The right to appoint a manager

The manager appointed by the FTT is not appointed to favour the tenants or the landlord. The manager is appointed to oversee a scheme of management and acts independently of the parties.

Effectively the manager is a servant of the FTT. The manager’s powers are derived from the order appointing him/her and can therefore allow for powers that are not in the lease. For example, the order appointing the manager may be worded to allow the manager to recover costs or fees which the lease does not permit recovery of. 

Who can be a manager?

Although there is no requirement that an FTT appoint a professional manager, FTTs are not usually keen to appoint tenants who suggest that one of their own number be appointed. It is therefore advisable that tenants propose a professional management company as one of the most common grounds for rejecting a proposed manager is a deemed lack of experience.

Remuneration of the manager

The FTT has the power to provide for remuneration of the manager to be paid by either the landlord or the tenant or to be shared. The starting point however should be that the landlord will pay the costs of the manager, which are not recoverable from the tenants under their leases. In either case, it is important to ensure that the terms of the order are clear as to who is to pay the manager and what the manager’s fees should be.

Pre-application procedure

The FTT regards the appointment of a manager against the wishes of the landlord to be a draconian step and will usually require certain preliminary stages to be completed. The first step is for the tenant(s) to give a ‘preliminary notice’ to the landlord and to any other person who has management duties under the lease, ie a management company. A manager whose duties are not due under the lease, for example a managing agent, will not need to be served with the notice.

Grounds

In order to exercise its powers of appointment, the FTT must be convinced that it would be just and convenient in all the circumstances to do so and:

That the person complained about is in breach of an obligation under the lease relating to the management of the property; or

Unreasonable service charges have been made or are proposed or are likely to be made; or

Unreasonable variable administration charges have been, or are proposed or likely to be made; or

That there have been breaches of the relevant codes of practice.