Taking back control of a Residents Management Company, a case study, pt 2
In Part 1, we saw that it wasn't clear who the RMC members were.
This has pretty serious implications. Residents cannot ascertain which of their neighbours are members of the RMC and thus have formal control over board of directors that chooses the estate manager.
Roughly speaking, we'd expect one member per dwelling (i.e., if we count up the number of houses on the estate, and add it to the number of flats, that's how many members there should be). But the RMC's articles suggest there may be non-residential units that carry RMC membership rights/obligations too.
Tenure mix
Focusing just on the dwellings, of which there are over 300, there seem to be dozens of houses and flats. There are three patterns of ownership:
- freehold houses, which the housing association ("the HA") has sold on to individual homeowners
- leasehold flats, where the flat owner owns the lease outright
- Shared Ownership flats, where the flat owner owns less than 100% of the lease and the head lease is owned by the HA.
There might also be flats and houses that are owned outright by the HA.
Role of Shared Ownership
According to Land Registry data for the freehold of the original plot of land comprising the estate, there are about 100 long leases for individual dwellings on the estate. Some of those leases will be Shared Ownership leases.
(It would be helpful at this juncture to pause and mutter a ritual curse upon those who never miss an opportunity to pretend that Shared Ownership isn't a form of leasehold; they do nothing but derail conversations).
If, on the other hand, one downloaded the title register for an individual flat, one would find two or three entries:
- a freehold title for the block of flats or the wider estate, plus a leasehold entry for the lease of the flat
- a freehold title for the block of flats or the wider estate, plus TWO leasehold entries, one for a head lease held by the HA, and the other an underlease held by the individual Shared Ownership leaseholder
From the point of view of of power within the RMC, it makes a big difference which of these owners is the member of the RMC referrable to that flat: does the HA represent a Shared Ownership flat in the RMC, or does the Shared Owner herself/himself?
There are dozens of Shared Ownership leaseholders on the estate, and they have no idea whether they can vote in the RMC (and similarly whether they can participate in calls to force an extraordinary general meeting of that body, or be elected as its directors). And if they don't have the vote, then the HA likely has the vote in respect of their flats, meaning the HA has a very large number of votes in the RMC ...