The Right to Manage (RTM) was introduced as a workable, no-fault right designed to empower leaseholders. It gave flat owners a legal right to take over the management of their building (and importantly the service charge and insurance) without having to prove landlord mismanagement, and without needing the landlord’s consent or parting with cash for the freehold under the collective enfranchisement process.
The policy intention was simple: put leaseholders in control of how their homes are run.
But the latest Court of Appeal decision on the validity of RTM claim notices is, in my view, a step backwards towards the wild west days of landlord’s solicitors finding any technical argument possible to deny the intention of the RTM legislation.
It risks emboldening freeholders to challenge claims on highly technical grounds in which there is no prejudice to anyone, creating uncertainty where the law was meant to be clear. Instead of a practical, empowering right, RTM risks becoming mired in procedural traps that freeholders can exploit. It risks making the RTM so high risk as to be unworkable.
The latest case
The Court of Appeal considered two issues that go to the heart of the RTM claim process in Avon Freeholds Ltd v Cresta Court E RTM Company Limited [2025]:
Qualifying Tenant Status - The court agreed with the Upper Tribunal that a tenant holding an equitable lease (because their lease had not yet been registered at the Land Registry) was nonetheless a “qualifying tenant” under section 75 of the CLRA 2002. This was a sensible outcome. To hold otherwise would create an absurd situation where a tenant qualified between exchange and completion but not after completion, during the registration gap. The Court of Appeal rightly recognised that equitable leases should fall within the statutory definition of a “long lease.”
Notice of Invitation to Participate (NIP) - This is where the real blow to leaseholders comes. The Upper Tribunal had been prepared to take a more pragmatic view, but the Court of Appeal reversed that decision. It held that failing to serve a qualifying tenant with an NIP invalidates the entire claim notice. In doing so, the court leaned heavily on the Supreme Court’s reasoning in A1 Properties (Sunderland) Ltd v Tudor Studios RTM Co Ltd [2024] UKSC 27, emphasising that section 79(2) of the CLRA 2002 makes it explicit: if every qualifying tenant is not served with an NIP, the claim notice fails.
Why the RTM process is now riskier
At first glance, this may look like an academic argument, but its implications are significant for the millions of leaseholders in England and Wales. Serving NIPs is an administrative step, and RTM companies, often groups of ordinary leaseholders volunteering their time, can easily make mistakes or use out of date information. Leases can be in the process of registration, ownership details may not be fully up to date, and the register is not always totally clear.
This decision gives freeholders a way to try and defeat these claims, even though no prejudice has been suffered in reality. A single missed notice, even where the tenant in question has no objection or is in full support of the claim, can now derail the entire RTM process, due to the overly technical application of the rules by the Courts. It raises the stakes dramatically for leaseholders and their advisers, shifting power back to freeholders who are well-resourced and often motivated to resist RTM claims.
A backwards step for flat owners
RTM was intended to be a practical, accessible right. Leaseholders were meant to be able to use it without becoming entangled in costly disputes or hyper-technical legal challenges. The Court of Appeal’s decision undermines that intention. Instead of focusing on whether leaseholders have the support and organisation to manage their building, the emphasis is on rigid compliance with procedure.
From my perspective as a solicitor working daily with leaseholders, residents’ management companies, and right to manage companies, this ruling feels like a backwards step. It is out of touch with the policy goal of empowering flat owners and will, I fear, embolden freeholders to raise technical arguments wherever they can. In practice, it risks more RTM claims failing on procedural grounds rather than on the merits.
How can we ensure a valid RTM Claim notice is served?
For leaseholders, the message is clear: the RTM process must be handled with absolute precision. Every qualifying tenant must be identified, including those holding equitable leases during registration gaps, and each must be served with an NIP. There is no room for error.
For practitioners like me, this means an even greater responsibility to ensure claims are watertight from the outset. It also means higher costs for leaseholders, as the process becomes more legally complex and requires closer scrutiny. That is not what Parliament intended when it created the right to manage.
If you are looking at starting off an RTM claim, I would be please to assist and set out Peppercorn Law's RTM claim service here.
A victory for freeholders, plain and simple
The Court of Appeal’s decision will be welcomed by freeholders, who now have another avenue to challenge RTM claims. But for leaseholders, it represents another hurdle in a process that was supposed to be straightforward. It will also mean that other, similar technical arguments may be put forward by freeholders who are desperate to hold on to power.
As founder of Peppercorn Law, I remain committed to helping leaseholders and RTM companies navigate these challenges. But I cannot help but feel disappointed. Rather than reinforcing RTM as a user-friendly right, this ruling undermines its accessibility and risks deterring leaseholders from exercising it at all.
RTM was meant to level the playing field. This judgment tips the balance back towards freeholders, and that is not progress.