17. Right to Manage company set up by the tenants under statutory rights

A Right to Manage (RTM) company is an entity formed by leaseholders of a leasehold property with the legal right to take over the management responsibilities of the property from the landlord or the management company named in the lease. This right is granted by the Commonhold and Leasehold Reform Act 2002 in the UK, allowing leaseholders to collectively manage their property's maintenance, repairs, and other related matters. 

The establishment of an RTM company empowers leaseholders to have more control over the property's management, ensuring that decisions are made in their best interests. The process involves meeting specific legal criteria, including the minimum number of qualifying leaseholders who wish to participate in the RTM process. 

Once an RTM company is set up and recognised, it takes on responsibilities such as collecting service charges, arranging maintenance and repairs, selecting contractors, and making decisions related to the property's well-being. The RTM company operates under its own Articles of Association, outlining its structure, decision-making processes, and responsibilities. 

It is important to note that an RTM company does not grant leaseholders ownership of the freehold; it only gives them the right to manage the property's affairs. The landlord's interests are still safeguarded, and certain obligations, such as major works, remain the landlord's responsibility. 

Leaseholders considering forming an RTM company should carefully follow the legal process outlined in the Commonhold and Leasehold Reform Act 2002, including notifying the landlord and adhering to specific timelines. An RTM company provides leaseholders with a collective voice and greater influence over the property's management, ensuring their needs and preferences are taken into account.