Following the fire at Grenfell Tower in June 2017, the Ministry of Housing, Communities & Local Government has recently released a consultation seeking views on a new building safety regime. Read the article: Building a safer future: proposals for reform of the building safety regulatory system.
Last year Dame Judith Hackitt, the former chairman of the Health and Safety Executive, was given the task of reviewing the building safety system and suggesting how it can be improved. This recent consultation is an extension of Dame Judith Hackitt’s findings.
The consultation’s key recommendations are:
- The production of clearer, more accessible building safety standards and guidance;
- The creation of a ‘dutyholder’ regime where architects, engineers, contractors and developers working on a development project are identified as the ‘dutyholders’ and are directly responsible for ensuring that all building regulations are followed and keeping vital safety information about how the building will be designed, built and managed. Dutyholders will also be responsible for the residents’ safety during and after construction; and
- A newly created building safety regulator with the ability to take enforcement action against those ignoring their duties. The regulator would oversee the safety of new and existing buildings and ensures that all safety regulations are taken into account when buildings are constructed.
What does this mean for developers and landlords?
This recent consultation may have further impact on both landlords and developers.
As the consultation is limited to residential buildings over 18 metres in height (6 storeys), developers of lower-rise buildings will not be directly affected. However, if the government’s proposals are implemented developers constructing tower blocks and high-rise buildings above this height will now be held further responsible for the materials and general safety of the building under the new dutyholder regime, particularly after the building is completed.
On the other side of a commercial deal, a purchaser or prospective tenant of the whole or part of a tower block will need to identify the dutyholder(s) and ensure that the building meets the vigorous requirements. This will increase the purchaser’s due diligence and need for technical expertise and so could potentially increase their costs. Although it is not currently proposed that this regime is extended to commercial properties, the requirements will provide a guideline that may influence commercial occupiers seeking safe and well-constructed high rise premises.
One unknown aspect is how a dutyholder’s liability will be affected by alterations carried out by occupiers. To what extent will the dutyholder be liable if the tenant completely alters the flat? It seems likely that the dutyholder will be bound to ensure that the structure of the building is sound as a tenant is not usually permitted to alter the structure of the building, but with potential criminal sanctions should the safety of the building be prejudiced, we may see landlords carrying out regular inspections and imposing even tighter controls on alterations.
What does the future hold?
The implications of the Hackitt review and this consultation on building safety regulations cannot be ignored. An offshoot of the imposition of a dutyholder regime, which will increase the responsibilities of those tasked with ensuring the safety of buildings, may be an increase in professional indemnity insurance premiums which is likely to be passed on to the owner of the development project.
We await publication of the final report once the Government’s consultation period has ended on 31 July 2019.