(… which is what we have been saying all along)
Ten months after the Triplerose decision in the Court of Appeal on multi-block RTMs, the Leasehold Advisory Service has issued its advice: don’t do anything.
“The advice to the customers for now can only be to do nothing, unless the landlord starts any action of their own.
“There has been no authoritative court judgement on this point. [ie the status of existing multi block RTM’s]
“Consequently, the law is not settled and therefore, we cannot say for certain what the legal position is.”
This advice echoes that of LKP / Carlex, but sits in contrast to letters sent to RTM directors by the Right To Manage “Federation”, among other commercial operators, saying directors must “Act now” and that “Your RTM company may be illegal”.
Inevitably, commercial intermediaries are seeing the Triplerose v 90 Broomfield Road RTM Co decision as a fee-earning opportunity.
It is understood that RTM directors are being advised to head off to the property tribunal, dissolve their RTM company and then set up new RTM companies for each of the blocks. LKP has seen correspondence for one site – with only two blocks and the sleepiest conceivable housing association freeholder – where fees of £4,500 were suggested.
Here there is very little risk of the freeholder doing anything at all.
LEASE is to write to Dudley Joiner, of the RTMF, “removing reliance he has placed on the previous letter [from LEASE]” which suggested its support for active intervention.
Over a number of months, LKP has discussed the Triplerose issue with government, the Land Registry and barristers.
None of the lawyers has suggested making a move unless a landlord has begun some form of action of his own.
None has suggested the multi-block RTM is or has always been illegal.
None has suggested there is no legal right to collect service charges.
Civil servants advise us that they, too, are observing events before making any decision to revise RTM law.
LKP is not aware of the usual predatory freeholders making an effort to regain control of “their” sites, although there is understood to be one. It will be interesting to observe this dispute closely.
But why haven’t the usual gameplayers in this sector made a move to topple uncongenial RTMs and win back control of their sites?
Suggestions that the Land Registry may refuse to register the sales of flats on a multi block RTM sites, seem to be without foundation. LKP is advised that it has no such plan.
The Land Registry is no longer able to register existing multi-block RTM companies that came into force before March 27 2015, but which have not previously been registered.
The registration of the RTM with the Land Registry is voluntary, and in any case a separate matter to the status of the flat.
Triplerose ruling is here:
Carlex is hardly known for turning away from problems, or just sitting round and waiting.We were ones who brought about three large-scale investigations by the OFT. I think we can also make a fair claim to have done far more than anyone else, save for government officials, to help start the Law Commission report into exit fees.
It took a lot of work to reach our view that existing multi-block RTMs should do nothing to change their current status.
That others reach a similar view is what we now pass on in our article.
The simple fact is we are unable to find anyone who agrees with the proposals from the Right To Manage “Federation” to change where you stand (from what we understand of them).
Lets start by correcting Dudley Joiner’s point about his planned cases providing “legal certainty”.
A lower tribunal case does not provide “legal certainty” for anything other than the specific case heard, assuming that it is not appealed.
The lower tribunal does not set legal precedent, and a different lower tribunal may reach a different conclusion.
The power to set precedent is limited to the higher courts. As we saw in the Triplerose case, that means years of litigation.
CARLEX is not sitting on the fence. We are saying as loudly as we can: think very carefully before becoming part of the RTMF test case.
We have no belief that the RTMF case is certain to succeed, and we believe that it may even put you in a considerably worse position.
Our advice that you should not to change your current RTM status, unless the landlord starts an action, is based on our analysis of the issues.
That our view is echoed by many solicitors, barristers and QCs reassures us that we are calling this right.
We have also discussed the matter with government officials, ARMA, knowledgeable managing agents, the Land Registry and LEASE, whose view is now plain.
We have seen the outline of the case proposed by the RTMF.
Our view is that it may have many potential difficulties. We do not intend to review these proposals in any detail as that would only aid aggressive landlords (some of whom may be delighted that an RTM site has chosen to initiate a case).
If you are still persuaded to be part of the RTMF’s test case, and in particular if you are an RTM director, we would urge you in the strongest possible terms to seek independent legal advice about your own position.
A version of our article above will shortly be appearing in the Federation of Private Residents Association newsletter.