RTM Companies: Decision-Making by Members

Are you a member or a director of a Right to Manage company?

If so, then you should make yourself familiar with the requirements regarding decision-making under the RTM Companies (Model Articles) (England) Regulations 2009.

In this article, we will take a closer look at the effect that the regulations have on the decision-making process of the members and directors of RTM companies at general meetings.

What are the RTM Companies (Model Articles) (England) Regulations 2009?

These regulations govern many aspects of RTM companies, including how such companies hold general meetings and make decisions.

Where there is an RTM company, leaseholders have exercised the right to manage in order to exert greater control over the management decisions regarding their building. It is important that these decisions are made in accordance with the relevant regulations.

How do the Regulations Affect Decision-Making?

Attendance and Speaking at General Meetings

For a general meeting to take place, at least 20% of the members of the RTM company or 2 members of the company (whichever is greater) must be present. Members can appoint a proxy to attend the meeting in their place, however, they must serve a proxy notice in advance of the general meeting.

If a sufficient number of members are not present at the meeting, it will be adjourned for another date.

All members have the right to attend and voice their opinions at general meetings. Members can then vote on resolutions raised at the general meeting.

Appointment and Role of the Chairperson

If a chairperson has been appointed, they will chair the general meeting so long as they are in attendance and willing to do so.

If no chairperson has been appointed, or if the chairperson is unwilling to or not present to chair the meeting, the directors will appoint a member to act as chair for that general meeting.

The chairperson can also permit anyone who is not a member of the RTM company to attend and speak at the general meeting.

Voting

Resolutions raised at general meetings will be decided by a show of hands. This means that the members each have one vote and they will raise their hand to vote in favour of or against the resolution.

Under certain circumstances, a poll vote may be demanded. The grounds for demanding a poll vote will be set out in the company’s articles of association. Poll votes give each member one vote per share.

Amending Resolutions

Ordinary resolutions may be amended by a further ordinary resolution.

Special resolutions can be amended by ordinary resolutions where the chairperson proposes the amendment. If the chairperson decides, acting in good faith, that the amendment is not appropriate the ordinary resolution will not be held to amend it.

Conclusion

The RTM Companies (Model Articles) (England) Regulations 2009 provides the rules and regulations which members and directors of RTM companies must follow when conducting general meetings. The regulations cover a wide range of subjects. This article has focused on decision-making at general meetings by members and directors of RTM companies.