Addressing the issues surrounding the Building Safety Act 2022

Ian Quayle, CEO of IQ Legal Training and Managing Editor of Property Law UK, dissects the current issues surrounding the Building Safety Act 2022 (BSA, “the Act”) and affected leasehold properties. This comes as June’s edition of Property Law UK – a Building Safety Act special – has been made free for conveyancers to access.

The Building Safety Act 2022 was clearly drafted with good intentions: the promotion of building safety and the protection of leaseholders in connection with the transmission of remediation costs into service charge being two of many aspects of the Act.

However, any hope that the new legislation and accompanying regulations would reactivate the market for flats and apartments in high rise buildings has sadly – but not surprisingly – failed to materialise.

Over recent weeks, I have been in the fortunate (or unfortunate) position to take soundings from practitioners nationwide and those soundings reveal:

• The general consensus from transactional property lawyers is that there are parts of the Building Safety Act that are baffling. They add that the numerous regulations make the situation worse to such an extent that a number of firms and practitioners have decided they cannot make sense of the legislation and so cannot act in transactions to which the legislation could apply.
• When is a landlord certificate or leaseholder deed of certificate required, and what happens if either or both cannot be provided? Who can we rely on to confirm whether a building is 11 metres or five storeys high? How do we know whether the Schedule 8 protection which apparently protects leaseholders applies? What on earth do we do to scope the retainer and what do we include in our report on title? How can we possibly comply with instructions? These are just a few of the common questions posed.
• Practitioners dare not act for fear of negligence claims and concerns that professional indemnity cover will not extend to claims relating to transactions that have a BSA component.

Having spent an inordinate time examining the Act and having the benefit of speaking and working with a number of lawyers – many of whom are far more able than I to dissect and analyse the legislation – and indeed government officers who have to their credit attempted to share their knowledge, I have reached a number of conclusions:

1. Conveyancers can act for sellers or buyers in transactions with a BSA component, but need to carefully scope the retainer when onboarding clients, clearly explain to clients the numerous problems in identifying whether the Act and regulations apply to the lease being sold or purchased, and adopt a cautious approach with regard to reporting on title.
2. Government needs to amend parts of the Act and Regulations to provide clarity quickly and needs to communicate what is being amended and when new legislation and regulations will become law.

I have had the pleasure of working with a number of members of Tanfield Chambers including Andrew Butler KC, Sara Jabbari, Richard Miller, Daniel Dovar, Robert Bowker, James Fieldsend, and Hugh Rowan, all of whom have contributed to a June special BSA edition of Property Law UK which we have been able to offer free of charge to anyone that would like a copy.

To that end, a massive thank you is required to Tanfield Chambers and sponsors of Property Law UK Stewart Title and Dye and Durham together with other contributors to this edition of Property Law, UK Zahrah Aullybocus of Nexa Law and James Brook of Novello Surveyors.