Leaseholders of flats in England and Wales have various options available to them if they have an absentee landlord who has stopped maintaining and/or insuring their property. The specific steps you can take will depend on the terms of your lease and the specific circumstances of your case. The first steps you should consider are:
Reviewing your lease
Leaseholders should start by thoroughly reviewing the terms and conditions of their lease, or instructing a solicitor to do the same. A well-drafted lease should outline the responsibilities of the landlord and the leaseholders regarding the maintenance and insurance of the property. If a management company has been appointed by the landlord, the lease should also outline their responsibilities.
Contacting the landlord
Leaseholders should attempt to contact the absentee landlord, to inform them of the issues and request the necessary remedial action. If you are unsure about the identity of the landlord, the Land Registry may have this information.
By law, service charges and ground rent demands must contain the landlord’s name and address. Therefore, you should also check your most recent service charge demand (and ground rent demand if you are obliged to pay ground rent in accordance with your lease) to see if this information is contained within the document.
Contacting the managing agent, if the landlord has appointed one
If there is a managing agent responsible for the property, leaseholders should contact them to report the issues. The managing agent may have the authority to carry out necessary maintenance and repairs on behalf of the landlord. They should also have up-to-date contact details for the landlord.
Apply for the Right to Manage (RTM)
Subject to meeting certain criteria, leaseholders have the legal right to take over the management of the property, through a process known as the Right to Manage (otherwise referred to as RTM).
This process allows leaseholders to form a company (known as an RTM Company), which will take over the management of the building, including being responsible for maintenance, insurance, and service charges.
In order to formally notify the landlord of their intention to invoke their RTM rights, the RTM Company must usually serve a notice on the landlord. However, if the landlord cannot be found, or their identity cannot be ascertained, the RTM Company is not required to serve the notice on the landlord. Instead, the RTM Company can apply to First-Tier Tribunal (Property Chamber) for an order that the RTM Company will acquire the right to manage the building. Leaseholders should note that the tribunal will not make such an order, unless the RTM Company has notified each qualifying leaseholder of the application.
The tribunal may also require the RTM Company to advertise their intention to exercise their Right to Manage, or take other steps to trace the landlord and the other parties to the lease.
If a missing landlord is found before the order is made, the tribunal will decide how the matter will be dealt with. The RTM Company can also withdraw the application at any time before the order is made.
There are specific requirements and procedures to follow, so it’s advisable to seek legal advice from a solicitor.
Subject to meeting certain criteria, if the leaseholders wish to take over full control of the property, they can explore the possibility of collective enfranchisement. This process allows the leaseholders to collectively purchase the freehold of the building and become the landlord.
In a similar way to the Right to Manage, to initiate the process of collective enfranchisement, the leaseholders are usually required to serve a notice on the landlord. However, if the landlord is genuinely uncontactable, the leaseholders can apply to the County Court for an order removing the need for them to serve the notice on the landlord. The leaseholders can then apply to the court to make what is called a vesting order, whereby the court sells the freehold to the leaseholders in the freeholder’s absence.
Before making any of the above orders, the court will verify that the participating leaseholders are entitled to serve the notice that would have otherwise been served on the landlord. In practice, the court will usually require the applicants to advertise their claim (such as by placing an advertisement in a local and national newspaper) and to take other steps to try and trace the landlord. If the landlord is successfully traced, the court will decide how the proceedings will be directed moving forward.
Appling to the First-Tier Tribunal (Property Chamber) for an order appointing a manager to act in relation to the property
Subject to meeting certain criteria, leaseholders can also apply to the First-Tier Tribunal (Property Chamber) for an order appointing a manager to act in relation to the property.
Unlike with the Right to Manage and Collective Enfranchisement, this option requires the leaseholders to prove certain grounds before they can make the application. For example, the leaseholders must prove that under the terms of the lease, the landlord is in breach of an obligation owed to them in relation to the management of the building. The leaseholders must also prove that it is just and convenient for the order to be made in all the circumstances.
In a similar way to the Right to Manage and Collective Enfranchisement, before applying to the First-Tier Tribunal (Property Chamber), the leaseholders must serve a notice on the landlord, confirming their intention to apply for the order. However, if the landlord is genuinely uncontactable, the leaseholders can apply to the First-Tier Tribunal (Property Chamber) for an order to remove the requirement to serve the notice on the landlord.
Before they will consider their application to appoint a manager, the tribunal will usually require the leaseholder to take certain steps (such as advertise their application in a local and national newspaper) and prove that they have been unable to trace and therefore are unable to serve the notice on the landlord.
Attwells has extensive experience with the Right to Manage, Collective Enfranchisement and applications to the First-Tier Tribunal (Property Chamber). We can assist you throughout the entire process, including preparatory work, serving of notices, applications to the court and executing on property transfers. Call us today on 01473 229200 or email us at firstname.lastname@example.org for further information and a fee quote.
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