‘Fiefdom’ leaseholder directors ‘tried to make fellow committee members sign non-disclosure agreements’
By Harry Scoffin
Enfranchised leaseholders at the South Quay Estate in Wapping, an exclusive neighbourhood, have ousted their entire board in protest at spiralling service charges.
Annual service charges are £4,000, which local MP, Jim Fitzpatrick – patron of LKP and chair of the All Party Parliamentary Group on leasehold reform challenged with the board last year. He received no reply.
Matters came to a head on May 22 at a leaseholder and shareholders meeting when the entire board of directors was shown the door. A new board is set to be elected on June 24.
The Docklands and East London Advertiser reported the dispute relating to the management of 299 flats across seven sites surrounding St Katherine Docks. A legacy of the Greater London Authority, the 1970s development houses some social tenants and leaseholders, with the majority of the properties now owned privately.
Residents kick out entire board on ‘fiefdom’ housing estate
Archant A housing estate in Wapping is in limbo after its entire board of directors was unseated at a fiery emergency meeting. Burr Close in St Katherine Docks. Picture: Polly Hancock South Quay Plaza Estates (Freehold) Limited took over the South Quay estate at St Katherine Docks from Tower Hamlets Council in 2007.
Leaseholders complained about opaque service charges and the high one-off major works at the site, which is managed for the board by managing agent Rendall and Rittner.
The chair Tony Winterbottom, a former senior executive at the now-defunct London Development Agency, had been in post as chairman of South Quay Plaza Estates (Freehold) Limited since 2009.
His bumper pay off from the LDA was sufficiently gargantuan to merit press attention:
Scandal of LDA’s missing millions
Tens of millions of pounds of public money were squandered by Ken Livingstone’s development agency, a report says today. The investigation into the London Development Agency, ordered by Boris Johnson, outlines a string of failings including “ineptitude” and “massive misspending”.
The Advertiser reports that he went on to be the highest-paid special advisor to Lutfur Rahman, the Tower Hamlets politician removed by the courts from the executive mayoralty in 2015.
It has been alleged that the board operated in a secretive manner. Leaseholders were asked to sign non-disclosure agreements when they sought to work on the sub-committees, it is claimed.
These “gagging clauses” would have prevented concerned leaseholders from sharing concerns with neighbours.
Mr Winterbottom and the other former directors deny accusations from leaseholders:
“The probity of the former board was questioned. The facts are what matters. All statutory requirements have been met including a proper financial authority framework.”
One resident, Marian Lewinski, told the Advertiser that:
“We need to stop the unnecessary legal actions. It feels like they are the lords of the manor, and we are serfs.”
While South Quay has obviously not been a harmonious leaseholder controlled site, at least the shareholders / leaseholders have managed to dump a regime in which they had lost confidence.
Not an option, sadly, in many prime London sites which remain in the thraldom of a third-party freeholder, or “responsible long term custodian” as the sector prefers to describe these wholly unnecessary entities.
Related posts:
Southwark council leaseholders see major works bill slashed from £17,000 to £8,000
£146,257 – the highest major works bill ever?
BBC features 50 Oxford City Council leaseholders facing £50,000 major works bill
Oxford leaseholders win first round against £60,000 major works bills
Hurray! Clarion leaseholders fight £32,000 major works bills
Will CMA investigation at last give cheated leaseholders the chance to sue plc house builders?
Hi Everybody,
First post so please be gentle. My husband and I live in an apartment block which is controlled by other people who live here. Is this commonhold? It sounds the same as Katherine’s Dock and what others on here are pushing for. Ive not tried the freehold option. We have terrible problems with our resident board who are entirely lawless and disrespecting towards others. It’s a great cause of concern for many of us here and we don’t know our options. Can we employ a freeholder?
People living communally are always going to scrap.
If your place is dysfuntional you could ask the property tribunal for a section 24 court appointed manager who will run it, and is accountable to the court.
Wow, fast response thanks! As we live here we don’t want to create any problems for ourselves or others as it’s our homes. How do we approach the freeholder? We spoke to a solicitor lady and she said she could help but it was very expensive just to start the process
You couldn’t go for the freehold of a block of apartments on your own.
If it is a leaseholder run company, see what the landlord name is on invoices . Or try the block name in Companies House Search and see what comes up. Check each similar name and look for the registered address and people acting as directors.
If it is merely an RTM company, you have to submit a prescribed form of words application to become a guarantor member with a right to vote. If not an RTMCo, you’ll likely be a shareholder already with a right to vote.
If you are a company member, form an action group with other unhappy company members and have a few volunteers willing to stand as replacement directors and use the Companies Act to sack the existing bunch.
Ignore all threats even from solicitors if you are exercising company member rights. Don’t confuse these rights with the theoretical leaseholder rights.
No need for any tribunal malarkey coz it’s a private company matter.
You need to first establish what the company is and whether you are a voting member, innit.
PS. If you wanna know who the freeholder is – in case it is a different entity to wot is managing – pay £3 to the Land Registry for your title extract. This will name the freeholder.
If it is a separate freeholder not sure much point contacting them.
Hopefully from what you say the leaseholders have control, whether as freeholder company or management company.
Google for information on leaseholder run companies as distinct to leaseholder rights. Knowledge is power.
Hey Paddy,
Thanks for the detailed response. Freeholder is me the leaseholder! It’s a disaster, how do we get out of commonhold? Can LEASE/LKP run the the process? There’s a lot of others here who will pay to relive ourselves of this nightmare. SOS lol
E14, May I suggest you provide your building address to LKP Admin so it can be established what type building you reside in and existing terms.
Hi Alec,
I’ve been told it’s best not to broadcast the issues as it could impact our house value. This is frustrating but most of our retirement pot is in the equity so I’m very cautious. Does the address have any bearing on how we reverse the commonhold or can you advise without it?
I’m also aware from our office intranet that there are others around the country who live in silence with similar issues where other owners run the building and treat it like a “fiefdom”. It should be illegal!
This is why the only serious grouping of leaseholders to form is the National Leasehold Campaign on Facebook: most are leasehold house owners and if they want to shout about injustices they can without worrying about neighbours.
Leasehold flat owners all have different priorities, which is why they are so easy to push around, and overcharge.
You are in the fortunate position of living in an enfranchised block (you are leaseholders from yourselves as freeholders).
You can a/ vote out the directors, under your company articles of association; b/ establish fault, and ask the tribunal for a court appointed manager which takes all management away from you.
Timidly moaning and then saying enfranchised blocks are illegal, and hoping someone will sort out your own mess, is the sort of fantasy that most people abandon around the age of 10.
What a patronising response, absolutely disgraceful way to treat somebody in my situation. You people are supposed to be the ones helping others but when politely called upon for advice and guidance you switch into aggression and condescending statements. I despair, I really do
Admin, You are entirely correct when you assert that leasehold flat owners have “different priorities, which is why they are so easy to push around and overcharge”
However it is important to remember that the genesis of the problems now faced by “virtual” freeholders comes from the exploitation of leasehold flat owners..
It was the sheer hard work and dedication of a few of the exploited leaseholders that got the whole protest movement started.
What followed from the humble beginnings of “having a moan” soon became an outlet for problems advice and breaking news.
What freeholders/managing agents desperately need is to operate under cover.
Without the oxygen of publicity would any of their methods have changed?
Would the Firstport price fixing scandal or the Taylor Wimpey ground rent debacle have been exposed?
Would any one have known of the shady, secretive finance deals that allow Tchenguiz/Long Harbour to operate?
Those that say “don’t say anything because it will affect property values” are very wrong.
What value will their property be if they do nothing, keep their notorious managing agent, keep their onerous ground rents, their onerous and dubious permission fees?
How will they sell, if the development down the road did not remain silent and was for sale without all the onerous monetising rackets?
We can win this. We will win this. Although a painfully long process we are winning this.
E14, You are a leaseholder who along with your neighbours have enfranchised the premises in which you reside. That is, together you have purchased the freehold and own a share of the freehold. As such you are complaining against your own neighbours for their running of the premises.
LKP Admin is quite correct in drawing to your attention your means of remedy. Along with other disgruntled neighbours, you can easily call a General Meeting and vote out the present board of directprs and replace them.with new ones of your choosing.