RTM: Serving the Claim Notice on the Landlord, their Counter Notice and Rejected Claims
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.
Serving the Claim Notice
The formal notice of the intent to claim the Right to Manage is now submitted to the landlord. It is dictated by legislation and must contain the following:
- Premise details;
- Full names and addresses of each qualifying tenant who is a member of the RTM company;
- The name and registered office of the RTM company;
- A specific date for which the landlord must respond via a counter notice but no earlier than one month from the date that the claim notice was issued;
- A specific date (of not less than three months after the date for the service of the counter-notice), on which the RTM company intends to acquire the Right to Manage.
Once the claim notice has been served, the landlord has one month in which to respond.
Right of Access Notice
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 not only should it state that the RTM company may apply to the Leasehold Valuation Tribunal for them to decide the issue if the landlord disputes the claim but it is also 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 following:
a) The building does not qualify;
b) The RTM company does not comply with legislative requirements of the 2002 Act;
c) Members of the RTM company do not represent half the flats in the building.
There are however a number of reasons why an RTM claim may be rejected by the landlord because they are deemed not to have met the legal requirements which are:
- Less than two thirds of the flats are held by qualifying tenants;
- Less than 50% of leasehold owners are members of the RTM Company;
- The member register has not been correctly updated at the correct location;
- There is insufficient documentation that prove members are qualifying tenants;
- The RTM Company formation is incorrect because the company has not been set up as limited by guarantee;
- The Memorandum and Articles of Association are incorrect;
- There is no certificate of incorporation;
- If there is more than 25% of commercial space in the building, anything close to this number is likely to be disputed and require detailed measurements from a surveyor);
- The date for a Counter Notice being insufficiently long;
- Non-participants not being served the correctly worded invitation to join in the RTM process (Notice of Participation);
- Non-participants not being given enough time to respond;
- No proof of RTM members receiving copies of the RTM Claim.