LAFRA 2024 – Key RTM reforms commence on 3rd March
Matthew Pennycook, the Minister of State for Housing Communities and Local Government, yesterday passed The Leasehold and Freehold Reform Act 2024 (Commencement No. 3) Regulations 2025.
This secondary legislation brings into force parts of LAFRA 2024 which fundamentally change the Right to Manage regime. The reforms are in force from 3 March 2025 and, in summary, are:
| Provision | Position under existing legislation | Position from 3 March | |
| s.49 | % non-residential limit on RTM claims | A premises will not qualify for RTM where the internal floor area of any non-residential area exceeds 25% | A premises will not qualify for RTM where the internal floor area of any non-residential area exceeds 50% |
| s.50 | Costs of RTM | The RTM Co is liable for the ‘reasonable costs’ of the landlord (including the cost of any proceedings if the RTM Co’s application is unsuccessful) |
The RTM Co is not liable for the landlord’s costs.
The only exception is where the Tribunal awards costs (only available if the claim is withdrawn or ceases to qualify, and other conditions are satisfied). |
| s.64 | Restriction on recovery of non-litigation costs | A landlord can charge costs incurred in relation to the RTM claim to the service charge if the lease permits it (subject to s19 of the Landlord and Tenant Act 1985). | The landlord cannot charge leaseholders who are not members of the RTM Co the non-litigation costs incurred in relation the RTM claim via the service charge. |
| s.51 | Enforcement procedure | A landlord or the RTM Co can apply to the County Court for an order to require any person to make good a default under the Commonhold and Leasehold Reform Act 2002 after 14 days has passed from the service of a default notice. |
The Tribunal is now the correct forum to bring a default action.
If an order other than an order to pay a sum of money is made, the action can be transferred to the County Court for enforcement. |
| s.52 | First instance applications to the High Court | N/A | Where the FTT has jurisdiction, it is not possible to apply to the High Court for a determination in the first instance. |
| RTM Model Articles | The RTM Model Articles are contained in the Schedule to The RTM Companies (Model Articles) (England) Regulations 2009 |
The RTM Model Articles have been amended by The RTM Companies (Model Articles) (England) (Amendment) Regulations 2025. The main amendment is to place a cap on the total number of votes that can be exercised by member landlords.
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The timing of these reforms is interesting. The proposed timetable for the implementation of LAFRA (issued by Matthew Pennycook in November 2024) suggested that the RTM amendments would come into force in the Spring of 2025. They have, then, arrived at least a month early, and just 10 days after the High Court gave permission for several high-profile judicial review challenges to LAFRA to proceed to a full hearing. One wonders if the Government are seeking to bring through as many of the less controversial aspects of LAFRA before the hearing in July.
See the links to our previous posts about the judicial review permission hearing and the timetable for LAFRA, together with The Leasehold and Freehold Reform Act (Commencement No. 3) Regulations and The RTM Companies (Model Articles) (England) (Amendment) Regulations 2025.
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