Legal challenges to NLA/NFRL merger dismissed by High Court

The National Landlords Association (NLA) is claiming a victory after the High Court dismissed legal challenges to the NLA/NFRL merger.

In July 2008, the NLA believed it had come to an agreement with the National Federation of Residential Landlords to form the largest landlord association in the UK.

But shortly after the merger was announced, 11 members of the former NFRL started legal proceedings against the NLA and NFRL directors who were in favour of the merger.

One of the opponents to the unification was Mike Stimpson, President, Chair of Council and a Board member of NFRL. He wrote to members stating that the move was not a merger as the NLA had simply acquired NFRL and all its goodwill, records, files and staff.

He said: “What valuation (if any) did they obtain for these assets? What price was paid by NLA for them? Why was there no vote of members on the terms? In my opinion the NFRL has been given away.”

On Thursday 21 May, His Honour Judge Pelling QC dismissed the legal challenges to the merger and ordered those who brought the action to pay the NLA’s costs.

The High Court had previously ordered a ballot of NFRL members asking them if they were in favour of the merger. The result came out in favour of the move.

David Salusbury, Chairman, NLA, said: “It is a relief that this episode is now over. The NLA remains wholeheartedly committed to the concept of a unified voice for landlords and we never believed that costly litigation would be in the best interests of members or of the private-rented sector.

“If there are members of the former NFRL who were waiting for the outcome of the legal challenges before deciding what to do, we now look forward to welcoming them on board and helping to support them in their lettings business.

“It is now time to focus all of our energies on the serious matters facing all landlords, not least Government proposals to introduce a national register of landlords.”