QUESTION
Please would you be so kind as to answer some questions on qualifying tenants?
1. Would a partner(girlfriend/boyfriend), having no legal status on the qualifying tenants Lease, be a qualifying tenant too?
2. Is a non qualifying tenant allowed to vote, participate or be counted in an enfranchisement application?
3. Is a non qualifying tenant allowed to vote or participate in RTM matters?
4. Is a non qualifying tenant allowed to be a non elected Director of (a) A RTM (b) Enfranchisement?
ANSWER
It appears this enquiry is relevant to qualifying tenants relating to two separate Acts of Parliament:
1. Qualifying tenants where the right of collective enfranchisement is concerned, pursuant to the Leasehold Reform, Housing and Urban Development Act 1993 (“The 1993 Act”), and;
2. Qualifying tenants where the right to manage is concerned, pursuant to the Commonhold and Leasehold Reform Act 2002 (“The 2002 ACT”).
In order, the responses to these questions are:
Collective Enfranchisement (question 1 and 2)
· Persons not party to a lease would not be regarded as qualifying tenants, so a partner/boyfriend/girlfriend would not qualify.
· Non-qualifying tenants are not allowed to participate, vote or be counted in an enfranchisement application, nor for RTM
· In any case, where a person was party to a lease, the 1993 Act at Section 5 (subsection 3) confirms that only one qualifying tenant per flat is allowed and the same provision is confirmed with RTM in the 2002 Act at Section 75 (subparagraph 5).
Right To Manage (question 3)
· Non qualifying tenants would not be allowed to be members of an RTM Company, therefore they would not be party to any company matters, nor would they be allowed to vote on Company business. However, I would argue that it would be prudent to include non-members of an RTM Company when discussing matters affecting the premises as, members or not, everyone in the block will be paying a service charge. If something goes to a vote, non-members will not be given the chance to participate in the vote.
Election of Directors (question 4)
· All Directors have to be correctly elected, whether for an RTM Company, or a company set up for the purpose of enfranchisement. The election of Directors is pursuant to provision in the Company’s Articles and if these Articles are not adhered to, the election of a Director could be regarded by other members of the company as being unconstitutional and the appointment can be vetoed.
Some things to remember; an RTM Company’s Articles must follow a prescribed format - the prescribed Articles for an RTM Company are more flexible than standard Articles as they do not actually specify that a Director has to be a ‘dwelling owner’ (i.e. a party to the lease). That is to say that anyone who is correctly and constitutionally elected can be a Director of an RTM Company. That is, of course, unless a resolution has been passed to adjust the Articles post RTM-acquisition and this provision is altered.
For a company set up to exercise the right to enfranchisement, this requirement is not quite so strict; instead of prescribed Articles, the Articles need only to state that the company has been incorporated for the specific purpose and confirm the premises to which the enfranchisement claim relates. Check the articles in any case and see what is provided for; it may well be that non-members can be elected to the Board.
Liam Furr, Director of Property Management at PMS Managing Estates Ltd
