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ExpertUKLawyer, Solicitor
Category: Property Law
Satisfied Customers: 10
Experience:  Master of Laws
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Please, 3 out of 4 kease holders in a building have set up a

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Hi yes please , 3 out of 4 kease holders in a building have set up a right to manage company. This is because the services we pay for have not happened over the last 5 years . We each owe a years ground rent and want to pay direct to the fresher. He says we have to pay to te old management company? Also the past accounts have only just been released to our accountant to check . He is threatening to take us to court over this ? Surely we have time to check thses accounts which are in dispute ?
JA: Where are you? It matters because laws vary by location.
Customer: Littlehampton west sussex
JA: What steps have you taken so far?
Customer: We have set up a new rtm company with no proposal. It goes live tomorrow. We have offered to pay ground rent arrears direct to the freeholder
JA: Anything else you want the Lawyer to know before I connect you?
Customer: Think that's it for now

Hello. I’m George and I’m your solicitor. I have a Master's in Law and six years of experience. Please allow me some time to review the information.

The Commonhold and Leasehold Reform Act 2002 gives tenants of blocks of flats the collective right to take over the management of their building from the landlord without having to acquire the freehold. This right can be claimed out of court, is irrespective of fault on the part of the landlord, and no compensation is payable.

For this purpose, the building must be a self-contained block of flats. It must have no more than 25% non-residential use (ie the internal floor area of any non-residential part(s) must not exceed 25% of the whole internal floor area), and two thirds of the flats must be let to qualifying tenants.

This right to manage can only be exercised through membership of a right to manage company. It can be protected by registering a notice against the landlord’s title.

Please could you let me know which stage in the process has been reached? For example, has a notice of invitation to participate been served on every qualifying tenant who is not already a member of the company and who has not already agreed to become a member? The notice of invitation to participate must be served at least 14 days before the RTM company serves the claim notice on the landlord.

Has the RTM company served the notice of claim on the landlord(s) of the premises, any third party to any of the flat leases (eg a guarantor) and any manager of the premises who has been appointed under Landlord and Tenant Act 1987, Part 2? A copy of the claim notice must be served by the RTM company on every qualifying tenant.

Has the landlord served a counter-notice which admits or disputes the claim before the deadline specified in the claim notice (which must give the landlord at least one month to respond)? The landlord can only dispute the claim if the building does not qualify, the RTM company does not satisfy the statutory requirements or the RTM company members do not represent half the flats in the building.

If the RTM company does not agree with the grounds of opposition, it must apply to the First-tier Tribunal (Property Chamber) in England to determine the validity of its claim. The application must be made within two months of the date of the counter-notice. If the application is not made within this time, the claim is deemed to be withdrawn.

Has the claim been accepted or determined to be valid? If so management of the building transfers to the RTM company on the ‘acquisition date’. This will be the date specified in the notice of claim (if the claim is accepted), three months after any determination becomes final or three months after any agreement accepting the validity of a claim which was originally disputed.

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Customer: replied 8 days ago.
We have formed our right to manage company , and go live tomorrow . No contest from the freejolder. We have buildings insurance set up already . We want to pay our ground rent direct to him but he wants us to pay the management company as normal . We are disputing charges relating to maintenance ie gutter clearing, drain blockage and cleaning and gardening which have never been done ! We have an email from him today to say all monies must be paid by Friday or he will take us to court. The accounts were only made available to us on Saturday and our accountant needs to check them first. Only 3 contractors invoices were sent for 5 years ! He has ccj's against him in the past and a fraudulent back gtound
Customer: replied 8 days ago.
Ok can he throw any light on the last message?

I tried calling you. I will try again later.

Customer: replied 8 days ago.
Om home now and available

Thank you for your time on the phone just now. I am sorry to hear about the issues you are having with your landlord.

As discussed, the first step is for you to pay the ground rent arrears direct to your landlord’s agent. Ground rent and service charge are separate and as the ground rent is not in dispute, it should be paid. Non-payment of the ground rent is likely to be a breach of your lease.

As for the service charge arrears, I recommend you write a formal letter to your company landlord stating that you are disputing the service charge and the reasons why. The more evidence you can enclose with the letter, the better. You should send the letter and the accompanying evidence to the registered office address of the company and also send a copy of the letter by email. Hopefully, the landlord will offer a compromise in light of your formal letter. Even if the letter does not bring about a resolution to the dispute, the letter will assist you if this matter goes to the First Tier Tribunal.

If the letter does not bring about a resolution, the next step would be for you to issue a formal complaint. The landlord company's website might set out the complaints procedure that you need to follow, or you may be able to request the procedure from the relevant contact at the company. You should then follow the complaints procedure to the end. Hopefully, this will bring about a resolution to the dispute.

If not, the final option is to go to the First Tier Tribunal. This should be a last resort. The cost of going to the First Tier Tribunal may be disproportionate to the amount of service charge arrears.

For completeness, the landlord must, on the acquisition date or 'as soon after that date as is reasonably practicable' pay over to the RTM company the balance of any service charge payments collected in advance (including any reserve account or sinking fund), together with any interest. The landlord’s or manager’s liability to pay ‘accrued uncommitted service charges’ to an RTM company only extends to those sums actually held by the landlord or manager. Any service charge required to meet costs incurred before the right to manage was acquired is not included. Any dispute as to the amount to be paid over should be referred to the First Tier Tribunal if an agreement cannot be reached.

I hope I have provided the information you were seeking. If you are happy with my service, your 5-star rating at this time would be most welcome.