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Swift Resolution of a Block Management Handover Dispute

A managing agent recently contacted Brady Solicitors upon recommendation from The Property Institute (TPI) as they were facing significant difficulties when taking over the management of a residential block. Despite repeated attempts for over 3 months, they were unable to obtain key documents and service charge funds from the outgoing managing agent. Without these, the new managing agent could not carry out essential maintenance, verify leaseholder accounts, or lawfully issue the next round of service charge demands. 

The Challenge

The outgoing managing agent had failed to:

  • Provide service charge monies due under Section 42 of the Landlord and Tenant Act. 
  • Hand over critical documents such as fire safety risk assessments, insurance details and service charge records. 

Having not even received a single response from the exiting managing agent, this left the client in an impossible position. Leaseholders had already paid their service charges, so re-demanding the monies would have constituted a breach of lease. At the same time, the agent lacked the funds and information needed to maintain the development and plan for future demands.  

Our Approach

Brady Solicitors reviewed the history of the managing agent’s attempts to secure a handover and advised on the legal framework governing the situation. We highlighted that: 

  • The service charge monies are ringfenced under Section 42 of the Landlord and Tenant Act 1987. 
  • Retaining documents belonging to the RMC can constitute a breach under the Torts (Interference with Goods) Act 1977. 

We then helped the client structure their communications clearly and effectively, setting out: 

  1. The remedies being sought (handover of funds and delivery of all management documents). 
  1. The statutory basis for their entitlement.
     
  2. The consequences of continued non-compliance, including issuing a court claim for delivery up of goods. 

The Outcome

 After over three months of failed attempts by the managing agent, Brady Solicitors’ advice proved decisive. Within just 10 days of issuing the carefully drafted correspondence, the outgoing agent complied in full. All required documentation was handed over and more than £10,000 in service charge funds were transferred to the new managing agent. 

This swift resolution meant the managing agent could immediately begin carrying out necessary maintenance works, regularise the blocks service charge accounts, and restore confidence among leaseholders. 

Client Feedback

“After sending communications outlining the legal challenge and the outline of our plan of action in event of non-compliance we have been provided with the requested sets of accounts and over 10k in Service Charge funds relating to it! Your assistance is greatly appreciated.”

Conclusion

Situations like this are unfortunately not too unusual when blocks are handed over between managing agents. Knowing the legal remedies available and how to pursue them is crucial in ensuring the timely transfer of funds and documentation. The wording and structure of communications can make all the difference between continued silence and swift compliance. By working with a specialist leasehold solicitor, managing agents can be confident that their correspondence carries the necessary legal weight, helping them quickly secure the information and funds required to effectively begin managing their new block. 

If you are encountering similar problems taking over a new block, or require general advice around the process involved in taking over a new development, please get in touch and our team will be happy to help. 

Get in touch with our experts

With hundreds of years’ worth of combined experience, our experts have dealt with nearly every leasehold property matter you can imagine. If you’re currently in need of legal support or advice, please get in touch.

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