Enfranchisement - You Have a Right - By: Tim Bishop

As a collective group you are awarded the right to manage the way that your block of properties is run. This right is awarded under the Commonhold and Leasehold Reform Act 2002. This right also involves making independent decisions such as those relating to maintenance, insurance, gardening and cleaning.

The key is RTM - or right to manage. However, why not go further than just 'right to manage' and consider the right to enfranchise or 'collective enfranchisement'? To implement the right to manage, there is no need to prove mismanagement by the landlord or the current managing agent. The landlord's consent is not even required and even if the landlord is absent, the leaseholders should be able to secure the freehold management via RTM.

But, one more step to collective enfranchisement means that the tenants, collectively, once eligibility has been ascertained, set up shared ownership of the freehold. So you can manage and own the flat!

It may be that the landlord has collected service charges in advance or has funds in reserve which he is holding in a trust account. In this situation he is supposed to return them to you. You will need to comply with statutory requirements relating to the management but you may find that you can manage maintenance much more efficiently. You save on day to day running and management spending. At the same time you are increasing the value and saleability of the premises with the enfranchisement.

Often the landlord has levied exorbitant service charge demands which are costing the tenants far more than is due. As well as doing this you may have evidence that the landlord has done unnecessary repairs - or may have ordered repairs to be done which were inappropriate or simply sub standard. The overly high charges have crept up on some unaware tenants which then has cost them up to thousands of pounds!

Isn't it good news that the RTM company can actually force the management to be taken away from the landlord? And further good news that if you satisfy fairly standard criteria you can own the freehold together, instead of the landlord.

It is much more sensible to get these things done, when, where and how they should be and in a way which is decided by you? Wouldn't it be great to own the freehold and know your flat has risen in value and more attractive to potential buyers?

Get in touch with a solicitor who is experienced in enfranchisement or the right to enfranchise; it can get complicated and it is not something to tackle in a DIY fashion, no matter how astute or assertive you may be.

About the Author

Bonallack and Bishop are specialist enfranchisement solicitors with significant expertise in how to form a right to manage company. Tim Bishop is senior partner at the firm, responsible for all major strategic decisions. He has grown the firm by 1000% in 13 years and has strong plans for its continued expansion.

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