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You are here: Home / News / Property tribunal tightens up how it appoints section 24 court-appointed managers after the Richard Davidoff debacle

Property tribunal tightens up how it appoints section 24 court-appointed managers after the Richard Davidoff debacle

January 18, 2022 //  by Sebastian O'Kelly

Richard Davidoff, of ABC Estates, advertising the company’s services on YouTube. The property tribunal believes that he still exercises two section 24 appointments over problematic blocks of flats

Block Management Services from ABC Estates – 020 8621 4000

We have a dedicated block management team with 10 staff and have a porfolio of 80 blocks around Great London. We offer the full range of services including t…

Following the debacle of Richard Davidoff’s performance as a court-appointed manager, the property tribunal has issued a “practice statement” to tighten up the process by which the appointments are made.

Broadly, would-be section 24 managers need to be experienced, to have read the lease, inspected the premises and have insurance, a complaints procedure and a client money protection scheme (see in full below).

In addition, they need “membership of a professional body at a level of seniority commensurate with the responsibilities of a Tribunal appointed manager”.

So that rules out Mr Davidoff from future appointments – he presently has two extant ones – as his company ABC Estates was expelled from the Association of Residential Managing Agents last November, and he personally was expelled from the Institute of Residential Property Managers in December.

Richard Davidoff of ABC Estates expelled from IRPM

The practice statement adds:

“Before appointing a person as a Manager, the Tribunal will need to be satisfied that the Manager would have no conflict of interest in taking up appointment. The Manager must also seek to avoid conflict of interest in the placing of contracts and discharging their other duties during their appointment.

“A conflict will occur if the dealings would be regarded by the average consumer as conflicting with the Manager’s obligations under the order.”

The leaseholders and freeholder at Blackheath Road, in Southwark, South London, where Mr Davidoff was appointed through a section 24, certainly did have issues on this score.

The property tribunal ruled last August that Mr Davidoff had “breached his fiduciary duties”.

Richard Davidoff, of ABC Estates, ‘breached his fiduciary duties’ after disastrous performance as a court-appointed manager, rules property tribunal

Projected major works estimated at his appointment at £10,000 were revised upwards to nearly £100,000.

The highly critical ruling found that Richard Davidoff was not a “satisfactory witness”, was arrogant and dismissive of the leaseholders and had proposed to entrust the major works to a company whose sole director was the wife of Mark Reed, the head of block management at ABC Estates.

The tribunal reported the freeholder describing Richard Davidoff’s cash calls as “outright extortion” after receiving “six demands totalling £59,613.70, with no explanation justifying these charges”.

It concluded that Richard Davidoff’s appointment had been a complete failure and that no work had been done to improve the four-flat and commercial unit property in the two years of his appointment.

In the ruling, Judge Robert Latham observed:

“Any criticism of the conduct of the manager will be examined with care, because they are made against the manager in his capacity as an officer of the tribunal.”

The IRPM, which regulates professional qualifications for residential property managers, was also considering a formal complaint against Mark Reed, but he resigned from the organisation before it came to a conclusion.

Mr Reed had also figured in the property tribunal ruling, apparently informing leaseholders that the company entrusted with the major works was Valens Contractors Limited.

“Can you confirm whether any staff members of ABC Estates have any connection to any of the companies that were asked to tender for the work?” a leaseholder asked, according to the tribunal ruling.

Mark Reed replied: “Not that I am aware of.”

This was surprising as the sole director of Valens Contractors Limited was then Lisa Velenski, Mr Reed’s wife, the tribunal noted.

It said in its ruling:

“The relationship between the tenants and the manager broke down irretrievably when they discovered that the company who had provided the lowest quote was owned by the wife of the person [Mark Reed, head of block management at ABC Estates] who had served the statutory Notice of Estimates.”

Last November, Mr Davidoff was in the property tribunal again, as leaseholders had to resort to a right to manage application to remove as he was the sole director of their own residents’ management company.

Richard Davidoff fails to block right to manage – from a residents’ management company where he is the only director

The property tribunal’s practice statement can be read here:

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https://www.leaseholdknowledge.com/wp-content/uploads/2022/01/Practice-statement-December-2021.pdf

Related posts:

Siobhan McGrathProperty tribunal chamber president Siobhan McGrath says Richard Davidoff has two other section 24 court appointments – ‘as far as I can ascertain’ – and proposes a new practice code to encourage section 24 appointees to behave RichardDavidoffRichard Davidoff, of ABC Estates, ‘breached his fiduciary duties’ after disastrous performance as a court-appointed manager, rules property tribunal Sir Keith LindblomWell, can Sir Keith Lindblom do anything about Richard Davidoff’s continuing role as an officer of the property tribunal? IRPM Ricahrd DavidoffRichard Davidoff of ABC Estates expelled from IRPM EDM Richard DavidoffSir Peter Bottomley calls on ministers to listen to ‘whistleblower’ ex-employees of Richard Davidoff (of ABC Estates)

Category: Latest News, News, Property tribunal, Richard DavidoffTag: Mark Reed, Property tribunal, Richard Davidoff, Section 24 manager

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Reader Interactions

Comments

  1. Gulliver

    January 18, 2022 at 2:42 pm

    Practice statements are all well and good but they do not assist leaseholders in the 2x buildings where Richard Davidoff is still a tribunal appointed manager. Those leaseholders still have the onerous task of making Section 24 applications to remove Richard Davidoff.

    With all the negative reporting in the last year about Richard Davidoff and his various companies, you would have thought that the First Tier Tribunal would be taking some kind of proactive measure to safeguard these leaseholders.

  2. Kim

    January 18, 2022 at 7:07 pm

    Surely managing agents pitching for an FTT gig should have to declare whether they have been associated with Management agencies that have previously been found by various FFT’s to have breached statutory legislation. All to easy to liquidate a disgraced company, start another with the same individuals and rotten ethos.

  3. Johnboy

    January 18, 2022 at 7:34 pm

    “Can you confirm whether any staff members of ABC Estates have any connection to any of the companies that were asked to tender for the work?” a leaseholder asked, according to the tribunal ruling.

    Mark Reed replied: “Not that I am aware of.”

    The FTT in the Blackheath Road later noted that the sole director of the ‘winning’ company (Valens Contractors Limited) was then Lisa Velenski, Mark Reed’s wife.

    I am informed that in Nov 2021 the above circumstances formed the basis of a written complaint to the IRPM. In early Dec 2021 the IRPM wrote to Mark Reed and gave him a deadline of 29-12-2021 to respond to the complaint. On 23-12-2021 Mark Reed resigned from the IRPM with immediate effect.

    • Kim

      January 18, 2022 at 8:17 pm

      Well, I do declare. The IRPM is a much use as a eunuch at an orgy when it comes to regulating its members. Ditto ARMA , RICS. Lets hope the new FTT edict deters the usual unscrupulous suspects from pitching for a gig.

      • Gulliver

        January 19, 2022 at 8:40 am

        My scorecard on this matter looks as follows:

        The Association of Residential Managing Agents (ARMA) ought to be given credit for having listened to leaseholders and others by expelling ABC Block Management Limited.

        The Institute of Residential Property Management (IRPM) ought to be given credit for having listened to leaseholders and others by expelling Richard Davidoff and launching an investigation into Mark Reed which resulted in Mark Reed resigning with immediate effect.

        Propertymark ought to be given credit for having listened to leaseholders and others by expelling ABC Estates.

        All those that persevered with their complaints to the above organisations about Richard Davidoff, Mark Reed and ABC ought to go to the top of the class.

        The First Tier Tribunal (FTT) and the Property Redress Scheme (PRS) ought to go to the bottom of the class.

  4. Someday

    February 10, 2022 at 9:01 pm

    The FTT really should be reflecting on its purpose – what is it actually stand for and who does it serve would be good starting points.

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