We Get an Agent and Use Right to Manage Legislation
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, CEO of 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.
Not only that, but shortly afterwards we met the criteria for using the Right to Manage legislation, granted to leaseholders under s71 of the Commonhold and Leasehold Reform Act 2002. This was hailed as a great right as it was the most radical attempt at addressing the problems caused by negligent and incompetent managing agents. It is a ‘no-fault’ process allowing leaseholders to either replace their own managing agent with one of their own choosing or self-manage. Or in our case, to actually get an agent! No premium is payable and there is no need to go to court to prove ‘fault’ on the part of the freeholder.
The minimum requirements are;
- The building must include a minimum of two flats.
- At least 66% of the building must be let to qualifying tenants.
- If the building is mixed use then no more than 25% of the commercial space should occupy the total floor space of the premises.
- Each leaseholder must have a lease granted for an original term of more than 21 years;
- The required minimum number of qualifying tenants must be equal to at least half the total number of flats in the building.
The RTM company was also established as a company limited by guarantee, more on which can be read here.
Once the criteria has been met and the RTM company formed, the next step is sending out the Notice of Participation to the other qualifying leaseholders.