[2025] UKUT 298 (LC)

The purpose of the BSA is “to make provision about the safety of people in or about buildings and the standard of buildings….” The BSA is substantial and wide ranging. It is in 6 Parts which inter alia establish a building safety regulator (Part 2), amend the Building Act 1984 (Part 3), make specific provision in respect of the management and maintenance of “higher risk buildings” (Part 4). Part 5 includes provisions about remediation and redress, a new homes ombudsman, construction products, fire safety, the regulation of architects and about housing complaints.

We are concerned with the earlier provisions of Part 5, namely sections 116 – 124 and Schedule 8. An overview of this part of BSA was given by the Court of Appeal in Triathlon Homes LLP v Stratford Village Development Partnership [2025] EWCA Civ 846 and Adriatic Land 5 Limited v Long Leaseholders at Hippersley Point [2025] EWCA Civ 856 where Lord Justice Newey said as follows:

“13.

The BSA’s long title identifies one of the purposes of BSA as “to make provision about the safety of people in or about buildings and the standard of buildings”. Part 5 of the BSA, comprising sections 116-160, contains, as its heading states, “Other provision about safety, standards etc”. Section 116(1) explains that sections 117-124 and schedule 8 “make provision in connection with the remediation of relevant defects in relevant buildings”. 

14.

Schedule 8 to the BSA is introduced by section 122 . As section 122 states, schedule 8 : 

“(a)

provides that certain service charge amounts relating to relevant defects in a relevant building are not payable, and 

(b)

makes provision for the recovery of those amounts from persons who are landlords under leases of the building (or any part of it).”

Subject to certain exceptions, a “relevant building” is “a self-contained building, or self-contained part of a building, in England that contains at least two dwellings and (a) is at least 11 metres high, or (b) has at least 5 storeys”: see section 117(2) . “Relevant defect” is defined by section 120(2) to refer to “a defect … that (a) arises as a result of anything done (or not done), or anything used (or not used), in connection with relevant works, and (b) causes a building safety risk”. By respectively section 120(5) and section 120(3) , “building safety risk” is “a risk to the safety of people in or about the building arising from (a) the spread of fire, or (b) the collapse of the building or any part of it” and “relevant works” means any of the following: 

”(a)  works relating to the construction or conversion of the building, if the construction or conversion was completed in the relevant period; 

(b)

works undertaken or commissioned by or on behalf of a relevant landlord or management company, if the works were completed in the relevant period; 

(c)

works undertaken after the end of the relevant period to remedy a relevant defect (including a defect that is a relevant defect by virtue of this paragraph).”

The “relevant period” is specified as the period of 30 years preceding the coming into force of section 120: see section 120(3).

15.

  Paragraph 2 of schedule 8 to the BSA provides that no service charge “is payable” under a lease of premises in a relevant building in respect of a “relevant measure” (i.e. a measure taken to remedy a defect or a “relevant step” taken in relation to a defect) relating to a relevant defect if the landlord or any superior landlord at the beginning of 14 February 2022 “(a) is responsible for the relevant defect, or (b) is associated with a person responsible for a relevant defect”. For the purposes of paragraph 2, a person is “responsible for” a defect if:  

“(a)

in the case of an initial defect, the person was, or was in a joint venture with, the developer or undertook or commissioned works relating to the defect; 

(b)

in any other case, the person undertook or commissioned works relating to the defect.”

16.

Unlike paragraph 2, paragraphs 3-9 of schedule 8 to the BSA apply only in relation to “qualifying leases”. By section 119(2) , a lease is a “qualifying lease” if:

(a)

it is a long lease of a single dwelling in a relevant building,

(b)

the tenant under the lease is liable to pay a service charge, 

(c)

the lease was granted before 14 February 2022, and

(d)

at the beginning of 14 February 2022 … —

(i)

the dwelling was a relevant tenant’s only or principal home,

(ii)

a relevant tenant did not own any other dwelling in the United Kingdom, or

(iii)

a relevant tenant owned no more than two dwellings in the United Kingdom apart from their interest under the lease.’

A “relevant tenant” is a person who was a tenant under such a lease at the beginning of 14 February 2022: see section 119(4)(c) . Where, however, a dwelling was at that point let under two or more leases to which subsection (2)(a) and (b) apply, “any of those leases which is superior to any of the other leases is not a ‘qualifying lease’”: see section 119(3) . (For completeness, I should mention that a new section, section 119A , was added by the Levelling-up and Regeneration Act 2023 to extend the protection for leaseholders where a “qualifying lease” has been extended, varied or replaced by a new lease.)

17.

Paragraphs 3-9 of schedule 8 to the BSA all serve to relieve tenants with “qualifying leases” from liability for service charges. By paragraph 3 , no service charge “is payable” under a qualifying lease in respect of a relevant measure relating to a relevant defect if the net worth of the landlord’s group at the beginning of 14 February 2022 was more than a specified multiple of £2 million (the “contribution condition”). By paragraph 4 , no service charge “is payable” under a qualifying lease in respect of a relevant measure relating to a relevant defect if the value of the qualifying lease at the beginning of 14 February 2022 was less than either £325,000 (in the case of property in London) or £175,000 (elsewhere). By paragraph 5 , a service charge which would otherwise be payable under a qualifying lease in respect of a relevant measure relating to a relevant defect “is payable” only in so far as service charges over a period extending back five years have not exceeded the “permitted maximum” set by paragraph 6 . By paragraph 7 , a service charge which would otherwise be payable under a qualifying lease “is payable” only in so far as service charges over the previous 12 months have not exceeded the “permitted maximum”. By paragraph 8 , no service charge “is payable” under a qualifying lease in respect of the removal or replacement of any part of a cladding system that forms the outer wall of an external wall system, and is unsafe.”

Thus, section 122 and schedule 8 to the BSA provide a scheme where lessees are protected from the burden of paying service charge costs to a greater or lesser extent depending on which of the various protections in schedule 8 they are entitled to rely upon.

Paragraphs 2, 3 and 4 of schedule 8 are all stated to be intended to mitigate the costs of remediation by the taking of “relevant measures” to address “relevant defects.” The cap in paragraph 5 only applies to such measures.

Paragraph 8 is also confined to qualifying leaseholders but makes no mention of “relevant measures” or “relevant defect.” It states:

“8(1) No service charge is payable under a qualifying lease in respect of cladding remediation.

(2)

In this paragraph “cladding remediation” means the removal or replacement of any part of a cladding system that –

(a)

forms the outer wall of an external wall system, and

(b)

is unsafe.”

Against that background the primary issue in this case can be more easily understood. Put simply the question is whether paragraph 8 of schedule 8 applies to defective cladding which is not also a “relevant defect” and if so, are the works that are proposed to the façade of CPH “cladding remediation” within the meaning of paragraph 8?

As already noted, the FTT had found that the defects to the façade of CPH originated in its original design and construction which took place between 1963 and 1966. By section 120 a “relevant defect” is a defect that, as a result of “relevant works,” causes a building safety risk. By section 120(3) relevant works must have been carried out within the “relevant period” being 30 years ending with the date the section came into effect which was 28^th June 2022. The works proposed to CPH cannot therefore be “relevant measures” to address “relevant defects.”

In respect of the first question, namely whether the ambit of paragraph 8 extends to cladding works which are not necessarily “relevant defects” the FTT found that: “220. We are satisfied that the ordinary and clear meaning to be given to the words of paragraph 8 is that cladding remediation is to be treated as a distinct protection outside of the waterfall, not contingent on there being a ‘relevant defect’ and therefore not incorporating the requirement that the cladding in question needs to have been put on the building within the relevant period - the 30 years preceding 14 February 2022 - as section 120 is not engaged…..”

The background to sections 116-124 of the BSA is described in Adriatic as follows:

“28.

The Bill which became the BSA was introduced to Parliament on 5 July 2021. At that stage, the principal purpose of the Bill was to give legal effect to recommendations which had been made in a 2018 report by Dame Judith Hackitt on building regulations and fire safety. The Bill also included (to quote Mr Murphy):

“some measures to protect leaseholders and improve redress in respect of historical building safety defects, namely by retrospectively extending the limitation period under section 1 of the Defective Premises Act 1972 claims from six to 15 years (so that leaseholders would be better able to recover the costs of putting work right from those who caused the problem) and by requiring landlords to explore alternative cost recovery before passing costs on to leaseholders.”

29.

On 10 January 2022, the Government announced that it had “reset its approach to building safety with a bold new plan to protect leaseholders and make wealthy developers and companies pay to fix the cladding crisis”. Soon afterwards, on 13 January, the Government tabled amendments to the Building Safety Bill. A further and more substantial set of amendments followed on 14 February (when the Bill was at the Committee stage in the House of Lords) and some additional amendments were put forward on 22 March (at the House of Lords Report stage). The amendments introduced for the first time what became sections 116-125 of the BSA and schedule 8 to it ….”