Q&As
The tenants of a building have exercised their right to manage and a right to manage company (RTM company) has been established. On assignment, each lease requires the incoming tenant to enter into a deed of covenant with the former management company (whose duties have now been taken over by the RTM company). Is the RTM company required by section 98 of the Commonhold and Leasehold Reform Act 2002 to notify the landlord and obtain its approval of the form of the deed of covenant?
The Commonhold and Leasehold Reform Act 2002 (CLRA 2002) entitles a right to manage company (RTM company) to exercise the management functions ordinarily vested in the Landlord (or a management agency) in respect of residential property. An RTM company is a company limited by guarantee and whose membership is restricted to qualifying tenants of the relevant building.
The structure of CLRA 2002, s 98 is firstly, to vest in the RTM company the functions in relation to the grant of approvals to a tenant that would otherwise be the functions
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