The Supreme Court is due to hear an important appeal about the interpretation of RTM legislation

In the case of Avon Freeholds Ltd v. Cresta Court E RTM Company Limited [2025] EWCA Civ 1016, the Court of Appeal held that where an RTM Company failed to serve a notice inviting a leaseholder (Ms O'Connor) (whose lease was granted in 2020 but had not yet been registered at the Land Registry), to participate, the RTM Company could not acquire the right to manage. For more details on the Court of Appeal decision, please see our Insight: Registration gap issues and errors in statutory notices concerning property.

The RTM Company, Cresta Court E RTM Company, has appealed to the Supreme Court. The Supreme Court is due to hear the appeal on 7 July 2026. The question for the Supreme Court is whether the failure to serve Ms O’Connor with a notice of invitation to participate in the right to manage claim invalidated the Claim Notice served by the RTM Company to acquire the right to manage. This will be of interest to both landlords and tenants in relation to the process to acquire the right to manage but also is likely to be of wider significance in terms of the Supreme Court’s approach to errors in statutory processes concerning property.

The Court of Appeal had followed an earlier Supreme Court decision in A1 Properties (Sunderland) Limited v. Tudor Studios RTM Company Limited [2024] UKSC 28 about errors in statutory notices. If the Supreme Court considers that the RTM legislation contains a sanction for failing to comply with the requirement to serve a notice of invitation to participate, then following A1 Properties, it is likely to uphold the Court of Appeal’s decision that failure to serve Ms O’Connor invalidated the claim to acquire the right to manage. 

It is worth noting that where there is a sale of a flat from one tenant to another it is the legal owner (i.e. the person registered at the Land Registry at the time of service) which is the qualifying tenant in relation to a claim to acquire the right to manage for the purposes of the Commonhold and Leasehold Reform Act 2002. Here the issue was that there was no registered leaseholder at the time the notices of invitation to participate were served and so the RTM Company did not serve Ms O’Connor.

It will be interesting to see what the Supreme Court decides because it will provide clarity to landlords and tenants about whether failure to serve a person who is granted a new lease but has not yet been registered at the Land Registry invalidates a claim to acquire the right to manage. If the Supreme Court decides that there is no sanction in the RTM legislation for failure to serve the notice of invitation to participate on Ms O’Connor, they may provide some further guidance on how A1 Properties is to be applied to treat errors in statutory notices or failures to serve statutory notices under similar statutory processes, which may depend on the particular facts. Judgment will be reserved after the hearing on 7 July to be handed down at a later date.

Please contact Lauren Fraser, Laura Bushaway or your usual Charles Russell Speechlys contact if you have any queries.