Article contributed by Ian Quayle

2-4 Leigham Court Road LON/ooAY/HYI/2022/0005 & 0016

As identified by Rob Bowker and Pauline Lam concerning the above case, I thought it important to look at the case from the perspective of the residential conveyancer.  

What are the takeaway points for transactional property lawyers?  

1. Did the BSA (Building Safety Act) 2022 apply? 

The matter came before the First Tier Tribunal after an application for a remediation order was made by the leaseholders. The Respondent was the current landlord. 

The parties agreed and the tribunal held that both blocks in development were relevant buildings as defined under section 117 (2) BSA 2022. The reason for this is that both were buildings over 11 metres tall and were self-contained and each comprised 6 stories and more than two dwellings. 

The First Respondent was a relevant Landlord as defined by section 120 (5) BSA 2022. The Second Respondent was associated with the developer within the meaning of section 121 BSA 2022. 

The applicant leaseholders held qualifying leases as defined by section 119 (2) BSA 2022 and all were interested persons for the purpose of making an application for a mediation order within the meaning of section 123 (five) of the act. 

The parties had agreed that there were defects of the building which were relevant defects as defined by section 120 (2) BSA 2022 as they caused a building safety risk within the definition of section 120 (5) BSA 2022 and required remediation. The defects included ACM (Aluminium Composite Material) cladding, the lack of fire stops, cavity barriers and compartmentation, fire cement external wall systems, panel insulation and lack of cavity barriers. 

1. How did the FTT apply the relevant sections of the BSA 2022 in considering whether a remediation order should be made?  

The tribunal found the conditions for making a remediation order against the respondent had been met. In doing so it provided some useful guidance on the interpretation of the relevant sections of the BSA 022. 116 2125 of part five of the Building Safety Act 2022 relates to the remediation of certain defects.  

The tribunal held that Sections 116 to 125 BSA 2002 constituted a self-contained code containing definitions and a statutory test for the making of a remediation order in section 123. The explanatory notes to the BSA stated the relevant sections of the BSA 2022 are a one-off intervention designed to deal with the current serious problems with historical building safety defects in medium and high-rise buildings. The statutory definitions are intended to be clear, simple, and straightforward. 

The tribunal usefully stated that Section 123 BSA 2022 is drafted broadly and provides wide powers to the tribunal. The tribunal stated that it was not necessary to restrict its interpretation of Section 123 by reference to other statutory provisions or previous case law. 

The tribunal approached its task logically by way of the following: 

1. Determining that there were indeed relevant defects with reference to Section 120. Relevant works for the purposes of a relevant defect included works relating to the construction or conversion of the building completed within the relevant period of 30 years. 
2. The tribunal determined that a building safety risk was defined by Section 120 (5) of the BSA 2022.  
3. The tribunal held that once it was satisfied that there was a relevant defect in the building, it had the power to make a remediation order. The date for consideration as to whether a relevant defect arose and whether it created a building safety risk is the date of the hearing. The tribunal was to consider the risk that is caused by the state of the building at the date of hearing using the current knowledge of building materials and processes. In other words, whether the work creates a building safety risk in the light of today’s knowledge. The tribunal had been referred to improvement notices issued under the Housing Act 2004. The tribunal held that improvement notices were not relevant to the current proceedings as the test used was different to the statutory test for making of a remediation order under the BSA 2022. 
4. The tribunal held there was no guidance provided within the BSA 2022 as to how the risk to the safety of people in or about the building or the scope of the works required to remedy the relevant defects or the standard to which any remedial works must be carried out or not. Once again, the BSA 2022 was described as being deliberately in broad terms to enable the tribunal to find the best and most practical outcomes focused solution. In that regard, the tribunal should consider all the tests and standards in related areas brought to its attention without being bound by them. 
5. Once a tribunal has determined that relevant defects exist the tribunal is required to make an order to remedy those defects within a specified time. 

The tribunal held it as the building had a designation over 18 m this had a number of consequences: 

• The Respondent could apply for funding from the building safety fund to cover the cost of the proposed remediation works.  

• The building became a higher risk building so that the appropriate accountable person for the building was obliged to register the building with the building safety regulator under Part 4 of the BSA 2022.  

1. Could Section 20 C of the Landlord and Tenant Act 1925 protect leaseholders who held non-qualifying leases from the landlord transmitting the costs incurred in the proceedings into their service charge? 

The applicants applied for an order under Section 20 C of the Landlord and Tenant Act 1985 which if successful would prevent the landlord from transmitting any costs relating to the current proceedings into service charge. The tribunal stated that it had the discretion to make such an order if it considered it just and equitable to do so. The tribunal correctly stated that several qualifying leaseholders would not be liable for the costs due to the proceedings to the protection of Schedule 8 BSA 2022. However, non-qualifying leaseholders could potentially have to contribute to those costs as a service charge. The tribunal stated that the schedule out of the BSA 2022 does not remove the protection for non-qualifying leaseholders of Section 20 C. It merely extends lease holder protection for qualifying leaseholders. The tribunal found that the applicants had made a number of attempts to get information about remediation works from the respondents but had been unsuccessful in doing so. As a result, the applicants were justified in making the application for a remediation order and that application was in the main successful. The tribunal argued that 80% of the landlord’s costs arising from the proceedings should not be passed on to non-qualifying leaseholders through service charge.