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Freehold and Management Agency Gone Bust

spud2212
Posts: 17 Forumite
The management company who was run by the freeholder of the flats where i live have both gone bust.
Do I need to try and buy the freehold before trying to set up a management company ??
Am confused
Do I need to try and buy the freehold before trying to set up a management company ??
Am confused
0
Comments
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Pretty much everything leasehold here, a real mine of information, if no joy they have a free telephone advice line:
http://www.lease-advice.org/publications/
I would recommend you think VERY carefully before you attempt to take over either the freehold or set up a management company. In general it is an incredible amount of work and there is an incredible amount of legislation to comply with: I would imagine this will be compounded by unpaid bills and incomplete paperwork from your predecessors.Declutterbug-in-progress.⭐️⭐️⭐️ ⭐️⭐️0 -
You need a solicitor to look at your lease to see who has the responsibility for carrying out functions like maintenance of the structure and common parts and insurance.
You also have to understand the distinction between a management company and a managing agent.
A managing agent is simply an individual or organisation of some kind, firm, company etc, that does the day to day managing on behalf of the entity that actually has the management responsibilities. This entity could be the freeholder, or in some cases the lease may provide that some separate company has to maintain, insure, etc.
A management company is generally a company that under the lease has the legal responsibiltiy for carrying out functions such as insurance and maintenance of the strucutre. This can sometimes also be the freeholder, particualrly if the shares in it are owned by the flat owners.
So if the freeholder's managing agent has gone bust and the freeholder has the responsibility under the lease to maintain the structure, insure etc., it is still his responsibility and it is for him to appoint another managing agent. Insofar as you have already paid the agent then you probably won't have to pay again, it will be down tot he freeholder to stand the loss - it was his choice of managing agent.
On the other hand if the lease itself provides that a separate company has the responsibility for maintenance and insurance and that company has been dissolved then it is far more serious, because there is then nobody with the responsibility to do the work.RICHARD WEBSTER
As a retired conveyancing solicitor I believe the information given in the post to be useful assuming any properties concerned are in England/Wales but I accept no liability for it.0
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