Like, say if Judges wanted to go official on a LN ID, admins would just go "hell no" and that would be the end of it. I think you are mistaken if you think the system is intended to be fair - I think it is intended to drive the server forward, regardless of zombie factions hugging the faction slot.
It could be very good for the server and create some healthy competition between factions on the same ID if people can go about things maturely, factions would have to stay on their toes and always shine because if they don't somebody will just outshine them. Freezing people and groups out won't work as well either if the sole slot isn't yours to keep for ever and ever.
A proper incentive to act and play in a positive way, and also an incentive for other players to form factions and groups and focus on the RP because there'd be an end-goal and a possible reward by doing your own thing and following through, rather than just having oorp nit-picking arguments with the current slot holders and never having "proper" end goals for your faction.