Can Leaseholders In a Block Set Up A Right To Manage Company? - By: Tim Bishop

Have you heard about the right to manage or RTM as it is also called? If you live in a block of flats, then this legal right could be of a huge interest to you.

Well, before you charge ahead and set up your right to manage company, based on a vague whim, maybe you should give some time first to thinking about what you - and your fellow leaseholders - actually want to achieve.

Sounds obvious? It is, but surprising how many hear about something in the press and start on a procedure that they have little real idea about.

The highest quality advice will be saught from a solicitor who knows about the right to manage leasehold property and specialises in helping clients follow the process. You may well find a specialist solicitor will give you a free first consultation, to establish whether it is for you or not.

Taking over the management of your building - and your most valuable asset - is not a matter of signing a few docs and away you go. Although having a right to manage solicitor on side takes away a lot of the stress and complications of the process, you still have to take a serious and mature approach.

A specialist solicitor will speak to you about the duties and liabilities that come with the responsibility of management and your right to manage company. Your overall motivation has to be a key issue.

As the leaseholders will jointly be acquiring the power to make approvals and to enforce the covenants of the leases, you need to be aware that you will also become responsible for decision-making. This is in serious areas that cover not merely the standard of management, repairs and provision of services but also being involved with budgets, reserve funds and any major works required.

So, it is no good just thinking you can approach this with a casual DIY view. It is not merely about saving some money and getting a few more bits and pieces repaired more efficiently. Your right to manage company solicitor will explain some basic issues to you which you need to give thought to, prior to taking any action. Some of these are:

- as a pass over of the responsibilities involved in running the building, RTM doesn't necessarily equal self-management.

- it may be the case that management is best left to the professionals i.e. a proper management company, especially if the block only has 6 flats.

- any right to manage company will be under an obligation to comply with any Government code of practices on management.

There are a good many more issues than this but speak to a specialist RTM solicitor and get proper advice and instruction before proceeding further.

About the Author

Tim Bishop is senior partner at Bonallack & Bishop, a firm of solicitors experienced in advising on forming a right to manage company and right to manage leasehold properties. Tim is responsible for all major strategic decisions, seeing himself as a businessman who owns a law firm. He has expanded the firm by 1000% in 13 years.

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