Setting up an Right To Manage Company is a very straight forward business and can be done through a solicitor, company agent or by the leaseholders themselves. As with all businesses in the UK the company must have Articles of Association and a Memorandum of Association. 

Any number of qualifying leaseholders can set up an Right To Manage company. At the the time of the application, the membership of a Right To Manage company must comprise at least 50% of the 'qualifying leaseholders' in the building. A qualifying leaseholder is the owner of a flat (or flats) where the  original term of the lease was a minimum of  21 years. The leaseholder does not have to live in the flat nor do they have to have lived in the flat. There is no limit to the number of flats within the; building owned by the same 'qualifying leaseholder'.

Notice Inviting Participation

Once the Right To Manage company has been registered with its original members it must formally invite the rest of the qualifying leaseholders in the building to join the company. It is a legal requirement that all qualifying leaseholders in the building have the right to join the company. It is also important to remember that the landlord of the building also has this right.

The Notice inviting the qualifying leaseholders to join the Right To Manage Company (‘the Notice Inviting Participation’) must be in a prescribed form (as set out in Statutory Instrument (2010 No. 825) which is accessible from the OPSI website (www.opsi.gov.uk).

The Notice Inviting Participation has to include the following information:

1. That the Right To Manage company intends to apply for the right to manage the building.
2. The names of the members of the Right To Manage company.
3. That the leaseholder is formally invited to join the Right To Manage Company
4. The Right To Manage company’s registered number and the address of its registered office
5. The names of the directors of the Right To Manage company and if appropriate, the company secretary.
6. The name of the landlord and any other party to the lease other than the leaseholders (an example may be an existing management company).
7. That the Right To Manage company is going to take over the landlords management responsibilities under the lease, including the enforcement of the tenant’s covenants in the lease and the granting of any approvals required under the terms of the lease. Where the landlord has ownership and control of any flats or other areas in the building, the notice must stipulate that the Right To Manage will not extend to these.
8. If the Right To Manage plans is to employ a managing agent-details of any managing agent that the Right To Manage intends to employ or if they have not already chosen an agent, the fact that they intend to do so.
9. A copy of the Articles of Association and the Memorandum of Association.

The notice can be served either by post (especially if the qualifying leaseholder does not live in the flat) or by personal delivery to each of the flats within the building.

It is important that the Notices Inviting Participation are correctly served, as it is common for a landlord to challenge the Right To Manage on the grounds that the Right To Manage company is not properly constituted in that it failed to comply with regulations governing  the service of the notices.

See  Part III –‘ Making a Claim for the Right to Manage (‘RTM’)  available on this website

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