The RTM Claim has landed now what?
<p><a href="http://brethertons.co.uk/Home/Individual/Leasehold-Enfranchisement/Meet-the-Team.aspx">Roger Hardwick</a>, Head of Leasehold Enfranchisement, <a href="http://www.brethertons.co.uk">Brethertons Solicitors.</a></p>
Upon receipt of a Right To Manage claim notice, a landlord party will need to give consideration to legal, commercial and tactical issues, which will include the following:
- Whether or not to admit the claim;
- Its obligations and position in respect of contracts;
- Issues with regard to contractor notices;
- The general approach to take in dealing with the RTM Company;
- The treatment of service charges; and
- Costs.
Counter-Notice
Any party given a claim notice by a RTM company may give a counter-notice. This must be done no later than the date specified in the claim notice.
The requirements for a counter-notice are contained in Section 84 and the 2003 Regulations with a prescribed form annexed at Schedule 3 to the 2003 Regulations.
The counter-notice must:
-either admit the right or allege that the RTM company was not entitled to exercise it;
-if the right is disputed, give reasons by reference to provisions of the 2002 Act and state that the right will not be acquired until so determined by the LVT or agreed by the landlord;
-if the right is disputed, state that the RTM company may apply to the LVT for a determination of the matter within two months;
-contain the information provided in the notices to the prescribed form.
The notice should be served at the address for service of the RTM company given in the notice of claim and within the time-frames set out.
Landlord’s consideration:
The scope for dispute is fairly limited. RTM is a no-fault process therefore a landlord cannot object because it considers the RTM company is incompetent or there are service charge arrears. A landlord can only object on technical grounds i.e. qualifying criteria has not been met or the claim notice is substantially defective.
Regardless of potential technical objections, the landlord should consider whether or not it should object and the extent to which it will wish to incur costs which may be irrecoverable from the RTM. Also landlords need to consider whether it is simpler and more pragmatic to accept the claim.
When faced with a claim notice Landlords should seriously consider whether there any benefits in disputing the claim even simply for the purpose of delay and what benefit is to be gained? The answer will depend on the particular circumstances.
Although the process will often usually be prompted by problems with the management, the practical issues will usually force there to be a discussion between the parties. After all, it is also in the landlord’s interest that the premises be managed properly by the RTM company.
For further information regarding this article, contact Roger Hardwick, Head of Leasehold Enfranchisement, Brethertons Solicitors.
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