The Building Safety Act 2022 – overview and guide
What is the Building Safety Act (BSA) 2022?
The BSA 2022 was introduced to regulate the construction and management of higher-risk buildings.
In most leases, the landlord is the ‘responsible person’ for the building and thus for completing any required works. Landlords then recharge the associated costs to leaseholders by way of a service charge.
Under the BSA 2022, protections have been introduced for qualifying leaseholders against charges relating to fire safety works and some non-cladding defects. The act states that certain service charge amounts relating to relevant defects in a relevant building are not payable.
It is important to note that although the BSA 2022 awards this protection, where the landlord has a lower net worth or is not linked with a developer, leaseholders may still have to pay costs which could be capped.
What is a ‘relevant building’?
A building which is at least 11 metres tall, or at least 5 storeys tall and containing at least 2 dwellings. Leaseholder-owned buildings are not classed as relevant buildings.
What is a ‘relevant defect’?
A defect attributable to inappropriate or defective works undertaken in the past 30 years, or in the future, which may cause a building safety risk. This being a risk to the safety of people in the building arising from the spread of fire, or the collapse of the building.
What is a ‘qualifying lease’?
A lease where the below apply:-
- the lease has been granted for a term of at least 21 years;
- the lease was granted prior to 14 February 2022;
- the lease requires the leaseholder to pay a service charge; and
- as of 14 February 2022, the property was the leaseholder’s main and only home, or the leaseholder did not own more than 3 properties in the United Kingdom.
What are the consequences where a lease does not qualify?
Some leases are excluded under the BSA 2022 and are therefore not granted the same protections as qualifying leases, examples being new leases and existing leases which were extended or varied after 14 February 2022.
Where a lease does not qualify, leaseholders may be asked to contribute towards remedial works by way of service charges. As above, this is standard, however leaseholders may be concerned given that such remedial works usually cost substantially more than normal and expected maintenance and repairs. Furthermore, it is likely that such costs will need to be paid immediately rather than gradually recovered.
Please note, it is possible for leases to continue ‘qualifying’ where extended or varied after 14 February 2022.
Deed of Certificate
A Deed of Certificate is issued by the current leaseholder of the property and will confirm whether the leaseholder/lease is eligible for leaseholder protections – this will also be used in calculating any remediation cap. A leaseholder may send a completed Deed of Certificate to their landlord at any time. However, where a landlord notifies a leaseholder that they require a Deed of Certificate, the leaseholder must complete and return this within the specified period. If this is not completed, the lease/tenant will not benefit from the protections of qualifying leases.
A Landlord’s Certificate must be provided:-
- where a landlord wishes to pass remediation costs to leaseholders by way of service charge;
- within 4 weeks of notification that a leasehold interest is to be sold;
- within 4 weeks of becoming aware of any relevant defect; or
- within 4 weeks of a leaseholder requesting a Landlord’s Certificate.
If a landlord does not provide a valid certificate, they will be prevented from passing remediation costs to leaseholders.
There are new regulations being discussed which will revise these requirements, however, these have not yet been finalised or come into force. There are also plans to introduce amendments under which Right to Manage and Residents Management Companies would have increased responsibilities in relation to higher risk buildings.
If you are not sure whether or not your lease or any lease in your building is a qualifying lease, please contact our Real Estate and Enfranchisement team where our expert solicitors would be pleased to assist.