Building Safety

Once a building is completed, responsibility for the life of that building is immediately passed to the “accountable person” and “principal accountable person”.

For new buildings, these identified persons take responsibility post planning. For existing buildings a review of the leasehold arrangements  is required to identify who is accountable.

We can support on that analysis.

For cladding product claims claimants can now recover damages directly from the product manufacturer/supplier if the product either fails to meet relevant standards/requirements or is inherently defective and this causes a dwelling to be ‘unfit for habitation’. This may be useful to both building owners and leaseholders. It could also assist contractors in pursuing a contribution claim against the supplier/manufacturer. We can help in assessing potential claims (including contribution claims) against the original manufacturer/supplier.

Where unsafe cladding has been supplied or installed a claim for replacing the cladding and/or damages can be brought against the responsible contractor or designer, as well as associated companies or entities. Privity of contract is not necessarily a prerequisite and therefore owners and leaseholders now have the opportunity to recover some of the costs associated with remedying unsafe cladding to make buildings safe. We are able to advise on the viability of making such a claim and what a potential recovery might look like.

Bringing a claim for works which do not comply with Building Regulations has been made easier.  The introduction of Section 38 of the Building Act 1984 (which was in existence previously but not in force) means that a new statutory cause of action exists which permits a claim for breach of Building Regulations.  In the past, breach of Building Regulations was not actionable in and of itself – instead claimants would need to rely on a breach of other express or implied contractual terms. This cause of action will therefore be particularly helpful for many leaseholders where a contractual relationship with the contractor may not exist. We can assist in seeking resolution and rectification where there’s been a breach of Building Regulations.

Remediation Orders may be obtained against a landlord with a repair and maintenance obligation requiring them to carry out specified remedial works by a specified time at their own cost in respect of relevant defects.

Remediation Contribution Orders may be granted against landlords, developers and associates where it is “just and equitable to do so” requiring them to make payment to a specified person for the purpose of remedying relevant defects.

The First Tier Tribunal deals with both and we can provide support with any application.

In development projects, it is common practice for developers to create a corporate structure creating subsidiary companies such as shell companies or SPVs (Special Purpose Vehicles). These types of companies typically have complex legal structures but keep limited assets, and at the end of a project they will often transfer any assets to another part of the business and dissolve the company. The primary purpose of a Building liability Order (BLO) is to prevent developers escaping civil liability for safety defects by hiding behind these legal structures. The aim of a BLO is to ensure that the original developer (or other liable party) funds any remedial work required.

We can help with providing advice in relation to BLOs.  We have advised a number of times on whether other companies that are less obvious can be found liable for the costs or remediation.  This is a highly unusual ability for the courts to look past corporate limited liability and should be an effective tool to ‘follow the money’.

The BSA extends the limitation period for claims made under the Defective Premises Act 1972 (DSA) (which imposes a duty on those constructing dwellings to do so in a workmanlike manner, using proper materials, so that the dwelling is fit for habitation) from six years from practical completion (including latent defects), to either a 30-year limitation period for dwellings completed prior to 28 June 2022, or a 15-year limitation period for dwellings completed after 28 June 2022.

Developers who have signed up to the Government’s ‘Bilateral Agreement’ to remediate life-critical fire-safety remediation work arising from the design, construction or refurbishment of buildings of 11 metres and above are obliged to either undertake the works at their own cost, procure the works at their own cost through a suitably qualified contractor or fund the costs of a third party with responsibility for the affected building for procuring the works.

There are a number of considerations for both developers and management companies (entities with responsibility for the building) in selecting the right option. These include expediency of the works, the availability of local labour and the supply chain, the significance of the defects and the likelihood of risks materialising as well as, cost. Understanding the various options available to you (whether as a developer or a management company), the benefits and drawbacks of each option and allowing for a frank conversation to take place between all involved parties at the outset, goes a long way into ensuring that life-critical safety defects are remediated as quickly as possible, per the Government’s intention.

We have extensive experience of advising both developers and management companies of affected buildings in this regard, including advising on some of the first implementations of these arrangements in the market. This early involvement means that we understand and are well placed to advise on the issues that a likely to arise (such as in relation to allocation of liability and which of the remediations options is likely to be most appropriate in any given scenario).

Whilst the BSA is in its infancy, there are many pre-existing landlord and tenant relationships that will require analysis in terms of delivering safer buildings. In any leasehold situation, questions will arise out of repairing obligations, how those complement statutory obligations, and in particular how issues such as supersession will be managed in light of this legislation. Who is liable for these costs will also require close scrutiny of the relationship between the relevant parties, the service charges, and applicable statutory requirements during the landlord and tenant relationship.

The obligation to register with the regulator for all entities who will be deemed “accountable persons” and “principal accountable persons” has now passed.  Any outstanding registrations need to be expedited and all the information sought from the regulator provided without further delay.

Those who take responsibility for buildings in the future need to ensure that the statutory obligation to identify themselves and their involvement is dealt with appropriately.

The BSA confers a host of new obligations on numerous parties.  Often obligations will overlap and or be duplicated.  In the main, those with a repair and maintenance obligation will have increased obligations relating to safety matters and administrative requirements (whether that be a Landlord or a Right to Manage company) while Developers and Landlords may find they have an obligation to remediate as a result of the BSA.  If you are in any way unsure of whether you need to take action, we can assist with that.

The BSA and the regulations that go alongside it, offer leaseholder protections against costs through service charges for remediation of ‘relevant defects’ in ‘relevant buildings’. In certain circumstances both a Landlord’s Certificate and Leaseholder Deed of Certificate will be required to confirm their respective status and the ability to recover costs for remediation. We have been helping Landlord’s navigate their responsibilities in providing the Landlord’s Certificate by providing advice as to whether one is required and also the interpretation of the BSA requirements in this respect. As a Landlord, early advice is absolutely necessary to understand your obligations not only to ensure sales of leasehold properties within the building can complete without unnecessary delay, but also to ensure that recovery of the costs of remediation can be passed via the service charge by complying with the timings imposed by the BSA on the production of the Landlord’s Certificate.

One of the most notable and talked about elements of the Act 2022 is the creation of the Building Safety Regulator, or the “BSR”.  Under the Act, the Health and Safety Executive (“the HSE”), with its decades of experience setting standards for and the monitoring and enforcement of, the rules of workplace health and safety, will take on equivalent responsibilities in relation to higher-risk buildings.  It is hoped (and we would expect) that the HSE’s experience of providing detailed and helpful guidance to employers, as well as navigating the rules required for them to ensure fair investigations and proportionate regulatory enforcement, will stand officers in good stead.

Our Regulatory lawyers have worked closely with businesses and directors advising in response to HSE investigations over decades.  We have used this experience to provide bespoke training to clients on the Act, looking at the timeline for BSR involvement as well as their approach to regulatory enforcement, to provide insight in relation to operational decisions that are required.

This training has addressed the thorny issue of potential sanction(s) given the Act creates criminal offences relating to different stages of the construction process.  It is vitally important that businesses are aware of the implications of action / inaction now, so that risks may be understood and mitigated in a timely manner.

Going forward, businesses many be concerned about the preparation of the Safety Case or Safety Case report or have received adverse looking correspondence is received from the BSR.  Our Regulatory lawyers are on hand to guide you through the regulatory maze so that you may properly understand and mitigate regulatory risk.