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In order to justify these management charges MHML had previously held itself out on its Mitre House website (http://www.mitrehouse.com/mitre-house-management-limited.html ) as having relevant property management experience. MHML asserted, amongst many other claims, that MHML is “the most used RTM service provider”, “forms over 85% of all RTM companies” and had experience of handling collective freehold enfranchisement applications. They further stated that MHML carried £3 million of professional indemnity cover. In fact these representations were all completely untrue and had simply been plagiarized in totality from the website of Canonbury Management – a bona fide property management company. MHML had also downloaded all of Canonbury’s terms and conditions of business on to its own website. MHML had simply changed the corporate name, wherever it appeared, from Canonbury to MHML.
As soon as this flagrant abuse was drawn to their attention, Canonbury objected to this breach of their copyright and forced MHML to withdraw and take down from the MHML website all the false misrepresentations as well as the plagiarized terms and conditions. However the leaseholders/tenants have retained copies of the previous website text for evidential purposes – see Item 1 of the Second Schedule.
Reply: A very petty observation which our apology to Canonbury was gentlemanly accepted as correspondence well evidences.
2. The RTM application and fraudulent conversion of Mrs Hillgarth’s dividends
Although Mrs Hillgarth was initially a director of MHML, the company was not under her control and Mrs Hillgarth became concerned at the way things were turning out. Thus in June 2013, while she was still a director of MHML, a majority of the leaseholders (including Mrs Hillgarth) tried to orchestrate a “Right to Manage” application in relation to Mitre House. However the application failed because the property was “non-qualifying” in terms of the relevant legislation (ie there was too much commercial space in relation to the residential space).
On 18 September 2014, in the course of the refurbishment project described below, Mr Brown- Constable and his co-directors removed Mrs Hillgarth as a director of MHML. Having done so, Mr Brown-Constable initially sought to impose, through MHML, charges amounting to £2,582.74 for the time spent by himself and other directors in dealing with this “Right to Manage” application. Their invoice was initially submitted to a company called Mitre House RTM Company Limited (this being a special purpose company, set up by Mrs Hillgarth and the other applicants, to pursue the RTM application). However the RTM company had not agreed to pay those charges, and did not do so.
Mrs Hillgarth had also not agreed to pay those charges. Nor did she have any legal obligation to do so. On 6 October 2014 Mr Brown-Constable sent to Mrs Hillgarth a cheque for £67.26, having offset, against an MHML dividend of £2,650 properly payable to her, the sum of £2,582.74 in respect of the MHML charge to the RTM Company. For MHML’s convenience, Mr Brown-Constable had simply chosen to offset this arbitrary sum against a dividend which should have been payable to Mrs Hillgarth by MHML. Effectively Mr Brown-Constable simply wrote himself a cheque with Mrs Hillgarth’s money without her permission. He was in a position of trust as regards that money and abused his position as a director to get his way.
Mrs Hillgarth did not cash the cheque for £67.26 which Mr Brown-Constable sent her. That would have been to accept an unlawful offset, which she was not prepared to do.