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Lord McIntosh of Haringey: My Lords, this amendment is an old favourite as well. I thought that we had reached a reasonable degree of agreement about this matter. As I explained in Committee, we agree with the thrust behind the amendment but we do not agree with its form. We see merit in ensuring that those who are invited to take on the right to manage are properly made aware of what that will involve. We intend to look carefully at how that might be done in regulations, using the power granted under Clause 76(3) of the Bill. I can give the noble Lord the firmest of assurances that we will do that.

However, we do not want to write a provision on to the face of the Bill. We certainly do not want to do so in terms of this amendment. As we have said previously, with all due respect to the Royal Institution of Chartered Surveyors, its code of practice is a red herring for these purposes. The management responsibilities of an RTM company do not derive from that or from any other approved code of practice, but rather from this Bill and from the leases of the property.

The approved codes of practice will, of course, have an important role to play. The RTM company will be expected to follow the provisions of the code, and failure to do so will be one of the grounds on which it will be possible to seek the replacement of a company under Part II of the Landlord and Tenant Act 1987. In that respect, the RTM company will be no different to landlords who govern outside the Bill.

Given that role, we see no objection to the invitation to participate drawing attention to the general expectation that the RTM company should follow the relevant code. However, we see no advantage in repeating individual provisions of the code in the

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invitation; nor do we find the concept of "relevant provisions" helpful. Surely the RTM company, and indeed any manager, should comply with the code as a whole, in which case all the provisions would be relevant and the whole code would need reproducing.

We continue to agree with the noble Lord, Lord Kingsland, that the invitation to participate has a role to play in highlighting what it will mean to acquire the right to manage. But we do not wish to tie ourselves to a form of words at this stage. We prefer to seek views on what the correct form of words might be—in both content and clarity—as part of the wider consultation to which we have committed ourselves on RTM regulations. We then intend to use our regulation-making powers to put an appropriate requirement in place.

The noble Lord, Lord Kingsland, referred to his amendment at Committee stage. That was then Amendment No. 122, which proposed that a failure to serve notice of invitation should not in itself invalidate a claim notice. It is for that reason, as the noble Lord recognised, that we have brought forward Amendment No. 35. I hope that the noble Lord will not seek to press his amendment.

Lord Kingsland: My Lords, I shall not seek to press the amendment. I beg leave to withdraw it.

Amendment, by leave, withdrawn.

Lord McIntosh of Haringey moved Amendment No. 35:


    Page 37, line 16, at end insert—


"( ) A notice of invitation to participate is not invalidated by any inaccuracy in any of the particulars required by or by virtue of this section."

The noble Lord said: My Lords, this is the amendment to which I have just referred, which was inspired by the noble Lord, Lord Kingsland. I am glad to have the noble Lord's attention.

The House will recall that the noble Lord's Amendment No. 122 in Committee proposed that a failure to serve notice of invitation to participate correctly should not in itself invalidate a claim notice, provided that enough people were members of the RTM company at the time the claim notice was served to make that notice valid. As I said in Committee, we think that this is an excellent idea. That is why we have brought forward Amendment No. 35.

The amendment provides that a notice of invitation to participate in the right to manage is not invalidated by any inaccuracy in the information that must be included in that notice. Clause 80(1) makes similar provision for the RTM claim notice. It will mean that a claim notice cannot be thrown out because the company has made an error in its earlier invitation to participate.

I should have said at the beginning that I shall speak also to Amendment No. 67, which makes the same provision for the invitation to participate for collective enfranchisement.

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We are grateful to the noble Lord, Lord Kingsland, for inspiring the amendments. He will no doubt want to know what happened to the original Amendment No. 122. When we sat down to prepare our own amendment, it became apparent that what we were seeking to do could have an unfortunate side-effect if taken by itself. Let us assume that an RTM company is established which, from the outset, has sufficient qualifying tenants as members to be able to serve a valid claim notice. If a claim notice was not invalidated by a failure properly to serve the invitation to participate, such a company could not be penalised for making its claim without serving any invitations to participate. I am sure that the noble Lord agrees that that would be undesirable.

We have already discussed in Committee the role of the invitation in alerting leaseholders to what the acquisition of the right to manage will entail. We have undertaken to make appropriate use of our powers to prescribe the further contents of the invitation to participate to address that. In the light of that, it is essential that we do not open up a loophole that could allow an RTM company to get away with serving no invitations. I beg to move.

Baroness Hamwee: My Lords, I wanted the noble Lord, Lord Kingsland, to have his moment of glory before I rather churlishly intervened with a question, but he has urged me to ask my question. I appreciate that the same point arises on Clauses 79 and 80, to which the Minister has just drawn our attention.

I do not oppose the provision, which is a fairly standard one, but its extent is not entirely clear to me. Will the Minister confirm that a misleading inaccuracy would not be covered by the provision? I have in mind inaccuracies in such details as the address of the premises or, in the later clauses, an estimate of the price that is referred to among the particulars. If those details are wildly wrong, would that so go to the heart of the issue as to invalidate the notice of invitation to participate?

I am also unclear about whether Clause 76(5) falls within the provision, or whether it just extends to Clause 76(2). I apologise for not having given notice of those questions.

Lord Williams of Elvel: My Lords, in spite of the inspiration of the noble Lord, Lord Kingsland, I join the noble Baroness, Lady Hamwee, in having some questions about the amendment. The noble Baroness has cited some ways in which the notice of invitation to participate might be misleading, to which I might add errors in specifying the place at which the articles of association may be inspected so that no one could get to see them. If the notice was wholly inaccurate in many respects, surely it could not be a proper notice of participation.

Lord Kingsland: My Lords, I am much obliged to the Minister for his magnanimous comments about my contribution to the draft that the Government have

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decided to include in the Bill. I hope that that concession will characterise the second half of our proceedings.

5.45 p.m.

Baroness Gardner of Parkes: My Lords, I think that it is in order for me to ask a question. Does Amendment No. 67 cover a different issue? It seems to come in the section about leasehold collective enfranchisement rather than the right to manage. Am I correct in thinking that? If so, I should like to comment on Amendment No. 67.

Lord McIntosh of Haringey: Yes.

Baroness Gardner of Parkes: My Lords, in that case I have a question. If someone wishes to enfranchise collectively—not even in the case of a single house—is there no obligation on the person from whom they are enfranchising to tell them whether the properties are under a management scheme or any type of restrictive covenant? What information on their future obligations is provided to people who are about to enfranchise a house or a flat collectively?

I ask that because the point has been raised by people who tell me that only after going through the whole enfranchisement procedure and receiving their freehold documents have they been given a list of restrictions to be imposed on them. That seems unfair. Someone who is to be subject to a special management scheme, particularly from the former freeholders of the property, should be told in advance. That might relate to Amendment No. 67 and we could discuss it again when we reach that amendment.

Lord McIntosh of Haringey: My Lords, I shall respond to the noble Baroness, Lady Hamwee, the noble Lord, Lord Williams of Elvel, and the noble Baroness, Lady Gardner. The first point raised by the noble Baroness, Lady Hamwee, was about misleading information. I am advised by my noble and learned friend Lord Falconer that fraud unravels all. In other words, if the information is deliberately misleading, it cannot stand under any circumstances. The question then arises as to whether it is inadvertently misleading. Clearly, to some extent any wrong information under the clause could be inadvertently misleading. The question is whether it is sufficiently misleading as to cause difficulty.

The amendment is restricted to the items in the notice that are included in Clause 76, but that includes the items in subsection (5). The amendment refers to "this section". There must be a point at which an inaccuracy becomes so misleading as to invalidate the notice, but similar phraseology has been used in legislation on many occasions and I have no doubt that in the end the courts will resolve whether an inaccuracy is misleading enough, inadvertently, to cause damage to the notice. I shall write to noble Lords about that before the next stage and to the noble Baroness, Lady Gardner, who has raised an interesting point about Clause 120.

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On Question, amendment agreed to.

Clause 77 [Right to obtain information]:


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