Management Company - legal issues


I own a flat in a small block. Most of the flat owners have bought into the freehold buyout and we all pay management charges to a management company that was set up when the freehold buyout took place.

I have recently discovered that the Management Company was set up as a Limited by Guarantee company and that none of the flat/freeholders have an interest in the company. They are not listed as members or directors. There are only 2 directors of the company who do not own any of the flats.

The management company seem to be free to set budgets and charge what they want for managing this block of flat and the flat/freeholder don’t seem to have any rights to challenge or agree any of this.

Is there anything that can be done about this?

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The freeholders can sack the management company and appoint another one if they don’t like what they’re charging so unless they’re all rich and don’t care, its likely the charges are not excessive. What sort of charges are you talking about?

Exactly right if a majority vote for it., the Management can be sacked . You can form your own management company.

There are a number of items on the budget that are quite excessive for things that never get carried out. The management company never seem to consult with the freeholders just impose charges every year.

Instead of sacking the company, I would like to find a way to get them to assign freeholders to the board of directors and hold AGM’s - so that they are accountable.

They are supposed to have an AGM and give out accounts every year. Also if I remember correctly the fee they charge for admin has to be disclosed. It is a money spinner and in my small amount of experience you wont get anywhere unless you all have control 100%.

Give the Leasehold Advisory Service a call to discuss your options.