Case Chasers Podcast Episode 4

Ian Quayle recently reconvened with Andrew Butler KC from Tanfield Chambers for another captivating discussion on the Case Chasers podcast by Property Law UK. This time, they delved into the latest updates to the Building Safety Act (BSA), building upon insights they previously shared in “Building Safety Act 2022: A Guide for Property Lawyers” from The Law Society, where they served as general editors. Below is the transcript of their informative conversation. 

Ian Quayle (IQ): Hi everyone and welcome to this podcast. My name is Ian Quayle from IQ Legal Training, and I’m delighted to be talking today to my dear friend, Andrew Butler KC from Tanfield Chambers. Andrew, as ever, lovely to see you and lovely to speak with you. I hope you’re fit and well. 

Andrew Butler KC (ABKC): Likewise, Ian, thanks for having me along.  

IQ: Andrew, first of all, before we start talking about all matters BSA, hey, fantastic news about Tanfield Chambers. Lots of new recruits, lots of exciting names, et cetera. So, you must be really pleased with how things are going at Tanfield.  

ABKC: Yes, thank you. It’s a really good period for us. We had a number of new arrivals towards the end of last year, as you say, and what’s particularly pleasing is the way they dovetail with our existing practice groups. So, we’re well known for our real estate work, and these newcomers give us a real presence in some sort of broader areas of chancery, our private client, our insolvency, as well as enhancing the property offering too. So, they’re exciting times, definitely.  

IQ: Yeah, and the people that I deal with, nice people to deal with, very approachable, which is great. You know, from a transactional lawyer’s perspective, it’s nice to have experts on BSA and other chancery-related matters that are approachable. So, I certainly bang the drum when I’m on the road, as it were, talking to people about if they have problems or need an opinion, to speak to yourself and your colleagues, because certainly you and your clerks are very approachable, very friendly.  

ABKC: Well, that’s great to hear and I have to say as long as I’ve been a member of this set, that’s been a hallmark of the set really and I think one of the things that pleased us about the opportunity with the new arrivals last year, they were all from a set that had a similar approach and so the kind of cultural overlap has been very pleasing, as well as the work overlap. 

IQ: Good, and BSA-related work, it’s interesting, isn’t it? I thought you chaps and you ladies in chambers would be absolutely bombarded with litigation. It seems to me there’s lots of litigation about remediation contracts and dividing up liability relating to remediation, so, spats and scraps between landlords, but there doesn’t seem to be much litigation that, as a conveyancer, I can grab and say, right, that clarifies an issue I’ve got with regard to, say, landlord certificates or leaseholder deeds of certificates. Do you think I’m right on that or not? 

ABKC: Yeah, I think you are. There’s quite a lot going on in the tribunals. There’s obviously quite a lot, there have been one or two quite big cases in the course of 2024 that have been much talked about, and which are going to be the subject of appeals in a couple of months’ time. I do wonder if part of it is that there’s so much in the Building Safety Act that calls for clarification. We maybe just haven’t got the clarification in all the areas we would have liked yet, but we’ve got to remember this Act is only less than three years old, and large swathes of it only came into force much more recently than that. So perhaps it would be too much to expect it all to have worked through the courts and Tribunals at this stage. However, there is a lot of advisory work and my colleagues, and I are getting stuck into that and that’s certainly causing us to focus on one or two corners of the Act that perhaps we haven’t focused on yet today.  

IQ: Yeah, I like that it’s the only case that I’ve seen, or the old Tribunals in there like Lehner on the basis that sort of checklist at the end is really useful, isn’t it? And I say it to all conveyancers, if you’re doing transactional work relating to the BSA, have a look at that, because it sheds quite a lot of light on some of the issues. And the other interesting thing is it’s very supportive of the work that we did with regard to the Law Society book. There’s quite a lot of material in the decision that’s supportive of the stance that you and your colleagues in chambers made in connection with the book.  

ABKC: Yeah, I think Lehner, as you rightly say, contains invaluable guidance for anybody looking at Part Five and Schedule Eight, and actually, the judgment seems to have been drafted sympathetically to practitioners. There’s a sense that the tribunal realised what a terrible, terrible mess the Act is in some ways, and they provided this, this six-stage, 17-question sort of map, if you like, for want of a better word, to enable practitioners to plot their way through Part Five and Schedule Eight. I think the other thing that is notable about Lehner is that it fires a warning shot in the direction of FTTs. The First-Tier Tribunal in that case, as you know, just hadn’t got to grips with Part Five and Schedule Eight. In fact, they’ve gone so far as to discourage the applicant from taking points based on the Building Safety Act at all, and the Tribunal said that was a completely wrong approach. The Upper Tribunal said this was a completely wrong approach. I mean, not only should they not have done it, but actually, it’s incumbent on Tribunals to grapple with these points, whether they’re taken or not. So that puts a heavy onus on the Tribunals and on representatives appearing in front of the Tribunals. But the message is it’s got to be done.  

IQ: Yeah, interesting. Another case I found noteworthy was the Blomfield case, which involved storeys, a rooftop garden, and so on, in the context of a higher-risk building. The issue of storeys was crucial in determining whether it qualified as a higher-risk building. 

ABKC: Yeah, that’s it. I think it was actually just a remediation order case, so the high-risk building question wasn’t directly relevant to the decision that had to be made. However, the Tribunal were concerned that the various reports, particularly the fire reports, had been based on the assumption that the building was not high-risk. They took it upon themselves -this was a First-Tier Tribunal that was very much on the ball -to assess whether it was high-risk. It turned out to be a really interesting borderline case because whether or not it was a high-risk building depended on whether a top storey, specifically a roof terrace, was counted as a storey. There was some government guidance, as you know, which seemed to point in a different direction from what the statute actually says – or at least that’s how the Tribunal interpreted it. 

So, it evolved into not only a fascinating debate about the precise definition of a high-risk building but also a broader discussion about the status of government guidance, and the sheer amount of government guidance. There’s an important takeaway for practitioners here, beyond just the question of higher-risk buildings: the need to exercise caution when relying on government guidance, and the fact that some of it is contradictory to the Act. You shouldn’t rely on it as a substitute for or to the exclusion of the Act. You’ve always got to return to the Act itself, along with the secondary legislation made under it, to find the definitive answer to your question. 

IQ: Yes, and did you see what the government department has done in the guidance? There’s now a note saying they’re aware of that decision and still believe their position is correct. Really interesting. A practitioner pointed it out to me, and I’ve written it down somewhere. Here it is, I’ll read it to you: ‘The Ministry of Housing, Communities and Local Government and the Building Safety Regulator are currently considering the views expressed by the Tribunal in the Blomfield case, that roof gardens should be classified as a storey when determining whether a building meets the height and storey criteria, etc.’ It’s important to note the Tribunal itself acknowledged it wasn’t within its jurisdiction to make that determination. And then they say – and this last bit I like – ‘Until stated otherwise, the sector and regulatory body should continue to refer to existing government guidance.’ So, they’re basically saying, ‘Thanks, Tribunal, that’s interesting, but stick with the guidance until further notice.’ 

We’re sort of stuck between the devil and the deep blue sea. My view is—and I always come back to this – if the spirit of the Act is to protect leaseholders, the fact that leaseholders can access the roof garden means there’s potential vulnerability there. So, should it be considered a storey in the spirit of the Act? But if you look at the Act itself, my reading is that a roof garden in those circumstances wouldn’t qualify as a storey. It’s an interesting one, isn’t it? What do you think? 

ABKC: Well, I find the Tribunal’s reasoning quite persuasive, I mean, it’s all about the 2023 regs, the High-Risk Buildings Prescriptions and Supplementary Provisions regs, and in particular, a provision in those regs 6b, which says that any story which is a rooftop machinery or rooftop plant area or consists exclusively of rooftop machinery or rooftop plant rooms is not to be treated as a story. Now, by implication, the Tribunal said, if there’s something that’s half and half, it’s not exclusively plant or storage, and therefore, it should be treated as a story. And the logic, of course, the point you made a moment ago about the logic of the situation is right. If there are people using it, then in the event of a fire, they’ve got to be rescued, and we all know the slightly weird approach that the Act takes to building height. It’s not bottom to top in the normal course, it’s bottom to the floor of the highest story used by people. Because I think this was the length of ladders, standard equipment on a fire engine, how high the ladder could reach. So, by that logic, it seems to me that the Tribunal is right, and certainly, if I’m giving advice to a client or making a submission in front of a Tribunal, I’m really wanting to draw on the Act and the regulations in preference to the government guidance. I mean, with all due respect, government guidance is drafted by non-lawyers interpreting legislation, and I’m not saying they often get it wrong, of course, that’s not the case, but, I mean, the legislation should take precedence. There’s no doubt about it. 

IQ: I think to an extent that the government department’s marking its own homework, isn’t it? Given that as far as the legislation was concerned, it participated in the creation of the thing in the first place. So yeah.  

ABKC: I think as soon as you start putting some of these concepts in different words to the word used by the Act or the regs, you’re creating a potential for confusion. I know something else that you were keen to touch on that we have to talk about now. This connects to the recommendation in the Grenfell Report that the whole definition of higher-risk buildings be revisited because the authors of the Grenfell Report said look, it’s a bit arbitrary frankly that something over 18 meters or seven stories should be treated so completely differently to something that’s a little bit under that, and they said much more attention should be paid to the nature of the occupiers of the building and the use to which the building is being put than just simple height or number of storeys.  

IQ: Yeah, and that’s really interesting, isn’t it? Because, you know, you’re right, you could have a 40-metre-high building that’s full of youngsters that are able to skip down the stairs and react very quickly. You could have a three-story building that’s full of invalids, in which case, evacuating those with disabilities, etc., is going to be a big issue. The problem with that, of course, is you’ve then got a situation where high-risk or non-high risk is dependent on who’s in occupation, and that could fluctuate. High-risk, non-high risk, do we deregister on the basis that we’ve got loads of fit youngsters? Do we have to test our occupants or our leaseholders as to how quickly they can get down 10 flights? It just becomes crazy, and from a transactional perspective, which is where I’m always sort of driving at, you know, at least we might have certainty. It might be fundamentally wrong as to the test that’s used, but at least, there’s certainty. The counterargument to that, of course, Andrew is, well, who tells us that a building is 18 metres high or seven stories high? What about a situation where a higher-risk building has been registered as a higher-risk business building when it shouldn’t? Or a building hasn’t been registered when it should? It doesn’t seem as if anyone actually checks if someone registers a higher-risk building. Well, is it in fact a higher-risk building? It’s really difficult, isn’t it? Really difficult.  

ABKC: I think you’re right to identify the trade-off between the certainty of a simple definition and the focus on higher-risk buildings. ‘Higher-risk buildings’ is one of the simpler definitions in the Act, though it may feel somewhat arbitrary. There’s a force in the argument that you shouldn’t have a completely different set of rules applying to a building of 17.5 metres to one of 18 metres, but at least people know where they are. If you’re a lawyer advising on the Building Safety Act, one of the challenges is dealing with the endless torrent of really complicated definitions—one leading into another and then another—making it very difficult to provide clear and certain advice. At least with the definition of ‘higher-risk building,’ you could, for the most part, confidently say, ‘This definitely is, and this definitely isn’t.’ However, if the view of the Grenfell Report authors prevails, you’ll end up with another multifactorial definition that, as you say, will be capable of changing over time. A building that might be considered high-risk at one point could later cease to be, and that somehow feels quite unsatisfactory. 

IQ: No. I’m just changing tack slightly. Something else I’ve been encountering a lot of problems with—I’ve had three emails on this just this week—is leaseholder-owned buildings not being relevant buildings. The first issue I come across is an obvious error: leaseholders who are managing the building or have applied for and obtained the right to manage are not owners. But if you collectively enfranchise, you are. If you acquire or own the freehold, you are. I’ve had the same question put to me on four different occasions over recent months: what happens if one leaseholder owns the freehold? Well, I think that means you’re not a relevant building. 

ABKC: Well, the regs are actually fairly straightforward. It’s reg 2 of the 7-1-1 regs, which relates to section 117(3)(c) of the Act. What it says is that the freehold estate is leaseholder-owned where it’s solely owned by tenants in the building, whether through a corporate structure or otherwise. Now, I suppose there might be one or two arguments under the Interpretation Act, where singular and plural are treated as interchangeable, but I think in this context it’s fairly clear that ownership by an individual tenant wouldn’t be enough. On the other hand, if ownership vests in more than one tenant—even if it’s through a limited company owned by tenants—then it’s not going to be a relevant building. 

Of course, this is just one of the exceptions to the definition of a relevant building in section 117. There are others, as you rightly point out, and this is just one of the four listed there. At any rate, I’m not aware of any decision on it yet. It’s ripe for decision, but the definition in reg 2 of those regs is actually reasonably straightforward. 

IQ: Yeah, the interesting thing about that is I had a situation with a block of 100 flats, all leaseholder-owned by one person. My view there was that it completely goes against the spirit of the legislation, doesn’t it? 

ABKC: I would agree. Well, on the other hand, according to the letter of the legislation, if two tenants come together, form a company, and hold the freehold estate, that seems as if it would pretty clearly fall within the definition, even though you might argue it still goes against the spirit of the legislation. So, that’s a question ripe for decision. But as I sit here and look at that definition now, the clear reference to plural tenants suggests to me that ownership by a single tenant might not be sufficient. Yeah, and people should seek advice. 

IQ: Yeah, they should, but in my view, that overrides the Interpretation Act to some extent, doesn’t it? 

ABKC: I haven’t looked at it specifically in the context of the Interpretation Act, and I’d need to be clear about that. It might be a possible argument, but it feels to me as though the context here—where the statutory draftsman has deliberately used the plural—might rule out ownership by a single tenant from that exception. 

IQ: It’s an interesting point. And then, as you just touched on, I’m encountering conveyancers having issues with some of the presumptions around leaseholder deeds of certificate. My view is that it’s not necessary to voluntarily serve a leaseholder deed of certificate on a landlord. However, where the landlord requests a leaseholder deed of certificate, there is an obligation to provide it, as I understand it. 

Then you’ve got this peculiar situation where, if it’s not provided within the eight- or 12-week period, the lease is deemed to be non-qualifying. But I thought that, given how the regulations and the Act prescribe reasonable steps and specified steps for drawing the request to the leaseholder’s attention, you’d expect some form of draconian sanction for failing to provide the certificate within the specified timeframe. 

However, it seems to me – from what I can gather, and I think this comes from Lehner -that the presumption of the lease being non-qualifying is automatically rebutted at any stage if the leaseholder produces a valid leaseholder deed of certificate stating the lease is qualifying. 

ABKC: I believe that’s right. The default position here seems to be that, if in doubt, it usually works against the landlord. If a lease satisfies the first three requirements of section 192 – i.e., it’s a long lease of a single dwelling in a relevant building, the tenant is liable to pay a service charge, and the lease was granted before 14th February 2022 -then it is treated as a qualifying lease unless the landlord has taken all the necessary steps to obtain a certificate, and that certificate has not been provided. 

The way I would approach it is this: it’s probably quite a rare situation where the landlord both follows that regime to the letter and the tenant fails to provide the leaseholder deed of certificate. In such circumstances, the landlord is entitled to treat the lease as non-qualifying. However, I think you’re right in saying that, if at any future point the tenant does provide a valid leaseholder deed of certificate, the lease must then be treated as qualifying. 

This creates only a very small window where the landlord can safely act on the assumption that the lease is non-qualifying. The provisions are very much stacked against landlords, as are the requirements for the landlord certificate, which, as we know, are extremely difficult to produce strictly in accordance with the regulations and within the prescribed deadlines. On my reading, if the landlord doesn’t comply, the presumptions about the application of the Schedule 8 exceptions come into effect, and those presumptions appear to be irreversible. 

IQ: Yeah, fascinating, isn’t it? Andrew, I’m conscious of your time, and I know we’ve overrun, but we could talk all day about the BSA. Two things I want to say as we wrap up and close the session. First, you and your colleagues have a dedicated section on your website focused on BSA-related issues. I check it almost daily because you’re constantly analysing new cases, with your colleagues’ contributing articles and insights. I always recommend that anyone watching or listening should take a look at it. 

Secondly, you and your team are available to provide opinions, and I know you’re doing a lot of work for landlords, leaseholders, associations, and groups. And of course, there are some really interesting cases coming up, aren’t there? In particular, the one in the Court of Appeal that we’re waiting for, is that Hippersley Point? 

ABKC: Yeah, Triathlon Homes and Hippersley Point are heading to the Court of Appeal in March, during a single week when both appeals will be heard. We’re looking forward to some clarification on the many questions raised in those cases – most notably, the issue of retrospectivity regarding the application of Part 5 and Schedule 8. Specifically, whether it applies to service charges incurred prior to the Act coming into force or only prospectively. 

And, of course, in the case of Triathlon Homes, the just and equitable test, which was the subject of a decision by the FTT, will also be under scrutiny. We’ll all be watching that space closely and will post updates on the website as soon as those decisions are released. I think there’s going to be a lot of tribunal activity this year and staying on top of it all is definitely a challenge – but it’s something we’re committed to doing. 

IQ: Fantastic. Andrew, as ever, lovely to talk to you. Thanks very much. 

ABKC: Likewise, Ian. Thanks for having us. Good to see you.  

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Building Safety Act 2022, A guide for property lawyers, 1st edition, can be purchased from The Law Society here. 

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