Leasehold and Freehold Reform Act 2024 Update: Right to Manage Claims

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Lease Law
by Dara Antova

The following sections of the Leasehold and Freehold Reform Act 2024 will come into force on 3rd March 2025 which affect right to manage claims:

  • Section 49: Increases the non-residential limit on Right to Manage (RTM) claims.
  • Section 50: Addresses the costs associated with RTM claims.
  • Section 51: Strengthens compliance with obligations under the Commonhold and Leasehold Reform Act 2002.
  • Section 52: Prevents first-instance applications to the High Court in tribunal matters.
  • Section 64: Introduces restrictions on the recovery of non-litigation costs under the Landlord and Tenant Act 1985.

Increase of non-residential limit on RTM claims

One of the most significant changes is the increase in the non-residential threshold for Right to Manage claims from 25% to 50%, allowing more leaseholders in mixed-use buildings to take control of their property management.

Costs and Jurisdiction in connection with RTM Claims

The new costs regime will generally make each party liable for their own costs in connection with an RTM claim save for in limited circumstances such as where there is a costs order made by a court or Tribunal.

The jurisdiction for determining disputes in connection with the RTM will be given to the First Tier Tribunal rather than the county court.

Updates to RTM Companies

On 6th February 2025, the government introduced amendments to the prescribed articles that RTM companies must use. These changes, which will come into force on 3rd March 2025, clarify voting rights and ensure that landlords under leases have capped voting power.

Key Amendments:

  1. The definition of “lease” has been updated to align with the Commonhold and Leasehold Reform Act 2002.
  2. Freeholders and landlords who are members of RTM companies will be entitled to one vote.
  3. Landlord votes will be capped at one-third of the total votes exercisable by qualifying tenants.

How we can assist

If you would like to discuss a proposed right to manage claim and/or would like to obtain a quote for our fees, please do not hesitate to contact us on 0204 511 0900 or info@leaselaw.co.uk.

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