Pauline’s Problem Page – what to do if your Property Management Company fails

It would seem that developers all over the world are skilled in the art of ‘scamming’. Here is a letter I found in The Mail on Sunday and the reply:


“When we moved into our home in a development of 16 houses in 2007, the sales contract included a provision that all homeowners become members of a management company set up to look after our common areas. This company wasn’t set up properly. The developer is listed as the sole director but we have now found out that it has run up debts in the company’s name. In the meantime no maintenance is being done”.


“Your solicitor ought to have ensured that the company was properly set up and you must insist he helps you now, at no extra fee. If you and your neighbours were never made shareholders or directors, you shouldn’t have any responsibility for its debts. You may be bound to make payments towards maintenance of the common areas but if the company was not properly set up, then these areas could be owned by the developer. If the management company has debts that it cannot pay, it is likely to end up in the hands of receivers. If it does own the common areas, you and your neighbours could buy them from the receivers”.

Now what we all wouldn’t give for our problems to be so easily solvable?

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