Help with leasehold dilemma!

Help with leasehold dilemma!

9:55 AM, 9th May 2024, About 2 weeks ago 22

Text Size

Hi, all our twenty private management company shareholders are owners of their flats, and hold them on Leasehold Title Absolute. Collectively (as our company) we own our entire property on Freehold Title Absolute. The twenty shareholders are of equal status, each of us holding 200 shares in our property.

Our governing legislation is the Companies Act 2006 and we are registered at Companies House. We have a Lease that binds all of us it is held by HM Land Registry. On paper, this setup should provide a sense of security and stability. However, despite these legal safeguards, our collective situation is far from comfortable.

We have five directors all but one are totally inactive. The one gets no support from the inactives. None of them has read our Lease, nor has even a remote acquaintance with the Companies Act 2006.

A manager was foisted on our company by two outgoing directors. The manager assigned to us seems to lack any understanding of our lease terms.

Under his management (now 11 years long), the flats in our seafront Grade II listed terrace of four Victorian houses fetch the lowest prices in our modest town.

As if that were not enough to get up my nose, this manager has locked me out of the loft above my flat, to which our Lease privileges me (as it privileges the three other flat owners who have a loft) as the person with the sole right of entry to it.

I am almost finished preparing my plea to the FTT(Prop) to dismiss this manager, and appoint a qualified one to our company. However, I am worried that I might harm my company by creating problems at Companies House with my FTT(Prop) appeal.

Will that happen? Please, however, do not advise me to seek a solicitor’s help. Only the company law specialists among them know this ground. I have already burnt my fingers twice on solicitors who purport to know it, but haven’t a clue.

Thanks,

Sophie


Share This Article


Comments

Kizzie

10:25 AM, 9th May 2024, About 2 weeks ago

You and other leaseholders own the freehold owning residents management company under 2 separate hats
1 each LH as shareholder hold obligations to company memorandum & articles
2 each LH as lessee hold obligations under your own individual lease
You all own a equal share of the freehold interest held in man co.
Under M&A each shareholder can vote off directors at an EGM properly set up. You will need to find others as replacement.

Hamish McLay

11:00 AM, 9th May 2024, About 2 weeks ago

There are some exceptional Property Lawyers, but sadly, not enough are true professionals. The good ones will be more than willing to discuss situations, evaluate your challenges, and determine whether they can resolve them to your satisfaction.
You have stated, "Only the company law specialists among them know this ground". Personally, I would be concerned as, quite clearly, the "company law specialist", does not appear to be helping the situation any.
Only a Property Lawyer can give you full support on this matter. I would also suggest using a Leasehold Specialist.

Andy

11:20 AM, 9th May 2024, About 2 weeks ago

We own a flat with similar share of freehold structure to yours; I can empathise with your position and frustration. If this is any help: what I’ve learned over many years is that trying to force change is often a huge undertaking which is typically borne solely. Instead, it can be better to gently encourage some incumbent directors to resign and other shareholders to join the board. If folks are unwilling, that tells you you’re on your own if you want to change the status quo and whether trying to do so is worth your energy.
If you do get some fresh faces at board level then changing the property manager is straightforward administration and you needn’t worry about tribunal and possible impact on the company. But if the board situation remains unchanged then looking ahead the tribunal and company is going to become a lesser worry in the grand scheme of things.

havens havens

14:05 PM, 10th May 2024, About A week ago

I will suggest you proceed with your appeal to dismiss the manager and appoint a qualified one. Clearly label all documents related to the appeal to differentiate them from general company matters. Keep records of your actions and responses from Companies House to demonstrate that you're addressing a specific management issue without harming the company's overall status.

Kizzie

8:27 AM, 11th May 2024, About A week ago

Companies House is only a register. Under new AML rules they’re interested in whether the annual returns are true reflection of the Company.
It seems not if directors are not performing their fiduciaries to the M&A, not putting resolutions to the owners of the company (shareholders)for a vote, not holding elections, not passing accounts for approval by shareholders at AGMs, and are the figures declared in ARs for accounts true and honest, and the service charge held separately in statutory trust client accounts section 42 LTA etc. otherwise registered as limited liability you may be struck off by companies house.
You need to appoint a MA with a good reputation to provide help and guidance before you go to the Tribunal

Sophie Johnson

10:16 AM, 11th May 2024, About A week ago

Reply to the comment left by Kizzie at 09/05/2024 - 10:25
Hi Kissie!
' each LH as lessee hold obligations under your own individual lease'

We do not have individual leases. We have one company Lease that binds all of 20 of us.

Sophie Johnson

10:26 AM, 11th May 2024, About A week ago

Reply to the comment left by Hamish McLay at 09/05/2024 - 11:00
Hi Hamish!
' I would also suggest using a Leasehold Specialist.'

This was the subject of my argument with two let-down solicitors. We are a company; we are governed by the Company's Act 2006. We are share-of freehold owners. We do not have a landlord.
The Companies Act does not concern itself with block management. As I understand it, the LL&T Act does not either. Our only Guidance on block management is our lease.

Sophie Johnson

10:44 AM, 11th May 2024, About A week ago

Reply to the comment left by Andy at 09/05/2024 - 11:20
Thank you, Andy! I take your poinst fully, and recognise a fellow sufferer in you. 🙂

Sophie Johnson

10:49 AM, 11th May 2024, About A week ago

Reply to the comment left by havens havens at 10/05/2024 - 14:05
Thank you, havens havens, for your encouragement. I suspect that I shall not be able to prevent myself from going ahead. But I fear the possibility, if indeed there is one, of getting my company struct off by Companies House. (If this does not sound sensible, that is only because it is not.)

Sophie Johnson

10:52 AM, 11th May 2024, About A week ago

Thank you, Andy! I take your poinst fully, and recognise a fellow sufferer in you. 🙂

1 2 3

Leave Comments

In order to post comments you will need to Sign In or Sign Up for a FREE Membership

or

Don't have an account? Sign Up

Landlord Tax Planning Book Now