Section 4B: RTE companies: membership, Leasehold Reform, Housing and Urban Development Act 1993

Before the execution of a relevant conveyance to a company which is a RTE company in relation to any premises the following persons are entitled to be members of the company—

qualifying tenants of flats contained in the premises, and

if the company is also a RTM company which has acquired the right to manage the premises, landlords under leases of the whole or any part of the premises.

In this section—

"relevant conveyance" means a conveyance of the freehold of the premises or of any premises containing or contained in the premises; and
"RTM company" has the same meaning as in Chapter 1 of Part 2 of the Commonhold and Leasehold Reform Act 2002.

On the execution of a relevant conveyance to the RTE company, any member of the company who is not a participating member ceases to be a member.

In this Chapter "participating member", in relation to a RTE company, means a person who is a member by virtue of subsection (1)(a) of this section and who—

has given a participation notice to the company before the date when the company gives a notice under section 13 or during the participation period, or

is a participating member by virtue of either of the following two subsections.

A member who is the assignee of a lease by virtue of which a participating member was a qualifying tenant of his flat is a participating member if he has given a participation notice to the company within the period beginning with the date of the assignment and ending 28 days later (or, if earlier, on the execution of a relevant conveyance to the company).

And if the personal representatives of a participating member are a member, they are a participating member if they have given a participation notice to the company at any time (before the execution of a relevant conveyance to the company).

In this section "participation notice", in relation to a member of the company, means a notice stating that he wishes to be a participating member.

For the purposes of this section a participation notice given to the company during the period—

beginning with the date when the company gives a notice under section 13, and

ending immediately before a binding contract is entered into in pursuance of the notice under section 13,

is of no effect unless a copy of the participation notice has been given during that period to the person who (in accordance with section 9) is the reversioner in respect of the premises.

For the purposes of this section "the participation period" is the period beginning with the date when the company gives a notice under section 13 and ending—

six months, or such other time as the Secretary of State may by order specify, after that date, or

immediately before a binding contract is entered into in pursuance of the notice under section 13,

whichever is the earlier.

In this section references to assignment include an assent by personal representatives, and assignment by operation of law where the assignment is to a trustee in bankruptcy or to a mortgagee under section 89(2) of the Law of Property Act 1925 (c. 20)(foreclosure of leasehold mortgage); and references to an assignee shall be construed accordingly.

Section 4B: RTE companies: membership

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