Member Article

As the Building Safety Act 2022 slowly comes into force, the government has been required to publish various amendment Regulations that make clarifications and changes.

It is no secret that the Building Safety Act 2022 (BSA) and its provisions are often difficult to untangle and interpret.

It is, therefore, unsurprising that as the BSA slowly comes into force, the government has already been required to publish various amendment Regulations that make clarifications and changes, most recently to the leaseholder protection provisions in the ‘in occupation’ stage of a building’s life.

What are the changes?

The Building Safety (Leaseholder Protections etc) (England) (Amendment) Regulations 2023, published in draft on 12 June 2023, make amendments to other statutory instruments to:

1. Insert new definitions of “current landlord”, “named manager” and “shared ownership lease”, as scaffolding for other amendments to the Information Regulations. 
   
   In particular, the named manager is defined as being the person named in a particular lease - where this is a separate person from the freeholder or landlord - as having managing and repairing obligations in relation to the building or any part of it. 
2. Expand the list of interested persons that can apply for a remediation contribution order under s.124 of the BSA - requiring a specified body corporate or partnership to make payments towards remediation costs. The list now includes the newly defined named manager, the Homes and Communities Agency or any Resident Management Company (RMC) or Right To Manage company (RTM).
3. Change the provisions for recovery of amounts between landlords, so that where there are two or more responsible landlords their liability is joint and several.
4. Require the newly defined current landlord to share with the named manager, RMC or RTM copies of any leaseholder deeds of certificates it receives, which give information about the leaseholder’s interest. Where a current landlord fails to do so, it will be prohibited from using certain service charge funds to meet the costs of measures taken in relation to that building. 
5. Add a new circumstance in which a landlord’s certificate must be provided to leaseholders, where new or additional leaseholder deeds of certificates are provided that contain additional information. 
6. Confirm that where a landlord is responsible for a relevant defect, but has a net worth that means it does not meet the contribution condition, it will not have to provide information about group structure or accounts as part of its landlord’s certificate. 
   
   Landlords are likely to welcome this change, given the volume and cost of providing potentially commercially sensitive information that might have been required, in a situation where the landlord is not entitled to claim service charge in any event.
7. Substitute a new form of landlord’s certificate. This replaces the form set out in Schedule 1 to the Leaseholder Protections Regulations made in June 2022.

What next?

Whilst the amendment regulations seek to clarify the position and give further guidance on how to interpret the BSA, they also create further tangle. For example, in places even the regulations’ own explanatory notes contradict the wording in the draft statutory instrument, making it easy to confuse who is to provide what information to whom, and when. It is also important to note that the “current landlord” is not consistently defined across the regulations relating to the BSA.

It is likely that further regulations and amendments will be made as developers and landlords navigate the new system, should they come across further stumbling blocks or conflicting requirements. 

Higher-Risk Buildings (HRBs)

The government has also provided guidance on key criteria for determining whether a building is considered a higher-risk building during the occupation phase, which can be found here.

As explained in previously, HRBs are subject to additional registration and ongoing information gathering obligations, with penalties for non-compliance, so it is critical for building owners to be sure whether the regime applies.

The guidance considers the use criteria, legal definition and sets out the prescribed method as to how to measure the height and storeys of the building in order to determine whether it is a HRB, with helpful examples and diagrams. 

Developers and those that might be Principal or Accountable Persons under the new regime would be well advised to apply the guidance to their properties as soon as possible, given the requirement to register all existing HRBs with the Regulator before 1 October 2023.

 

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