour of Triplerose Ltd (freeholder) against 90 Broomfield Road (residents/lessees) in what was a landmark case. The court ruled: The result of this ruling is that no right-to-manage company can apply to manage multiple blocks on an estate. The right relates to a building, so, in an estate of separate blocks, each block would need to qualify separately and an individual RTM notice served. In the case of an estate of flats under the same management, it would be sensible to take over the management of the whole estate, but this would have to be accomplished by application in respect of each separate block.

The duty to transfer funds

The legal obligation of the freeholder or previous management company is to pass forward any unspent funds. In practice, if these are less than £2,000, it may not be economic to pursue them through the courts, but ultimate determination can be made by a

leasehold valuation tribunal A leasehold valuation tribunal (LVT) was a statutory tribunal in England which determined various types of landlord and tenant dispute involving residential property in the private sector. An LVT consisted of a panel of three; one with a backgroun ...

Freeholder's membership of the right-to-manage company

Immediately upon the RTM company taking over on the acquisition date, the landlord (freeholder) becomes entitled to membership of the company, with full voting rights as a company member (if they wish to take it up). The landlord's votes are, in the first instance, determined according to the units they hold in the building, flats or non-residential parts. In cases where they hold no units, and therefore would have no votes, they are allocated one vote as the landlord. As the right to manage is not default-based, there is no reason why the landlord, who retains an interest in the building, should not have some input to the practicalities of its management. It is different where the manager has been appointed by a tribunal to replace a poor or incompetent manager – there the landlord is removed entirely as a consequence of his mismanagement. With the right to manage, it is assumed that the landlord is not necessarily at fault and so there is no justification for his exclusion from the management process.http://www.leaseadvice.org/documents/Right_to_Manage.pdf

References

{{DEFAULTSORT:Right To Manage Law of the United Kingdom Real estate in the United Kingdom Real property law