Making sure remediation work is done

Summary

1. The Building Safety Act 2022 created legal protections for leaseholders from historical building safety costs. The Act protects qualifying leaseholders from all costs relating to the remediation of unsafe cladding systems and contains robust protections from non-cladding remediation costs.

2. While the government expects that building owners will meet their legal obligations to meet the costs of remediation, there are likely to be a few who try to avoid these liabilities (the definition of ‘Building Owner’ can be found in What are my building owner’s legal obligations?).

3. Anti-avoidance and enforcement provisions have therefore been included in the Act – including remediation orders and remediation contribution orders – to ensure that those who are liable to pay under leaseholder protections actually do so.

4. Relevant authorities have the power to compel responsible entities to fund and undertake the necessary remediation work. Where firms are repeatedly refusing to pay to fix these buildings, the government’s new Recovery Strategy Unit will pursue these firms through any means necessary, working closely with other enforcement authorities.

5. For more information on what the government is doing to provide new rights to redress, visit the redress factsheet.

Remediation orders

6. Remediation orders will allow interested persons to apply to the Property Chamber of the First-tier Tribunal for an order requiring a building owner to remedy specified relevant defects.

7. Interested persons include:

• the Building Safety Regulator
• the local authority for the area in which the building is located
• the fire and rescue authority for the area in which the building is located
• the Secretary of State
• any person with a legal or equitable interest in the building or any part of it - a person with a legal or equitable interest in the building will include, for example, leaseholders of flats within the building, as well as the freeholder and other building owners for the building

8. Remediation orders can be made against building owners, as well as management companies with repairing obligations, freeholders, and superior landlords such as headlessees with repairing obligations (a superior landlord is a landlord who owns the interest in the property which gives them the right of possession at the end of another landlord’s lease).

9. In circumstances where a building owner has had a remediation order applied to them and they are not fixing the defect, then it is enforceable by the county court.

Step-by-step guidance - remediation orders

10. This step-by-step guide sets out how the legal mechanism for remediation orders will work in practice.

11. If a party with responsibility for remediating a building (a building owner or a developer), fails to meet its obligations, a remediation order can be applied for.

12. An interested person can apply for a remediation order to the Property Chamber of the First-tier Tribunal.

13. On the application of an interested person, if the First-tier Tribunal considers it just and equitable, it can file a remediation order, ordering the building owner or developer to remedy relevant defects on their own buildings.

14. If a building owner or developer receives a remediation order, they must fix the defect specified in the remediation order by the specified timeframe.

15. If, once the remediation order has been issued, the building owner or developer has not remediated the building in the specified timeframe, they can be held in contempt of court. Contempt of court can be punishable by a fine or up to 2 years in prison.

Remediation contribution orders

16. Remediation contribution orders allow interested persons to apply to the Property Chamber of the First-tier Tribunal for an order requiring a company to make payments in connection with the remediation of relevant defects.

17. Interested persons here include all those who can apply for a remediation order (see paragraph 6 of this section), and also a special measures manager (as defined in Schedule 7 to the Act) where one has been appointed for a building above 18 metres in height.

18. A remediation contribution order can be made against:

• a building owner
• a person who was a landlord on 14 February 2022
• the building’s developer
• any person associated with any of these parties

19. Remediation contribution orders will allow building owners to seek to recover remediation costs from the building’s developer by applying to the Property Chamber of the First-tier Tribunal for an order against the developer. They will also allow leaseholders to recover remediation costs from building owners, developers and associated parties.

Step-by-step guidance - remediation contribution orders

20. This step-by-step guide sets out how the legal mechanism for remediation contribution orders will work in practice.

21. If a party is legally liable to financially contribute to the remediation of a building, but is failing to do so, then a remediation contribution order can be applied for.

22. A Remediation contribution order can be filed against the parties outlined in paragraph 17 above.

23. An interested party applies to the Property Chamber of the First-tier Tribunal for an order compelling a party (developer, building owner or associated person) to make payments, to meet costs incurred in remedying relevant defects.

24. If the First-tier Tribunal considers it just and equitable, it can file a remediation contribution order; ordering the party (building owner, developer or any ‘associated person’) to make payments in connection with the remediation of the building, within a specified timeframe.

25. Remediation contribution orders can be used to:

• require a developer or building owner for the building, or their associated companies, to make payments in connection with remedying relevant defects
• allow recovery of costs from the building’s developer by applying to the Tribunal for an order against the developer
• require that leaseholders are reimbursed for costs already paid out for remediation works

26. If, once the remediation contribution order has been issued, the building owner, developer or associated person has not contributed to payments in connection with the remediation the building in the specified timeframe, they can be held in contempt of court. Contempt of court can be punished by a fine or up to 2 years in prison.

Resolving leasehold disputes

27. In addition to applying to the Property Chamber of the First-tier Tribunal for a remediation order or a remediation contribution order, leaseholders can also apply to the Tribunal to resolve other leasehold disputes.

28. For more information, please see leasehold disputes].

How does this affect me, the leaseholder?

29. You can apply to the Property Chamber of the First-tier Tribunal for a remediation order if your building has historic fire safety defects, has been assessed and needs to be remediated, but the work has not yet commenced. If the work does not begin within the timeframe the First-tier Tribunal states in their judgment filing of a remediation order, then the decision can then be filed with and enforced as if it was an order of the county court.

30. You can apply for a remediation contribution order to recover the costs you have already paid towards remediation before the leaseholder protections came into force.

31. You could also apply for a remediation contribution order against persons associated with the developer to recover remediation costs. This could be necessary where, for example, the development has been built by a special purpose vehicle, (for instance, a company which is thinly capitalised, or if a subsidiary developer has since been wound up, but the parent company still exists and has the resources to fund the work).

32. You would be liable for the associated costs of any action brought about by yourself, including the £100 application fee to the First-tier Tribunal.

Examples

Example 1:

• A high-rise residential building has a number of historical cladding system and non-cladding defects. Despite the remediation of these defects being life-safety critical, work to remediate them has not yet started, 3 years after they have been identified.
• The fire and rescue authority inspects the building and considers that the work needs to begin to make the building safe. The building owner does not undertake the work despite leaseholders and the fire and rescue authority attempting to contact them to insist on the work getting underway.
• An interested person (such as the fire and rescue authority) applies to the First-tier Tribunal for a remediation order. The Tribunal makes an order, requiring the building owner to remedy the defects within a specified time period.

Example 2:

• A high-rise residential building has a number of historical cladding systems and non-cladding defects. In 2020, leaseholders paid to have the cladding system removed because the developer and building owner refused to pay the remediation costs. Leaseholders can now apply to the First-tier Tribunal for a remediation contribution order, to recover the remediation costs from the developer and building owner that were previously paid out.
• If the First-tier Tribunal considers that it would be just and equitable to make an order requiring the developer and building owner to make payments to the leaseholders to cover the costs paid out to remove the cladding system from the building. The Tribunal will issue an order requiring them to make payments to the leaseholders, specifying the time by when payments must be made.