Building Safety Act 2022: an introduction

Described as “the biggest change to building safety regulation in a generation“, the Building Safety Act 2022 (the Act) aims to tackle some of the fundamental safety issues highlighted by the Grenfell Tower disaster. Broadly, the Act widens the duties applying to landlords of residential buildings now considered a higher risk to remediate defects and ensure they meet the required safety standards.

The Act creates two key roles – Building Safety Regulator and Accountable Person.

Building Safety Regulator

The Building Safety Regulator (BSR) oversees safety and performance systems. As such, they have the power to enforce the rules and take action against those in breach. And for higher-risk properties, they can impose stricter rules covering design, construction, and occupation.

Although primarily aimed at taller buildings, ie those at least eleven metres high or five storeys, parts of the Act have implications for all buildings. That’s because the BSR’s responsibility extends to the performance of the building control sector and setting building standards.

Accountable Person

The Accountable Person (AP) can be the building’s owner, freeholder, or the management company. They have a continuing duty to assess building safety risks and provide a ‘Safety Case Report’ (SCR). The SCR must demonstrate how building safety risks are identified, mitigated, and managed. And the AP must also show precisely how they ensure residents’ safety.

Sometimes, building ownership structures are complex. So, in such cases, there may be more than one AP, with one of them being the Principal Accountable Person.

Who pays the costs?

Crucially, the Act regulates the costs landlords can recoup from tenants for any required remediation works to their building. But the applicable test is very far from straightforward.

So, if on 14 February 2022:

• the tenant occupied the property as their only or principal home; and
• on that date, the tenant owned no more than two UK dwellings in addition to the property concerned, then
• the landlord must cover the cost of most remedial works.

And significantly, the landlord cannot recover those costs through the service charge.

If a tenant cannot meet these criteria, the cost of any required remedial works is recoverable through the service charge. However, there is an exception if the original developer or an associated company still owns the building when the cost becomes that of the building owner.

What about enfranchised properties?

The Act’s financial protection does not extend to buildings where the leaseholders have collectively enfranchised. That’s because, in this situation, the leaseholders are the freeholder, ie there is no separate party with whom to share costs.

What does this mean for selling your flat?

Post-Grenfell, tens of thousands of flat owners are left in limbo in unmortgageable and, therefore, virtually unsaleable properties.

In the future, those selling a flat within a residential building caught by the Act must serve a ‘Leaseholders Deed of Certificate’ (LDC) on their landlord. The LDC determines whether the lease of the flat is a ‘qualifying lease’ under the Act. If so, the tenant has statutory protection against costs for any required remediation works. Therefore, establishing whether the lease is a ‘qualifying lease’ is critical, and understanding the leaseholder’s circumstances as at 14 February 2022 is fundamental to this.

The landlord must serve a ‘Landlord’s Certificate’ within four weeks of receiving the LDC. The certificate sets out any required remediation works due to the building. Potential buyers will need to know whether these certificates have been served and received. Indeed, these new requirements are now incorporated into the standard Leasehold Property Enquiries Form (LPE1).

It’s worth noting that these additional requirements have the potential to cause delay in the conveyancing process, so we strongly advise putting them in hand on marketing the property.

EWS1

Another important point is that the Act does not negate the need for an ‘External Wall System Fire Review Certificate’ (EWS1). But even if the EWS1 does not specify any fire safety remediation works, that does not necessarily mean no works are required under the Act.