If you own a leasehold property, the Right to Manage (RTM) allows you and other leaseholders take over certain management responsibilities from the landlord, even without the landlord’s agreement and without having to prove bad management. In this article, our residential property team answers some frequently asked questions about a leaseholder’s Right to Manage.
What Is the Right To Manage?
The Right to Manage is a legal provision allowing leaseholders of flats to take control of the management of the building where their flats are situated. It was introduced as part of the Commonhold and Leasehold Reform Act 2002 to give leaseholders greater control over the management of their homes. By exercising the Right to Manage, leaseholders can ensure that their building is managed in a way that meets their needs and priorities.
Can a Landlord Refuse a Right to Manage Claim?
Typically, you do not need your landlord’s consent or a court application. However, strict processes must be followed, and it is essential to ascertain if you qualify. You must also obtain a majority vote from the other leaseholders in favour of the decision. Other qualifying criteria include:
- At least two-thirds of the flats must have leaseholders whose lease term was more than 21 years and are considered “qualifying tenants.”
- The non-residential part of the building cannot exceed 25% of the total floor area, excluding common parts.
- The right to manage does not apply if any qualifying tenant is a tenant of a local housing authority.
- The Resident Landlord Exemption may also prevent the right to manage from being granted. This exemption applies if the premises are not a purpose-built block (e.g., a converted house), comprise no more than four flats, and at least one flat has been occupied by the landlord or an adult family member as their only or principal home for at least the last twelve months.
- A landlord has the right to be an RTM company member and to vote on decisions. A landlord can have at least 1 vote. How many votes a landlord has depends on how many flats they own in the building.
How Do I Make a Right to Manage Claim?
You must serve a legal notice on the freeholder or the current management company to initiate the process. However, you must initially set up your own RTM company, and every leaseholder should be invited to become a member. The law also requires that at least 50% of the flats must participate. The notice will provide a four-month window for management to transfer to the RTM company. Upon serving this legal notice, the transfer of management is automatic. If successful, the freeholder will still own the building, but you will manage it and be responsible for things like:
- collecting and managing the service charge
- upkeep of communal areas (such as communal hallways and stairs)
- upkeep of the structure of the building (such as the roof)
- dealing with complaints about the building from other leaseholders
What Happens if My Landlord Disputes A Right To Manage Claim?
Your landlord can dispute a Right To Manage Claim by serving a counter-notice to the RTM company before the deadline specified in the claim notice (which should not be less than one month after the service of the claim notice). If the landlord disputes the claim, the counter-notice must include reasons why they think your RTM company is not entitled to manage the building. Reasons may include:
- the building doesn’t qualify
- the RTM company doesn’t comply with the legal requirements
- the RTM company members don’t represent half the flats in the building
However, your landlord cannot dispute the claim for any other reason. If you do not agree with the counter-notice you must apply to the Leasehold Valuation Tribunal (LVT) within two months of the date of the counter-notice. The LVT will then decide if your RTM company can manage the building or if it supports the landlord’s dispute.
Enfranchisement and Right To Manage Solicitors
To ensure a successful Right To Manage notice is served, it is crucial to acknowledge the significant groundwork required beforehand. This is a complex area of law, and it is highly recommended that you instruct a solicitor with specialist knowledge early in the process, ideally as soon as you have enough qualifying tenants on board. Our highly experienced property team will assess whether you meet the qualifying criteria and, if so, will guide you through the right-to-manage procedure.
If you are considering making a Right to Manage application, please contact a member of our team below or email info@roselegal.co.uk for an initial consultation to discuss the best way forward for you, and we will provide you with further and specific advice tailored to your circumstances.
Our skilled and understanding team are here to help you. We will work with you to ensure the best possible outcome.
Looking for information on Enfranchisement? You can also read our previous blog on:
FAQs About Leasehold and Collective Enfranchisement
This blog post is not intended to be taken as advice or acted upon. If you are seeking legal advice, please get in touch with our team of solicitors.
