Appointment of a Manager

Appointment of a Manager

Sometimes, the Right to Manage (RTM) is not available because:

• the building does not qualify; or
• not enough leaseholders are willing to act collectively.

Alternatively, if the landlord/management company is owned and controlled by the leaseholders already, RTM would not result in the management changing.

Section 24 Landlord and Tenant Act 1987

Where dissatisfied, leaseholders have a statutory right under Section 24 of the Landlord and Tenant Act 1987 to ask the First Tier Tribunal to appoint a manager in place of the landlord or existing management company.

Unlike RTM, this is a fault-based remedy, requiring the leaseholder applicant(s) to demonstrate as many of the following as possible if they are to succeed:

• The managing party is in breach of the lease.
• Unreasonable service charges or administration charges have been demanded or are proposed.
• The managing party has breached a Code of Practice approved by the Secretary of State.
• It would be just and convenient in the circumstances to appoint a Manager.

“More than happy with Mike Hansom’s service. I’ve dealt with BLB on and off for years and it’s always been very good”. KB

Is the appointment of a manager right for you?

There are a number of issues to consider before deciding whether an application for the appointment of a manager is the right step for you:

• Legal fees are likely to be higher than for an RTM claim. This is because of the requirement for an application to the Tribunal and the need to prove your case, which might well be contested by the existing managing party.
• There is no certainty of success. You must establish that it would be just and convenient to appoint a manager. It is important to appreciate that this is considered a draconian remedy, so it is not sufficient simply to show the existing managing party could do better.
• If you are successful, the manager appointed by the Tribunal has a duty to the Tribunal over and above that owed to the lessees. They are required to act in the best interests of the building containing the flats, not the leaseholders who made the application.
• The manager can be given powers by the Tribunal beyond those of the existing managing party to the lease. If there are defects in the lease, the Tribunal could grant powers to the manager which solve the problems.
• Service charges might not decrease and could even increase following the appointment of a manager.