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Leasehold Reform Update – Recognised Tenants’ Associations

October 2018

Section 130 of the Housing and Planning Act now gives the secretary of a tenants’ association a right to obtain from the landlord contact information for other leaseholders in a shared block provided that leaseholders have individually consented to their information being made available in this way. This is to be put into effect by recently published secondary legislation (regulations). The new regulations can be seen here and will come into force in England only on the 1st November 2018.

The aim of the regulations is as follows:

  1. To address the situation where tenants’ associations face difficulty in making contact with leaseholders in the first place in order to ascertain whether they wish to join the association. Making contact can be difficult for a variety of reasons. The leaseholder may be a non-resident landlord, the leaseholder may only occupy the property irregularly. The property could be owned by a company, or the property is held as an investment. The consequence is that, unable to make contact with other leaseholders within a building or development, it is difficult for an association to reach the qualifying criteria; and

  2. Make it easier for tenants’ associations to be formally recognised. Some landlords resist efforts of leaseholders to form residents’ associations in general, or refuse to work with those that are formed in any meaningful way. This means that leaseholders are sometimes driven to use the First-tier Tribunal (Property Chamber) (FtT)to secure formal recognition for their associations under section 29 of the Landlord and Tenant Act 1985.

    In deciding whether it should formally recognise an association, the FtT requires a “significant majority”. The current threshold, set out in non-statutory guidance for the FtT, requires that not less than 60 per cent of qualifying tenants need to be members. The 60 per cent threshold has been criticised by the Upper Tribunal (Lands Chamber) in the case of Rosslyn Mansions Tenants’ Association v Winstonworth (2015)18. In that case the Upper Tribunal determined that 60 per cent was a guideline and not a benchmark. Therefore, after consultation, the Government has decided to:

    1. reduce the qualifying threshold to so that an association can only normally be recognised (by a Tribunal) if its membership includes at least 50 per cent of the relevant qualifying tenants; and

    2. to replace the existing non- statutory guidelines by setting out in the regulations the matters which the Tribunal must have regard to in giving a certificate

More information you might find useful:

LEASE is governed by a board, appointed as individuals by the Secretary of State for the Ministry of Housing, Communities & Local Government.

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