The Building Safety (Leaseholder Protections) (Information etc) (England) Regulations 2022 (regulation 5) allows current landlords faced with remediation costs for certain building safety defects to recover specified percentage contributions to those costs from other current landlords in the same building where recovery from building leaseholders via the service charge is prohibited under Schedule 8 to the Building Safety Act.
The recent case of Premier Ground Rents No1 Ltd v 36 Hornsey Road (London) RTM Company Ltd has shed some light on how this is intended to work. The RTM company for the building involved had served a regulation 5 notice on the freeholder, as a landlord of the building, seeking to recover a proportion of the costs (around £50,000) of repairing two cupolas and spires at the building.
36 Hornsey Road had originally been constructed as a school (hence the cupolas and spires) in around 1888 and converted to residential accommodation in 2009. By 2023, the cupolas and spires had been identified as structurally unsound and in danger of collapse. The RTM Company alleged that this was the result of long-term water ingress and a failure to take steps to prevent them becoming structurally unsound. The freeholder appealed the regulation 5 notice to the First-tier Tribunal.
Regulation 5 applies where a landlord “has paid or is liable to pay the cost of a relevant measure relating to a relevant defect”.
A “relevant defect” is a defect which arises as a result of anything done or not done in connection with relevant works and causes a building safety risk.
“Relevant works” include works of construction or conversion.
There was no doubt that the risk of the spires and cupolas collapsing constituted a building safety risk. However, the freeholder contended that the risk of collapse was not the result of anything done or not done as part of the conversion works.
The difficulty for the RTM Company was that there was little evidence of the condition of the spires and cupolas at the time the school was converted in 2009. Some work to towers had been planned but not, it seems, undertaken. The reason why the towers were now structurally unsound was unclear – expert evidence referred to water ingress but also to subsidence. There was no evidence that the towers had been identified as structurally unsound in 2009. The RTM Company argued that if works had been carried out to the towers in 2009, the structural issues would have been identified and so the defects “arose” as a result of something “not done” in connection with the conversion works. But the absence of any evidence supporting that case and the lack of any clarity as to what works (if any) had been undertaken in 2009 meant that the Tribunal could not reach a finding as to the condition of the cupolas at the time of the conversion works.
Thus, while a failure to carry out necessary works can fall within the scope of a “relevant defect”, this case is a reminder that there must be a clear causative connection between such omissions and the existence of a relevant defect. In this case, although there may have been a (potential) failure to carry out maintenance works during conversion works, the necessary causal connection between that failure and the defects identified in 2023 was lacking. The learning point here is for landlords to make sure that they have clearly identified the nature of any defects and have sufficient supporting technical evidence before they seek to recover remediation costs under regulation 5.
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