Section 116 duties

Section 116 , also known as the right to inspect, provides individuals with the ability to request the name and address of members within a company. Included within the Companies Act 2006, this legislation is of relevance to any companies within leasehold industry, such as management companies, some freeholders and any other companies.

Section 116 of the Companies Act enables someone to request the name and addresses of members within a company. Also known as a right to inspect, this is commonly done when a leaseholder wants to contact other leaseholders to see whether there is an appetite to change the management of their block.

For a request to be categorised as a right to inspect it must include certain information:

  • The name and address of the individual making the request (if made by an individual).
  • If made by a company, it must contain the name and address of the individual responsible for making the request.
  • The purpose for which the information requested will be used.
  • Whether the information will be disclosed to any other person, including details of that person and how they will use the information.

It is crucial to note that a request doesn’t have to identify itself as a right to inspect or a request in relation to section 116 of the Companies Act 2006. Therefore any communication containing the information listed above is subject to section 116.

What to do if you receive a request?

It’s vital to act quickly should you receive a request, as you only have 5 working days to decide how you want to proceed. Ultimately the decision will come down to whether you want to comply with the request or apply to court for an order that the information requested does not need to be disclosed, as the request didn’t provide a proper purpose for doing so.

Failure to respond or disclose the register of members where there is a proper purpose is a criminal offence, that is committed by the company and every officer of that company. It is therefore crucial to recognise the request when received and act quickly.

If you would like legal advice and support with a Right to Inspect request, please get in touch and one of Bradys’ experts will be happy to assist.

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