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What’s New : Building Safety Bill

by

Ruth Barnes

A revised version of the Bill was published at the beginning of this month. Of particular relevance to sales is the proposal that Landlords will be able to recover costs via the service charge for “Building safety measures” but not for “excluded costs” (for higher risk buildings). The former effectively covers the cost of compliance, such as assessing and managing building safety risks, establishing and operating mandatory occurrence reporting systems. Excluded costs will include fines imposed by the regulator, legal costs incurred in relation to a special measures order and costs incurred as a result of any negligence, or unlawful acts. Landlords will need to serve a prescribed form detailing building information, the “Principal Accountable Person” and any special measures manager. If these proposals are passed, where possible we would suggest that this information is made available at point of sale.

It is also worth noting that that it is also proposed that the cost of remedying certain defects (including cladding remediation works) cannot be passed on the tenants if someone is responsible for the defect. There are other provisions setting annual limits on service charges for defects.

It is also proposed that developers provide purchasers with a new build home warranty with the developer undertaking to remedy defects within a specified period and with general cover for 15 years.

Finally the drafting includes a provision for resident management companies (RMC) to be Accountable Persons for higher risk buildings and for enforcement of the payment of service charges. The RMC may have to employ building safety directors and their renumeration will be deemed to be a service charge item. The RMC and its officers will be liable for breaches of the Act which may make RMCs slightly less attractive.

Legal Information sheets and leases may well need reviewing if all these measures are passed.

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