The Law Commission has rejected a concern raised by LKP that barrister Justin Bates is employed to reform right to manage legislation while engaged by an offshore landlord to try to prevent yet another one.
Mr Bates was a controversial choice by the Law Commission in the view of some leaseholders as he has established a “cottage industry” attempting to thwart right to manage applications by leaseholders.
LKP wrote to the Law Commission:
“It inevitably adds to the perception of there being something not quite right when the barrister funded by wealthy landlords to help break the [right to manage] law over many years is now paid to help fix that law, while at the same time continuing to earn an income from continuing to attempt to break that law.”
Mr Bates is employed in a case involving Wharfside Point South RTM Co Limited, a site in Poplar, east London, which is seeking right to manage from Jersey-based CFIF Nominee Limited.
This is, in fact, part of the portfolio of ground rent speculators Clive and Paul Rayden, who used to own County Estate Management until 2008 before it was scooped up by Peverel / FirstPort.
Mr Bates is assisted in this task by solicitor Janice Northover, whose handiwork includes the Dennis Jackson forfeiture case:
Dennis Jackson at Plantation Wharf: An £800,000 forfeiture over-turned by LKP
The Law Commission has rejected LKP’s concerns.
Phillip Golding, chief executive of the Law Commission, writes:
“I have to reiterate my position that we disagree with your observations questioning the impartiality of one of the lawyers working on our RTM project.
“All lawyers employed by the Commission abide by the Civil Service Code and their own professional obligations, ensuring they act in the interests of the public we serve. The Commission greatly values our lawyers’ experience and knowledge and believe that it helps to bring a balance of views to law reform projects.
“The output of the Commission must be agreed by all five independent Commissioners before being published, ensuring no individual can affect Law Commission recommendations to suit their own agenda.”
LKP had earlier informed the Law Commission that RTM directors of two prime London sites would not take part in its right to manage consultation because of the involvement in the process of outside lawyers still active for aggressive landlords in the leasehold sector.
Here are a selection of Mr Bates’s RTM cases:
No.1 Deansgate wins epic RTM battle, as freeholder throws in the towel at the Court of Appeal
Israel Moskovitz loses epic Elim Court right to manage battle in landmark Court of Appeal decision
Pensioners lose leasehold right to manage application for the third time
Biggest right to manage victory ever at Century Wharf, Cardiff
Lawyers fighting right to manage get their legal fees slashed from £28,117 to JUST £2,883!
Israel Moskovitz fails – again – to appeal against the Regent Court right to manage – Better Retirement Housing
An attempt by freeholder Israel Moskovitz to appeal against the granting of right to manage to Regent Court has been turned down by the Court of Appeal. Israel Moskovitz, who owns Avon Freeholds, applied for leave to appeal to the superior court after his appeal to the Upper Tribunal (Lands Chamber) failed in August.
‘Must Regent Court pensioners take you to court AGAIN, Mr Moskovitz’
The pensioners of Regent Court, in Plymouth, face the prospect of another encounter in court with their freeholder Israel Moskovitz after being presented with a £140,000 bill to pay for a new roof. The roof was damaged by storms in April 2012, but insurers AXA claim the condition of the roof would have voided the policy.
Related posts:
Israel Moskovitz fails – again – to appeal against the Regent Court right to manage
Israel Moskovitz ‘unappealing conduct’ reported in The Oldie
Barrister Justin Bates delays ANOTHER right to manage by nearly two years. Corrie and Man United stars among the ‘victims’
Barrister Justin Bates fails to block right to manage on the grounds that leaseholders’ company name did not include ‘RTM’ in the title
Freeholder’s barrister Justin Bates named in Parliament yesterday. And Benjamin Mire. And Tchenguiz. And Yianis. And Israel Moskovitz …
Law Commissioner wants to meet YOU: November 3
I have no idea why RTM should not be s straightforward, easy process, with highly competent and skilled, independent managing agents,
Our homes or the freeholders investment, need management right? Surely everyone wants well managed, well kept properties! But no. Of course they don’t. The freeholders have no interest in maintaining high standard in the reversions. Most of the time they stand to profit more by devaluing the long leases, and redeveloping when things get beyond repair. This nightmare scenario is actually happening. Look around you.
London is infested with dodgy landlords and puppet managing agents, whose only interest is to milk the leaseholders.
It’s about time the government faced this situation, and tackled it to the source.
Mr Bates being a controversial choice by the Law Commission is like the Poacher turned Gamekeeper. He has an established “cottage industry” where he has been paid to thwart the Right to Manage (RTM) of many developments on technicalities. Does this say more about the Law Commission?
Will the changes to come benefit leaseholds if he can sees what is likely to happen and uses his expertise on behalf of the RTM developments seeing and being the part of the wind of change.
As a barrister he can choose his workload, maybe in the future he may see more benefit from supporting the RTM as there will be a massive change as the leasehold laws begin to work more in favour of the leaseholder and not the wealthy landlords?
“LKP had earlier informed the Law Commission that RTM directors of two prime London sites would not take part in its right to manage consultation because of the involvement in the process of outside lawyers still active for aggressive landlords in the leasehold sector” – Can you blame them?
David we could have an insider in Mr Bates who whilst not particularly he is very prominent in leasehold. Maybe the others have a conscience (wuppps) should I have said that?
I think Justin Bates is the perfect candidate! Whilst paid, he acted for his clients as instructed. From what I understand, he has won alot of cases and whilst yes he had clients who were less than credible, that should not tarnish his reputation, if anything elevate it.
I want winners on my team, and if this is to happen, I think having him on ‘leaseholders’ side makes his appointment perfect. Time will tell if this was a great move or not, but its like picking the best player, you want him on your team if you got a chance of winning. Put aside the hate for the freeholder clients who have taken liberties, thats separate to the abilities and experience of Justin!
“I want winners on my team, and if this is to happen, I think having him on ‘leaseholders’ side makes his appointment perfect”.
Desmond, The Law Commission is a body appointed by government to look into leasehold and make recommendations on reform, they are working within a remit set by government. Though some would disagree – myself amongst them, the Commission is on nobody’s side, and most certainly not on the side of leaseholders. Justin Bates appointment suggests a supreme arrogance, par for the establishment course I think.
I will never tire of making reference to Crispin Blunt’s submission to the Law Commission. In essence, often explicitly, Crispin Blunt opined that powerful vested interests (of all kinds) had conspired against ordinary, and unsophisticated, house buyers for their own pecuniary benefit. The legal profession among them.
This is the problem we have as leaseholders. It can be argued that The Law Commission has a horse in the race, there is no argument about Justin Bates having one. His appointment, at best, was a misjudgement – that is being kind. At worst it is The Law Commission expressing, not just arrogance, but open contempt towards leaseholders.
Thank you very much, LKP for having objected to the involvement of this lawyer by pointing out that “the barrister funded by wealthy landlords to help break the [right to manage] law over many years is now paid to help fix that law, while at the same time continuing to earn an income from continuing to attempt to break that law.”
With regard to the 110 Leasehold flat-owners on my own estate who live in seven different blocks, we are well aware of the ineffectiveness of the current RTM legislation and how the current RTM legislation benefits the Commercial Freeholders of those blocks. We are also aware that the Commercial Freeholder and the Developer connived in using a legal loophole to deprive our 110 Leasehold flat-owners from being offered their Right of First Refusal to buy their Freeholds.
It is obvious that a lawyer who is paid handsomely by Commercial Freeholders to ensure that arrangements are to the Commercial Freeholders’ advantage should not have any say whatsoever in the workings of a committee that has been instructed to reform Right to Manage. Such a lawyer has a clear and an alarming CONFLICT OF INTERESTS and no amount of explanation and insistence from the Chief Executive of the Law Commission can excuse such a conflict of interests.
The Law Commission’s current Consultation Paper is very disappointing with regard to reforming RTM. In fact the paper seems to suggest that there is no need for any reform to benefit Leasehold flat-owners living in multiple blocks on a single estate.
For example, the Commission acknowledges in 6.47(1) of the Consultation Paper that “It is not possible for leaseholders in multiple buildings together comprising an estate to purchase collectively the freehold of the entire estate” but then the Commission states in 6.48 that “Where leaseholders across an estate consisting of multiple blocks of flats are sufficiently motivated and organised, it is possible for them to acquire the freehold of the entire estate. All that is required is for each block to enfranchise collectively, with each naming the same nominee purchaser and each claiming different areas of the common parts (which together make up the entirety of those parts). When all the transactions have completed, the entire estate will be within the ownership of one entity.”
We are not aware that it is already possible for flat-owners in multiple blocks on a single estate to join together to acquire the freehold of the multiple blocks on that one estate. The Right To Manage legislation of 2002 does not appear to allow for the acquisition of the freehold of multiple blocks on a single estate by a single Residents Management Company. But if it is possible for Leaseholders to do so, as the Commission’s Consultation Paper may be suggesting, then why is it not stated in the information published by The Leasehold Advisory Service (LEASE), who clearly advise Leaseholders that:
“The right relates to a building, so, in an estate of separate blocks, each block would need to qualify separately and an individual RTM notice served. In the case of an estate of flats under the same management, it would be sensible to take over the management of the whole estate, but this would have to be accomplished by application in respect of each separate block.”
https://www.lease-advice.org/advice-guide/right-manage/
The Law Commission’s Consultation Paper appears to contradict the above statement of The Leasehold Advisory Service, a service which leaseholders depend upon and which was created to give people “Government funded, independent advice on residential leasehold”, so can it be that LEASE’s advice is incorrect?
The following pdf paper, prepared by two specialists in residential property law, supports LEASE’s advice that multiple blocks cannot pursue RTM as a single group!
https://www.trowers.com/uploads/Blogs/PLJ332_p06-09_Bethune.pdf
This paper states, among other things, that:
The Court of Appeal’s decision in Triplerose Ltd v Ninety Broomfield Road RTM Co Ltd [2015] has, at least for the time being, ended the debate on the extent of tenants’ autonomy under the Right to Manage (RTM) regime under Part 2 of the Commonhold and Leasehold Reform Act 2002 (CLRA), which intended to allow long leaseholders to step into the shoes of their landlords when they exercise the RTM. Gloster LJ’s narrow interpretation, in particular of ss73 and 74 of the CLRA, has confirmed that only tenants of flats in single blocks can exercise the RTM, even if they are part of a wider, physically and contractually connected estate.
. . .
The legislation addressed the perceived mischief of incompetent –or worse – landlords pursuing their own agendas to the detriment of the leaseholders for whom their flat represented their most valuable possession. It is unfortunate, then, that the drafting of the statute does not clearly achieve this. Section 72 deals with the type of premises which qualify under the Act and the percentage of qualifying tenants. It is probably unarguable –although counsel for the Garner Court RTM, did try – that ‘premises’ can only mean single blocks of leasehold units. What s72 does not tell us is whether an RTM company can manage one or more premises. The landlord’s counsel submitted that on the basis of s73 it could not. If ‘premises’ meant a single block as it did in s72, then the reference to ‘premises’ in s73(2)(a) and (b) must logically mean that single block.
. . .
The Law Commission itself had sought views on the practicality of multi-block RTM companies, but nothing caused it to redraft the relevant sections of the Bill before laying it before the Lords. The Lords’ debate does suggest that Parliament did not have the appetite to engage with the complexity of multi-block RTM companies.
Of course the Commission has added at 6.48 of its Consultation Paper the qualification that multiple blocks can acquire RTM if they are “sufficiently motivated and organised” , so I wonder if the Commission has fully understood the advice which Leaseholders, including myself, have passed to it, namely that in some blocks of flats on any estate there are often owners who may be too aged or too administratively unable to pursue RTM for their individual blocks. They simply don’t have the confidence or the know-how to do so: hence they need to be subsumed within a larger single group consisting of all of the Leaseholders on their estate so that all of those other individuals (in other blocks) who are administratively able may lead all of the estate’s Leaseholders towards the acquisition of RTM by a single process conducted by the single group.
We all hoped that the Law Commission would immediately acknowledge the need to support such a helpful improvement in the current Right To Manage legislation. But it hasn’t! Why not?
Maybe the reason is very simple: the interests of those Commercial Freeholders who exploit Leasehold flat-owners are being firmly represented in the Law Commission by the involvement of a lawyer who works in the interests of Commercial Freeholders!
The key to radical reform of land/residential property is this: -keep the self-serving (billing) law industry out; -accept the principle that homes are sacred, cannot be sold/owned by third party investors
‘An Englishman’s home is his castle’ but never for leaseholders.. So said Henry v111 after Ann Boleyn’s execution.
Leaseholder oppression belongs to the dustbin of history and oppression. Yet the Law Commission is upholding oppression by disingenuous tinkering with laws that were repealed by every other colony of the empire.
Agreed but it is a political decision to repeal our leasehold laws. The Law Commission is only the more than willing agents of government.
– the Commission is working to the remit of this government, and will by every means possible come up with reforms which will maintain
It`s what you call a man on the inside job!
There is only one solution – end leasehold.
There is no doubt about it – Mr Bates has a phenomenal legal brain. I just question his commitment to phasing out this feudal tenure (like all the other common law jurisdictions around the world have). Turkeys don’t vote for Christmas! Whose side is he really on when he assists the Law Commission? The offshore billionaire, or the leaseholders he has helped terrorise on behalf of his client over the years? Is leasehold reform just a case of “polish, not abolish”?
Can’t and own’t comment on this barrister. Barristers earn what they can where they can. The worse a law is written, the more they can earn one assumes. Ironic that so many legislators seem to be from the profession? Could they at least not apply all that expertise when drafting laws in the first place?
The 2002 Act was a dog. Right To Manage in my experience looks designed to fail from the orf, perhaps due to some clever lobbying at the time?
Never mind the huge claim hurdles and the nonsense spouted in the 2015 Triplerose decision that removed the right for multiple blocks in the same freehold to claim RTM. (Triplerose ignored simple facts: membership of an RTMC gives voting rights to individuals. Leaseholders without RTM have no meaningful power to protect their interests under a freehold landlord/agent without endless and often fruitless and expensive trips to court. And exactly how many leaseholders tried to claim the right to manage freeholds in other parts of the country where they did not live and could not qualify under that freehold – as fretted over by the judges?).
Success in an RTM claim does not predict success for an rtm company. Does anybody research how many rtms survived beyond 2 to 5 years as per Companies House records?
An RTMC’s early demise is pre-built into the 2002 Act. Yes, there is no defined minimum membership after acquisition, but which sane lessee is going to volunteer to be a company director with all this entails with only a diminishing few apathetic members who have no liability to fork out for anything other than the service charge? In my experience, lessees do not quickly reach for their wallet.
How do these hapless amateur directors pay for that expensive counsel’s opinion which they would need for their D&O insurance to kick in to cover their backs during a problem?
RTMCs cannot charge even for its D&O insurance despite usually saving the service charge a huge fortune from previous inflated block insurance.
RTMCs cannot charge a basic management fee either. Leases tend to refer only to ‘managing agents’ fees. Alert barristers and cynical lessees alike tend to pounce on these details. This forces RTMCs into the hands of so-called ‘professional’ agents. Said many times, never yet met one of these.
RTMCs (like RMCs) are governed under private company law despite not engaging in commerce, not selling products, not collecting donations from the public, and existing entirely to manage private premises. Few sane lessees merely wanting a fair deal in managing their homes relish taking on company law responsibilities.
RTMCs are defined as guarantor companies rather than shareholder companies. Unlike shares, guarantees die with sale and new lessees have no impetus to join the RTMC because they never experienced any hassle. In my experience they do not join, so the company gradually withers while the hapless directors become more ever isolated from support. AGMs are not attended, and forget asking for member contributions to solve any problem.
This leaves the field open to a more exploitative type of cove who may be rather happy to hijack an apathetic RTMC for one’s own ends. Common enough if you follow the forums. Read of agents hijacking their client company without any lawful authority to do so – relying on the apathy and gullibility of ill-informed lessees who refuse to learn.
RTM Model Articles offer many unusual powers – including investing, borrowing, lending to anyone (not just members). What the model articles do NOT do is let an RTMC manage the premises in the same way a freeholder or his/her managing agent.
An RTMC:-
1. Cannot require lessees to pay all reasonable costs, charges and expenses for defaulter action. Freeholders do not have to authorise s146 action for an RTMC, and anyway want indemnifying by the RTMC.
2. Cannot operate its own continuous trust bank account for holding/expending service charges if employing an agent. Failures in reporting leave directors expected to authorise expenditure and take ultimate responsibility without sight of something as basic as a bank statement.
Tech 03/11 and the RICs Code prove little protection in seeking basic cash book information from agents. Whatever the RICS code may say, handovers between agents are not seamless, and months may pass before the client RTMC is updated, if ever, on the financial situation.
3. Cannot collect a per unit management fee under the service charge if self-managing because leases usually limit such fees to ’employing a managing agent’.
4. Cannot recharge for its directors and officers insurance without which volunteers would be foolish to manage any company, this despite freeholders being free to charge huge commissions and other costs in the absence of RTM.
5. Cannot issue basic consents without giving a freeholder power to object. Freeholders can effectively duplicate charging a ‘consent’ fee, even though the RTMC is empowered to scrutinise the matter and freehold landlord cannot act on delegated functions without agreement of the RTMC.
The leaseholder can end up liable for two ‘consent’ fees, which could include duplication of fees for solicitors, surveyors and other professionals should a freeholder decide to need this expertise to make no objection.
Most lessees do not release that RTM does not prevent a freeholder building right over their heads, or entering any demise upon notice on a ‘fishing’ expedition.
It is no surprise that over time freeholders and agents have turned RTM in practice into a sort of Dad’s Army caper for the unwary. In my opinion anyway.
The only way to operate seems to me is to treat your leasehold as long rental (deal with it) and plan to die before your lease expires. If you have hope of no mortgage at some point, hope that the service charge and ground rent will never overtake local rents. That’s a real kick in the guts after forking out the purchase price.
Meanwhile save every penny for the huge bills that will land on your mat and NEVER EVER challenge the landlord or agent. Simply suck it up and pay.
After all, that is how leasehold is designed to work by governments of all persuasion. It is a multi billion caper. Do you seriously think anyone will reform it?
Countries that did abolish leasehold had the happy situation of independence in law from England. Not an option in England.
Interesting comments, Paddy. We have looked at RTM and employing a managing agent. Having a new system which motivates reluctant leaseholders is a big issue. I hope you have said the same to the Law Commission, and Select Committee. Why can’t England and Wales follow best practice used elsewhere, get rid of leasehold, and allow individual leaseholders to buy a freehold share at any time ? (as well as part of a group).