Leasehold Right to Manage – Why Instruct a Solicitor?

This article discusses a tenant’s right to manage the property in which his/her leasehold is situated. It is important if you are considering the right to manage that you instruct an experienced leasehold solicitor for expert advice before you proceed.

What is the right to manage?

The right to manage process was introduced by the Commonhold and Leasehold Reform Act 2002. It enables a tenant of a qualifying lease to remove management of their property from the landlords’s power and exercise their own control over it. A right to manage action is normally brought by tenants whom feel that their landlord is not utilising service charges efficiently and is wasting money. Actions are also brought if the landlord is negligent towards the maintenance of the property.

A right to manage action is normally exercised through a company designed for this purpose. A right to manage company is formed and tenants become directors of this company performing any duties that need completing. The company as a whole will look after insurance, maintenance and any necessary repairs needed for the building, it will also take service charges from the tenants as individuals.

As discussed previously a right to manage application can be brought for many different reasons including the landlord’s conduct, however providing that reason is not necessary to lodge an application. The right to manage is an automatic right for tenants and therefore giving a reason behind the wanting the application is not necessary. The landlord should not have a problem with the creation of a right to manage company as long as his costs in allowing the tenants to do so are recuperated. A landlord can however later revoke the right if the newly created company does not maintain the property to a reasonable standard and if costs are cut which consequently endangers other tenants.

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Why do I need to instruct a solicitor?

– A right to manage application can be complex as it is statute based and is affected by different areas of the law. An experienced leasehold solicitor will have an in-depth knowledge of the law and will ensure that you follow the correct procedures. Not only this, but you will need specialised advice in setting up the right to manage company, which will subsequently require legal documents to be drafted.

– Your freeholder will most likely instruct a solicitor when he/she receives a right to manage claim, therefore it is beneficial for you to be adequately represented when making your application. A solicitor working for you will be able to negotiate terms, which are the most favourable to you.

– Your solicitor will have a large amount of professional indemnity insurance. This means that you can rest assured that if an error is made you will have access to adequate recourse. You should also be aware that solicitors have their own ‘Code of Conduct’, which is produced by the law society and governs the way that solicitors treat their clients and the level of service they supply.

– Although you may feel like you know the law surrounding the legal right to manage, solicitors as professionals are under a duty to remain up to date with recent developments in the law. Therefore if the law has recently changed or been slightly altered your solicitor will be fully aware of these changes.

How shall I decide which right to manage solicitor to use?

Search for firms that have specialist leasehold departments. It is also useful if the firm that you instruct has a corporate department, which can deal with any complex aspects of setting up your right to manage company. Do not be afraid to talk to solicitors about their personal level of experience and ask for references for their work.

A good place to begin your search is a firm’s website. The website should provide basic information regarding the right to manage and an indication to whom in their team you should contact directly for such a service.

Prior to instructing a solicitor you should obtain a quote for the right to manage application and setting up a right to manage company. Agree a fee limit with your solicitor so that you are able to stay within your budget.

Bonallack and Bishop are specialist leasehold enfranchisement solicitors with significant expertise in advising on forming 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 continued expansion.
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