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Does our RTM or residents’ company have to keep a register of members, and can it affect our Right to Manage?

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Yes. Every company must keep a register of its members, and failing to is an offence by the company and every officer in default. For an RTM company the stakes are higher: the Act counts members on the day the claim notice is given, and under the Companies Act a person becomes a member by agreeing to it and having their name entered in the register. A register that was never written up gives a freeholder an obvious argument that you never had enough members.

What the law requires

Section 113 of the Companies Act 2006 says every company must keep a register of its members. It must record each member’s details, the date they were registered as a member and the date they stopped being one. A company with share capital must also record the shares each member holds, and a company without share capital but with more than one class of member must record each member’s class. The register has to be kept available for inspection at the registered office, or at another place the company has told Companies House about (section 114).

If the company defaults without reasonable excuse, an offence is committed by the company and by every officer in default. The penalty on summary conviction is a fine up to level 3 on the standard scale, plus a daily fine for continued contravention.

Anyone can ask to see it

Under section 116 a member can inspect the register for free, and any other person can inspect it, or ask for a copy, on paying a fee. The request has to say who is asking and what the information will be used for, but it is not limited to members. A freeholder, or a solicitor acting for a buyer or for a leaseholder in a dispute with the directors, can all ask.

Why it matters more for an RTM company

  • The claim notice can only be given by an RTM company whose members, on the day the notice is given, include qualifying tenants of at least half of the flats in the building. With only two qualifying tenants, both must be members (section 79(4) and (5)).
  • The claim notice itself has to name every qualifying tenant who is a member and give details of their lease (section 80(3) and (4)).
  • Section 112(2) of the Companies Act says a person who agrees to become a member of a company “and whose name is entered in its register of members” is a member. Read together, the register is the company’s own evidence of who was a member on the day of the claim.

The Act is forgiving about mistakes in the paperwork. A claim notice isn’t invalidated by an inaccuracy in the particulars, and it isn’t invalidated because one of the people named turned out not to be a qualifying tenant, as long as enough genuine qualifying tenants (at least half the flats, and more than one) were members (section 81). It is not forgiving about having too few members. If the freeholder challenges the claim and the company can’t show who its members were, that is a weak position to be in.

To be clear about what we know: this is how the statutes fit together. We haven’t found a reported decision on what happens when a register was never written up, so we can’t tell you how a tribunal would rule. It is a risk you don’t need to run, because keeping the register is cheap.

Who is entitled to be a member

Under section 74 the people entitled to be members of an RTM company are the qualifying tenants of flats in the building and, from the date the company acquires the right to manage, the landlords under leases of the whole or any part of it. A term in a lease that excludes or modifies a tenant’s right to be a member of an RTM company, or penalises them for becoming one, is void (section 106).

Keeping it right

  • Write down each member’s name and address, the date they became a member and, when they leave, the date they stopped.
  • Update it whenever a flat is sold: the date the old owner stopped being a member and the date the new owner joined. Check your articles for how membership starts and ends.
  • Remember that Companies House doesn’t hold your register of members, so no one else keeps it for you. It is the company’s own record.
  • Print it or keep a dated copy each year, so you can show what it looked like at a particular time.

This is general information, not legal advice.

How Tiny Freeholder helps

Tiny Freeholder builds the register of members from the people you record: name, service address, the date each became a member and the date they ceased. You can print it as a dated page. Adding or removing a member goes through a resolution that the directors sign online, so each change has a record of who authorised it and when. It also reminds you when a member has no address or joining date recorded.

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