Building Safety: Case Law Developments & Practical Implications
Since the enactment of the Building Safety Act 2022 (“BSA”) three years ago, the property sector has undergone a period of substantial reform. In this blog, we highlight the practical implications of the BSA as they are unfolding and consider recent case law developments, outlining emerging risks and responsibilities that legal and property professionals must navigate.
Grey GR Limited Partnership v Edgewater (Stevenage) Limited and others (“Vista Tower”)
The First-tier Tribunal’s decision in the case known as “Vista Tower” earlier this year marked a significant development in the interpretation of Remediation Contribution Orders (RCOs) under the BSA. The freeholder of a high-rise block with serious fire safety defects secured a £13 million RCO against the developer and its associated entities. The ruling provided guidance, such as a broad interpretation of “defect” and “building safety risk” under Section 120, not confined to historic building regulation breaches.
The Tribunal confirmed that RCOs are non-fault-based and guided by what is “just and equitable,” enabling liability to extend beyond the corporate veil to associated entities. Developers and their associates were reaffirmed as the primary targets, above investors, leaseholders, and the public purse. The ruling also signals a broad approach to RCOs ahead of the awaited Triathlon Homes decision. However, this week the Upper Tribunal has given permission to appeal the FTT’s decision, specifically in regard to the jurisdiction of the FTT to make an RCO jointly and severally against multiple corporate entities and considering the best approach to the ‘just and equitable’ test where there are numerous companies involved.
Adriatic Land v Hippersley Point and Triathlon Homes LLP v Stratford Village Development Partnership raise the same fundamental issue: do the leaseholder protections in the Building Safety Act 2022 apply to costs incurred before the Act came into force?
In Hippersley Point, the focus is on paragraph 9 of Schedule 8, which restricts the recovery of legal and professional costs via service charges where those costs relate to liability for relevant defects. The Upper Tribunal previously held that this protection applied retrospectively, preventing the landlord from recovering pre-BSA dispensation costs. The Court of Appeal will now revisit that conclusion, which may determine whether the wider Schedule 8 protections similarly shield leaseholders from historic liabilities.
In Triathlon Homes, the Court of Appeal will consider the retrospective reach of Remediation Contribution Orders (RCOs) under section 124 BSA. The First-tier Tribunal had granted an RCO that required developers and associated landlords to contribute to remediation costs incurred prior to the Act’s commencement. The appeal addresses both the temporal scope of RCOs and the application of the “just and equitable” test.
Judgment for both cases is anticipated imminently and will hopefully provide much-needed clarity on the extent to which the BSA protects leaseholders from historic building safety costs.
Almacantar Centre Point v Various Leaseholders of Centre Point House
This adjourned Upper Tribunal appeal listed for later this year will consider the scope of paragraph 8 of Schedule 8 BSA and its restriction on recovering cladding replacement costs via service charges. The definition of a “cladding system” is expected to be central - an issue critical for landlords aiming to pass on remediation costs.
From Policy to Practice:
The BSA established three new bodies to ensure effective oversight of the new regulatory framework: the Building Safety Regulator, the National Regulator of Construction Products, and the New Homes Ombudsman. The BSA also introduces a range of provisions, including guidance on the identification of HRBs, the appointment of duty holders responsible for building safety, and the extension of limitation periods for building safety-related claims.
The establishment of the Building Safety Regulator under the BSA intended to create a robust framework for enhancing building safety standards in respect of HRBs. In principle, this development is a necessary evolution in the regulatory landscape. However, in practice, the BSR’s ability to effectively manage the Gateway 2 approval process appears to be significantly hindered by capacity issues according to a report by Inside Housing. Between October 2023 and September 2024, only 14% of applications were approved. The delays seem to stem from a combination of factors, including the volume of applications and a lack of clarity surrounding the new application process. The current operational challenges are resulting in substantial delays, which may undermine the BSR’s intended efficiency and effectiveness.
Another significant regulatory innovation under the BSA is the introduction of the golden thread, being a digital record of key building safety information that must be created, maintained, and handed over throughout the lifecycle of a higher-risk building (HRB). The types of information required are governed by Regulation 31 of the Building (Higher-Risk Buildings Procedures) (England) Regulations 2023. The aim is to ensure that duty holders and Accountable Persons have continuous access to structured, accurate and shareable data necessary for managing building safety risks.
While these developments represent a necessary shift towards a stronger oversight of building safety, their success will depend on how effectively the new regulatory mechanisms operate in practice. Addressing the capacity issues within the BSR and refining the application processes will be key to ensuring that the regulatory framework functions as intended. As the system develops, legal and property professionals will play a vital role in ensuring compliance.
