Right to Manage
I had already attended a number of meetings held by various leasehold organisations and the one that was the turning point for Wellington Mansions was held by the Campaign for the Abolition of Leasehold (CARL) in 2006. I had already been on their panel a couple of times but this time I was an audience member. I took my partner to this one and we were both impressed by the talk about buildings insurance given by guest speaker Roger Southam of managing agent Chainbow. At the end of his talk he asked the audience if they had any questions and jokingly my partner asked ‘will you come and manage our block please? He invited us to come and chat to him at the informal drinks that were held after the meeting and to our complete surprise he agreed to take us on!
To be honest it was one hell of an anti-climax after all the effort that had been put in to that point to get any help and we wished we had met him years earlier!
Everything started to happen all at once because shortly after that we finally met the criteria for the Right to Manage which Roger Southam guided us through with five qualifying leaseholders attended a meeting with three of those five agreeing to act in the capacity of Directors (2) and Secretary (1). The Directors were formally appointed by Board resolution and their details entered onto an application form for registering a new company on a Form IN01 (which replaced the Form 10 on 1st October 2009), signed and filed with the Registrar of Company at Companies House where the company was also then registered as a company limited by guarantee. This was because this type of company was thought to be the most appropriate vehicle when the right was created. Companies who use it do not trade and it can’t be formed by share capital under s5 of the Companies Act 2006. This renders it unsuitable for commercial enterprise, making it less likely to become insolvent. The incentive for members to become involved is commitment to the company’s objectives rather than profit as with shareholder companies.
It was also agreed that as I had by far the most experience with regard to leasehold matters that I should be the communications link between the company and the managing agents. In order to start the management of the building we had to set up a service charge budget from scratch as we inherited no funding and one of the first things carried out was the commissioning of a Building Condition Report. It had been several years since the HHSRS survey had been carried out by the council and it was obvious that the state of the building would have worsened.
We didn’t have to take all of the steps associated with the right to manage process as our freeholder was deemed ‘absent’ but we did have to send out the Notices of Participation to other qualifying leaseholders.
Later it was suggested to us that we try to obtain the freehold by the use of compulsory acquisition.