Tribunal-appointed Manager

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Appointment of an Independent Manager

Management of Canary Riverside 

Canary Riverside is under the independent management of Mr Sol Unsdorfer, who was appointed by the First Tier Tribunal (Property Chamber). The Tribunal’s decision detailing the reasons why it removed management of Canary Riverside from the Landlord in 2016 can be found here.

Mr Unsdorfer is the managing director of Parkgate Aspen, the company that provides the day-to-day management of the Canary Riverside estate. The Tribunal’s Decision appointing him can be found here and the Management Order (setting out the legal basis of Mr Unsdorfer’s appointment and the scope of his responsibilities) can be found here.

Mr Unsdorfer commenced management responsibilities on 1st October 2019. Leaseholders have applied to extend Mr Unsdorfer’s appointment. Mr Unsdorfer will continue to manage Canary Riverside until the FTT has determined the outcome of that application. We do not yet know when the hearing will take place.

The Management Order and the supplementary Order set out Mr Unsdorfer’s management responsibilities.

A Section 24 manager takes over the landlord's right to manage the building.  The manager is independent of the landlord and leaseholders, and is accountable solely to the FTT.  His/her role is to act in the best interests of the estate as a whole and manage the estate in accordance with the leases, legislation and the RICS Code. 

A S24 manager’s role is sometimes wrongly compared/confused with that of a managing agent. The S24 manager is court-appointed official, similar to the role carried out by a court-appointed receiver. A managing agent is the company contracted to provide day-to-day management services, reporting to the S24 manager/landlord/Right to Manage company etc.

You can find information on the original Tribunal applications relating to the appointment of a Manager and updates regarding subsequent Tribunal applications regarding the Management Order here. A copy of Mr Coates’ (the S24 manager between 1st October 2016 - 30th September 2019) final report to the FTT can be found here.

Why did the Tribunal appoint a Manager to replace the Landlord?

The decision by the court to appoint a manager to take over the responsibilities of a landlord is not taken lightly, and happens because of serious failings in the management of an estate.  At Canary Riverside the Tribunal found that CREM had failed to adequately manage the estate or recognise any failings in their management, including:

Poor financial management:

  • leaseholders had suffered from poor management of their properties for several years, with a lack of accounting and transparency in the management and finances in particular. Five years’ service charge accounts were outstanding, and lessees had never been given the full accounts or details of their reserves.

  • CREM did not give leaseholders access to the accounting records, despite this being required by law. The records that were eventually provided (once the legal action commenced) were incomplete and/or so heavily redacted as to be meaningless.

  • CREM appeared to have used service charge monies belonging to the leaseholders.

  • the residential reserves had been included in CREM’s own accounts as cash at bank, with no indication whatsoever that the monies belonged to the leaseholders’. It was only once the legal action commenced the CREM notified the bank that the monies were actually being held on trust.

  • the tribunal acknowledged that, had it not been for the leaseholders' application, CREM would not have addressed the issues raised by the leaseholders - including producing five years' outstanding accounts.

  • CREM failed to credit leaseholders in a timely manner with past year’s underspends.

Poor estate management:

  • major maintenance issues were only dealt with after the leaseholders commenced their legal action. This included replacing the crumbling garden path and repairing leaking windows.

  • the managing agent, Marathon Estates (a landlord company) did not have sufficient staff or experience to manage the estate.

  • unreasonable service charges in excess of £400,000 had been spent on repairs to chiller plant that was at the end of its useful life.

  • a planned preventative maintenance plan was not implemented nor taken into consideration when setting budgets.

The Tribunal added that other allegations were made by the leaseholders, but that the breaches already detailed in its decision were sufficient grounds, and it did not need to detail any further breaches. The brevity of the FTT’s decision is unfortunate, as it is the only official record of the five-day hearing.