28 March 2014 by

My landlord’s not managing!

If your block of flats is not being properly or efficiently managed by your landlord or managing agent, there is something you can do about it that doesn’t involve too much money. The ‘Right to Manage’ can be claimed if at least 50% of the tenants in the block apply, the result of which is that the tenants take over the management responsibility for the building. The tenants can then manage the block themselves or employ a management company of their choice to do it for them.

The ‘Right to Manage’ is a no fault right, so there is no need to prove bad management on the part of the current managers or landlord. Another right that is commonly used to take control of the block is ‘Collective Enfranchisement’ which involves the purchase of the freehold and removal of the landlord.

There are some key differences between buying the freehold and obtaining the Right to Manage, the foremost being that where the tenants acquire the Right to Manage no premium is payable to the landlord, only his reasonable legal fees incurred in the process. In addition, all tenants in the block have the right to participate and must be invited to join the process, whereas in a freehold purchase the tenants do not need to invite every tenant to join in.

The Right to Manage process is carried out through a Right to Manage Company made up of the tenants. It is important to remember that when the Right to Manage is acquired the landlord has a right to become a member of that Company, so the landlord will remain in the picture. The landlord will also retain rights in relation to the property such as forfeiture and re-entry and responsibility for any commercial tenants.

Where the tenants acquire the Right to Manage, they will have responsibility for services, repairs, maintenance, improvements, insurance, service charges, approvals under the lease and enforcement of some lease covenants. It is the landlord’s or managing agent’s failure to carry out these important responsibilities that usually triggers the tenants into wanting to take over the management but, as mentioned above, the landlord will remain very much in the picture.

For further information on exercising the right to management or acquiring the freehold interest of your building please contact Darren Coleran (t) 020 7288 4775 (e) darrencoleran@boltburdon.co.uk.

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