Right to Manage: Leaseholder Information and Inspection Rights, Landlord Counter Notice and Duty to Provide Information
Under s82 the RTM company has the right to serve a specifically worded notice on the landlord(s) requiring any information ‘which the company reasonably requires for ascertaining the particulars to be included in a claim notice for claiming the right to acquire the right to manage’. The reason the wording is so specific is to enable information to be obtained purely to allow the claim notice to be served, not used as a way to extract information that could be used for something else. If the information is contained in documents such as accounts or bank statements, contracts or specifications then the notice can compel the landlord to allow the inspection and copying of them or to supply copies. A landlord served with a notice under s82 must comply within 28 days.
RIGHT OF ACCESS FOR INSPECTION
The RTM Company can also serve a statutory s83 Right of Access Notice under the 2002 Act requiring full access to the property for inspection. The right is only available after the serving of the Notice of Claim and provides for access to ‘any person authorised to act for the RTM company’ and exercisable by giving not less than 10 days notice. It covers any part of the premises where access is considered reasonable to assist with the claim and evaluation of any repairs or maintenance and not generally accessible to the leaseholders such as the roof, water tanks, communal heating boilers, electrical installations, (if the premises have a lift, the lift motor room), etc. The landlord and any other recipient of the Notice of Claim also has the equivalent right to request access to the flats at the same notice period.
LANDLORD COUNTER NOTICE
Recipients of the Notice of Claim under s84 must issue a counter notice no later than the date specified by the RTM company. The counter-notice will either agree to the RTM or to provide reasons why the RTM company is not entitled to take the process further.The counter-notice does not however provide an opportunity to raise queries or to dispute the RTM on any other grounds.
The counter-notice must be in the prescribed form and is limited to one of the two following statements:
- Admitting that the RTM company is entitled to acquire the right to manage in which case the management will pass to the RTM company on the specified date in the Notice of Claim;
- Alleging that the RTM company is not entitled and giving reasons to support the allegation which are limited to the building not qualifying, the RTM company doesn’t comply with legislative requirements of the 2002 Act or the members of the RTM company do not represent half the flats in the building. The counter notice must also state that the RTM company may appy to the Leasehold Valuation Tribunal for them to decide the issue
The RTM company must make the application to the LVT within 2 months of the date of the landlord’s counter-notice and if they do not, then the claim is deemed to be withdrawn.
Note: If the landlord does not serve a counter notice then the acquisition date will still be the date specified in the notice.
LANDLORDS’ DUTY TO PROVIDE INFORMATION
The RTM company will need the landlord to provide whatever it ‘reasonably requires in connection with the exercise of the right to manage’ under s93. This is a different provision from the request for information because that required information for the purpose of serving the Notice of Claim. This right is for information necessary for the management of the building and in order to effect a smooth transition of management, this notice should be served at least 28 days before acquisition date.
This is to allow the landlord sufficient time to supply any and all information that will help the RTM company from that date onwards. Whilst the company willl need to be very clear on what it requires such as sight and inspection (or copies) of accounts, service charges, maintenance schedules and whether there are any future building works planned etc, and although providing information is statutory on the part of the landlord, he doesn’t have to volunteer it!. The closer to acquisition date the notice served the less likely it will be that a smooth handover will be effected because of the 28 day timeframe so if, for example the notice was served 15 days before acquisition date, the landlord would have still have 13 days over the date to respond. He could also, perfectly legally, delay information provision until 28 days after the company takes over. This would obviously have a negative impact on the ability of the new company to manage effectively until they received all the information. The delay could then go on for even longer if he fails to comply after the 28 days has expired. This would then necessitate in the situation having to go to court for enforcement.