Residents Management Company - Termstake
Termstake
One of the main lease conditions is that all leaseholders must contribute to and cover the costs of maintaining the ongoing operation of the property (building and surrounding land within the boundary). Examples of operational costs include, but are not exclusively, cleaning, lighting, heating, gardening, legal, accounting, security/entryphones, tree surgery and small repairs & replacements. In many of these cases third party companies are engaged to take on these tasks. To facilitate the handling of this, it is a legal requirement to establish a residents’ management company - technically an owners’ management company - through which all these activities are coordinated.
For Augustus Court, this company is called Termstake Residents Management Limited (Termstake) and it was set up at the time that the original 15 leases were put up for sale in 1987. Ownership of Termstake is determined by the issue of 15 shares, each share being associated with one specific flat, i.e. with one specific lease. The registered owners of these shares (the leaseholders) are financially liable for the fees and charges payable to Termstake for the operational costs of the company.
Directors are appointed (a) to ensure that Termstake fulfils its obligations of maintaining the effective operation of the property within the financial resources available to it, and (b) to make sure all owners comply with the covenants defined in their leases. The Directors are drawn from the 15 principal leaseholders. Termstake’s AGM is usually held in the November/December following the financial year end in March. All operational costs are identified and summarised in the annual set of accounts published to all owners registered with Termstake.
Managing Agent
Whereas some management companies are run directly by some of their members under the direction of their Directors, the vast majority of them like Termstake appoint a third party to manage the day to day running of the company on behalf of the owners. This third party is known as the Managing Agent - for Termstake this is Killochan & Co of Richmond, a small family firm which has held this role since Termstake was established and which also manages similar properties elsewhere in the UK.
The fees charged by the managing agent cover the costs of operating Termstake, including all its financial transactions, the filing of accounts and other associated paperwork with Companies House, liasing with the appointed accountants and solicitors, paying suppliers and collecting the service charges and other fees payable by the leaseholders. The agent’s fees are included in the operational costs of running Augustus Court. The two Directors meet regularly with the agent to ensure the continued operation of Termstake and to authorise the agent to proceed with certain activities as required. They also work together to manage the operating budget and to agree the required owner contributions.