Remediation Orders under the Building Safety Act 2022 (the BSA) can only be made in relation to 'relevant defects' but there is currently little specific guidance on what these are.
Whilst cases are now starting to trickle through the First Tier Tribunal (FTT) which are providing much-needed clarification to landlords in this respect, a recent case concerning internal fire compartmentalisation has failed to answer the question of whether a "relevant defect" can include internal fire safety remediation.
The FTT case of Mistry and Ors v Wallace Estates Limited (LON/00AH/HYI/2022/0012) had looked likely to provide some clarification around what sort of internal fire safety works would be considered 'relevant defects' under the BSA. Combustible cladding had already been removed, but leaseholders who made the application asserted that issues remained with a number of allegedly relevant defects namely flat entrance doors, internal doors, protected entrance hall, compartment walls between flats and common parts, compartment floor, smoke shaft and structural fire protection.
Whilst both parties had obtained their own experts' reports, some 3 weeks before the hearing, the landlord informed the leaseholders that it would not be contesting the leaseholders' expert evidence as its expert had identified 'issues in acting in this matter connected with his professional indemnity insurance'.
As a result, the landlord was forced to concede that the defects were 'relevant defects' . It was therefore common ground that a remediation order should be made and there was agreement in broad terms as to the defects which should be the subject matter of the order. All that remained to be decided was the precise terms of the order and the time limit for remediation.
The parties produced separate draft remediation orders, but ultimately, the differences between them were quite small. The only real point of contention was in relation to the level of specificity to be contained in the remediation order. Needless to say, the leaseholders argued for a greater level of detail, having become frustrated with what they perceived was the landlord's failure to engage with the compartmentation issue for a number of years. By contrast, the landlord argued that the order should be in more general terms, and that the tribunal's function was not to dictate how the landlord should carry out the work. The tribunal took the view that whilst the order should not go into granular detail, it "should be sufficiently precise so that the Respondent can know what it must do to remedy the relevant defects". Insofar as the time given for compliance was concerned, the tribunal ultimately ordered a compromise between the request of the leaseholders and landlord, setting this at 18 months.
Finally, the leaseholders also sought the following in so far as costs were concerned:
(i) They sought to recover their costs under Rule 13 which states that an award can be made “if a person has acted unreasonably in bringing, defending or conducting proceedings”. The tribunal declined to make an order under this provision;
(ii) Under section 20c of the Landlord and Tenant Act 1985, the leaseholders sought an order preventing the landlord from recovering the costs it incurred in the proceedings by way of service charge from the leaseholders. The tribunal found it just and equitable to make such an order, but made it clear that this decision was not to be taken as making it an inevitable result of a successful application whenever a remediation order is made.
As in this particular case consensus was reached as to what amounted to a relevant defect, we will have to await further decisions of the tribunal to ascertain what view the tribunal takes in this respect. However, what this case does highlight is the importance for landlords to ensure that their chosen expert's professional indemnity insurance provides adequate cover. Had the landlord's expert not had to withdraw from the case, the order made may have been different.
As a result, the landlord was forced to concede that the defects were 'relevant defects'. It was therefore common ground that a remediation order should be made and there was agreement in broad terms as to the defects which should be the subject matter of the order. All that remained to be decided was the precise terms of the order and the time limit for remediation.
The parties produced separate draft remediation orders, but ultimately, the differences between them were quite small. The only real point of contention was in relation to the level of specificity to be contained in the remediation order. Needless to say, the leaseholders argued for a greater level of detail, having become frustrated with what they perceived was the landlord's failure to engage with the compartmentation issue for a number of years. By contrast, the landlord argued that the order should be in more general terms, and that the tribunal's function was not to dictate how the landlord should carry out the work. The tribunal took the view that whilst the order should not go into granular detail, it "should be sufficiently precise so that the Respondent can know what it must do to remedy the relevant defects". Insofar as the time given for compliance was concerned, the tribunal ultimately ordered a compromise between the request of the leaseholders and landlord, setting this at 18 months.
Finally, the leaseholders also sought the following in so far as costs were concerned:
(i) They sought to recover their costs under Rule 13 which states that an award can be made “if a person has acted unreasonably in bringing, defending or conducting proceedings”. The tribunal declined to make an order under this provision;
(ii) Under section 20c of the Landlord and Tenant Act 1985, the leaseholders sought an order preventing the landlord from recovering the costs it incurred in the proceedings by way of service charge from the leaseholders. The tribunal found it just and equitable to make such an order, but made it clear that this decision was not to be taken as making it an inevitable result of a successful application whenever a remediation order is made.
As in this particular case consensus was reached as to what amounted to a relevant defect, we will have to await further decisions of the tribunal to ascertain what view the tribunal takes in this respect. However, what this case does highlight is the importance for landlords to ensure that their chosen expert's professional indemnity insurance provides adequate cover. Had the landlord's expert not had to withdraw from the case, the order made may have been different.
