Sacked leasehold managing agent tries to silence critics

Below is an attempt by solicitors of a managing agent to stop leasehold residents from criticising a managing agent whose contract has been terminated.

The document is interesting because it is the first time we have encountered an attempt to silence directors of a residents’ management company (RMC).

The other prominent case where a confidentiality agreement was made was when the well heeled residents of St George’s Wharf, Vauxhall, received a £1 million check for excessive service charges in September 2011. This record win came in the form of a cheque from the prestigious Berkeley Group, which builds luxury Thames-side developments. It was a strange episode as the chief executive of Berkeley was quite happy to discuss a pay-out that his company had prevented the residents talking about.

It can be read here

Or: http://www.dailymail.co.uk/property/article-2039128/MARKET-WATCH-Flat-owners-win-record-1m-payout.html

The confidentiality clause in this case has wording that is extremely loose, particularly in urging the directors to use their “best endeavours” to prevent other shareholders – that is, residents – from criticising the out-going managing agent.

It is extraordinary that the document was signed. Would residents, or the RCM directors, subsequently disputing excessive charges be able to refer to the former managing agent in any documentation?

“We would remind you that you and your fellow directors of XXX RTM that following negotiations between your solicitors at XXX and this firm, your company has agreed as part of the settlement agreement reached on XXX not to make or cause to be made any statements that disparage, are inimical to or damage the reputation of our client or their individual officers or members.

Further, as part of the settlement terms, you and your fellow directors of XXX RTM have personally agreed not to make any statements that disparage, are inimical to or damage the reputation of our client or its director Mr XXX personally, and that you and your fellow directors will use your best endeavours to ensure that any current shareholder of XXX RTM does not make any statements that disparage, are inimical to or damage the reputation of our client or Mr XXX personally.

Further, your company has entered into a strict confidentiality agreement under the settlement terms not to disclose the facts and terms of the agreement and the circumstances concerning the termination of our client’s management contract with XXX RTM.

 

Of course, the correct place for such a document is the bin.