Cladding – Is There Any Hope on the Horizon?

The short answer for leaseholders, in the near term, is no.

Cladding has become the latest property controversy, following the recent leasehold scandals of escalating ground rents and leaseholders being charged eye-watering sums for the purchase of their freehold interest in the case of leasehold houses. Unsafe cladding is an issue that took the tragedy of the Grenfell Tower disaster in 2017 to come to light.

The Government’s answer appears to be the Building Safety Bill, due to come into force next year. The Bill will apply to all “higher risk” buildings, defined as any building containing two or more residential dwellings and which is more than 7 storeys or more than 18 metres tall. The Bill will designate an “Accountable Person” and this Person will be required to appoint a Building Safety Manager.

However, this does not assist leaseholders in other apartment settings and even for those in “higher risk” buildings, most modern leases allow the recovery of costs arising under statute. This means that clause 84 of the proposed bill will make leaseholders responsible for the cost of remediating risk, but how they will be expected to afford this is another matter.

In addition, leaseholders will need to pay for any litigation costs. The only minor consolation is that the limitation period is being extended from 6 years to 15 years.

The Fire Safety Act 2021 is also expected to come into force after the Building Safety Bill. The Act will require every building with two or more residential dwellings and of any height to have its external walls assessed annually. It may also require 6 monthly inspections of fire doors.

Again, all of the costs of this new inspection regime can most likely be recovered from variable service charges. Litigation is almost certainly going to follow.

For lawyers (and also clients), this means that more checks are going to have to be carried out and the conveyancing process for some leasehold properties is going to be longer. Whilst under the Fire Safety Act 2021, a new assessment (PAS 9980) is likely to replace the EWS-1 form, we should continue requesting the EWS-1 from management companies for now.

Contact our Conveyancing solicitor Ben James on 0121 233 6912 or bjames@blackhams.com for any further advice.