Alex Barker, Managing Associate, Mishcon de Reya
Welcome to our Property Litigation Watch podcast, the first in a two part series looking at cladding and building safety. My name is Alex Barker and I’m a Managing Associate in the Construction Litigation Group at Mishcon de Reya. I’m joined today by Kizzy Augustin, a Partner in our Litigation Department, specialising in Health and Safety prosecutions. In this first podcast we will discuss the historical context leading up to the introduction of the Building Safety Act 2022, what it aims to achieve and what the new regulatory regime encompasses. Kizzy, to kick things off, perhaps you can set the scene.
Kizzy Augustin, Partner, Mishcon de Reya
Thanks Alex. Well, I think if you haven’t been underneath a rock for the last five years, most people will be aware of the Grenfell fire and I’m sure it’s had various impacts on different people in the UK. Certainly, for those who design, construct and build buildings have certainly been aware of some of the changes that are coming in and us, in the legal profession, have also kept our eyes on what the law was going to be and what regulations were coming in. Back in I would say 2018, Judith Hackitt, who was tasked with looking at our regulatory regime, published a document called the Building a Safer Future Review, which was a holistic review of our UK building regulations and fire safety legislation that we had following the fire and it was said that because our regulatory regime was not fit for purpose, there should be a whole building approach to fire safety and building safety which meant a catastrophic but systemic change from all the way through the lifetime or lifecycle of a building. So where we started actually was from a fire safety perspective and then moved on to the wider building safety regime. For fire safety, in brief, it was really about our existing legislation and whether we could look at that and see if that was being utilised properly, so we rely very much on legislation called The Regulatory Reform Fire Safety Order, which lots of us who are familiar with fire safety would use but there was some confusion as to whether or not we understood who was accountable and I’m probably going to talk about accountability quite a lot today with you Alex but there was some confusion about who would be responsible for fire safety in a building and who should be held accountable, so a lot of the reviews that were going on post-Grenfell were about who do we point to in terms of accountability and the Building a Safer Future consultation was very similar. We had a lot of things already in place, so obviously we had the public inquiry, which is still ongoing, we had this independent review from Judith Hackitt, we already started to look at things like obvious building safety risks such as cladding and again, no doubt we can talk about that in a bit more detail but it was looking at the safety of a building and whether or not the type of cladding that was used should be removed and what immediate safety measures should be in place. So, essentially what the Government wanted to do with the new building safety legislation was to look at clearer responsibilities for those who are building buildings or managing buildings or occupying buildings or designing buildings. So it’s at all, all levels of the supply chain but it was also looking at having a stronger voice within our regulatory system, having more communication with residents and tenants, having a better oversight by the regulator and actually, just having tougher sanctions and enforcement if it goes wrong, if things go wrong. So I think that’s where building safety came alive and we had the Building Safety Act becoming born.
Alex Barker, Managing Associate, Mishcon de Reya
Yeah, that’s great, that’s a really great overview. So the Act has received Royal Assent now, that happened on the 28th of April 2022 but I think it’s fair to say that many of its provisions are not yet in force and actually, a number of us in the legal world and more generally in the construction industry, are still trying to work out exactly what the impact is going to be of a lot of these changes, you know, every often, and it happens all the time with other pieces of legislation, you know, a mechanism is set out in law but it how it actually sort of unfolds in practice can sometimes be quite different, so it will be interesting to see how some of these provisions actually play out in reality. I think it’s useful to summarise really what the Act is trying to do and from my point of view, it’s always been trying to tackle two particular evils, twin evils if you like. So, the first is obviously fire safety in high-rise buildings and you mentioned obviously the Grenfell Tower tragedy and the Hackitt review and everything that followed from that. And the second is what’s becoming known as the cladding crisis and by the cladding crisis, I mean what a lot of you will have seen in the media, which is stories of leaseholders in residential buildings who have found themselves in a situation where the cladding on their development has been deemed to be unsafe and they are being handed these enormous bills via their service charge, that they are technically liable to pay in order to remediate the defective cladding and obviously this is something that man of these leaseholders would not have had in mind when they actually purchased the property. More generally, the Act is trying to institute a new regulatory regime for building safety. It’s worth mentioning just briefly, in terms of applicability so, the new regime, the new regulatory regime set up by the Act will apply to those residential buildings that are deemed higher risk and higher risk is defined in the Act and it’s broadly those buildings that are greater than 18 metres in height or more than six stories tall, so those are the sort of higher risk buildings that we are talking about although there are also legislative provisions that apply more generally and to other buildings that we can come onto as well.
So, what does the new regulatory regime mean? Well, there’s a number of changes that are being instituted and frankly far too many for us to discuss in a relatively brief podcast but just to take three of the most significant so, there’s going to be this new body created, The Building Safety Regulator, which is going to be the kind of overarching body, new body responsible for building safety in high risk buildings but it’s going to be a register of inspectors and building control approvers. A number of the listeners will be familiar with the building control function, as it operates currently and as it’s operated before the Act and essentially, building control is a function that’s either undertaken by local authorities or otherwise by private providers who effectively step into the shoes of local authorities and at the end of a development, sign off that the building is compliant with the applicable building regulations. Now, this part of the chain if you like has sort of been identified as a bit of a weakness in our system. A number of people, a number of lay people certainly, would expect that a building having received this building control sign off, could be and should be deemed to be safe and certainly not to be combustible or dangerous from a safety fire point of view and many people are surprised to find that that’s not necessarily the case, that there a number of these buildings, Grenfell Tower included, that did receive building control sign off and obviously were later discovered to have had very serious fire safety defects that presented a danger to life and tragically, in the case of Grenfell, caused a great loss of life. So this is identified as a weakness in the chain and what the Building Safety Act is trying to do there, is to actually increase the compliance hurdles that need to be jumped over in order to get onto this register of building control approval so, as I understand it, there’s going to be more training required, more testing of competence so, the idea being, you will have a higher quality building control function. Thirdly, there’s going to be a national regulator of products. When we talk about products, we’re talking about some of the elements that have received the most media attention, for example in the Grenfell Inquiry, a lot of the talk around that inquiry was focussed on the manufacturers of the combustible insulation products and combustible cladding products that have been deemed to be unsafe and so the idea is that this national regulator is going to be much tougher and much more proactive in identifying dangerous products and is going to be very active in removing them from the market, having identified those unsafe products.
Kizzy, I think you were going to talk a little bit about the meaning of duty holder status and perhaps some of the differences between corporate and individual responsibility.
Kizzy Augustin, Partner, Mishcon de Reya
Yes, I mean I just think it’s really interesting looking at all of the different parts of this Act and you talked a bit about inspectors and building control approvers. I think this is actually the first time we are seeing an act that is so extensive that it extends to the checkers checking the checkers, which is brilliant and I know, certainly through the building industry, they’re very pleased that it’s not only those at the front face who are building the buildings and developing the buildings and occupying those buildings that are coming under criticism and the fact that the Government has decided to apply this new regulatory regime to fire safety, structural integrity, looking at higher risk buildings, and that was a bit of an issue for a while, the idea of who would be responsible for all of this became almost untenable because we weren’t sure what we meant by higher risk buildings. Now I think we’ve got it fairly clear that we’re looking at, as you say, those buildings that are least 18 metres, at least seven stories and again, what’s widened it, is this stipulation that it should be a building that has two or more residential units, so that’s capturing a much wider range of buildings. We were worried that it wouldn’t capture student accommodation or mixed use buildings, it now does, than simply looking at those higher-rise residential tower blocks like Grenfell. So, I think at some point we are going to look at people being responsible for additional buildings, care homes, hospitals, but perhaps only for certain elements like the design and the construction of those buildings but I think eventually it’s going to apply to a lot more buildings than we cater for now under the Act. But one of the things, as I did mention to you offline, was looking at duty holder status and who are these people that we are saying are responsible for compliance with building safety? And I harbour back to our existing Health and Safety regime so, a lot of people are thinking this is brand new legislation, it’s very onerous, how do we manage this? This is all very new and wonderful and we really don’t know how to handle it but it think what people who are involved in the design and the construction and occupation of buildings need to think about is, we have a lot of this already in our Health and Safety regime so, for example, under the Health and Safety at Work Act an employer, an owner, an occupier or anyone who has to any extent control of a building by virtue of contract or a tenancy, with any mention or responsibility for safety, maintenance and repair could be a responsible person or a duty holder under the Health and Safety legislation that we have. Same with fire safety. They call it ‘responsible person’ under fire safety but again, it’s looking at those that own the building that have control over the building, those are the duty holders we are worried about and that’s where it comes into play about looking at companies versus individuals. Companies tend to be at the forefront of prosecutions when it comes to developers or even contractors but that doesn’t mean that it only is companies. There are specific duties that are owed by certain individuals within the supply chain who are normally at the senior end, so I am thinking here directors and managers within an organisation, who have specific accountability for making sure that they are addressing and mitigating any safety risks, whether that’s safety in response to activities that are going on within the building or with regards to building safety in a wider context. So they do look at specific individuals and that’s where I worry because companies, the worst that’s going to happen to you really, is a fine, there might be some other things which we may talk about later but the worst that’s going to happen is a financial penalty. The worst thing that can happen to a senior individual is not only disqualification from being a director but also imprisonment and that, that’s where I start to think, that’s what keeps me awake at night and that’s where I want to advise companies and those senior individuals about their responsibilities. So, look at fire safety and fire safety tells us, now that we have this new legislation, one’s it’s come into force, we will be looking at the elements of what a duty holder has to do in respect of risk assessments for their buildings, we now know that it’s clarified and includes external facades like cladding, it includes walls, it includes insulation, it includes windows, it includes fire doors that separate the residential part and the common parts of a building and it also includes the common parts, the stairways, the hallways, the communal areas, those are the things that need to have the risks assessed and mitigated in respect of the people that may use that building.
What the Building Safety Act does though, it looks very specifically at additional duty holders. So, it looks at those who commission building work, those who participate in the design and the construction process and those who occupy the building, all having some level of responsibility at managing safety within the building and if there’s some failure to comply I think currently and before this Act came into force, there was a lot of criticism that the system we had fell short at holding all of those people, throughout the lifecycle of the building, accountable and having a stake in the project, so that included the overarching client, it included designers and it included contractors. I think what the Government want to do is to use their powers within this new Building Safety Act to make new regulations that place specific duties those that procure, plan, manage and undertake building works. So, what we have seen, and it’s all very vague, as you said at the beginning, we’ve got this act in but the regulation, the secondary legislation isn’t in yet to tell us how to comply, we know we have to comply and we know what we have to comply with but we don’t necessarily know how we do it but we know who the duty holders are, so the existing duty holders that will have additional responsibilities are the likes of client, principal designer, designers, principal contractors and contractors. I’ll come back to that in a minute but we also have a new role of an accountable person for residential high-rise buildings, which hence is the reason why we talk a lot about accountability and that is the person or organisation who has responsibility for the building. It might be the person or organisation who maintains the common parts of the building, it’s usually a business but it can be an individual, as I said, and I just say think back to the existing legislation and look at what a responsible person is there, think about the appointments of competent persons, appointed persons, it all points to us moving away from the protection of being in a company and looking at digging down and finding out who is responsible. So, there are various things that this accountable person will have to do, including preventing building safety risks happening, including the spread of fire or structural failure and reducing the seriousness or mitigating the seriousness of an incident if one happens. Now, we can go through all of that and I think all those… there’s also the additional responsibility to prepare a safety case report for the building, which demonstrates and illustrates you have assessed all of the risks and you’ve taken all reasonable steps to prevent them and control them, all of that is then given to a building safety regulator. So, all of that sounds brand new and it sounds extremely onerous. Some people might think this sounds very familiar, we’ve got all of these duty holders, we’ve heard for them before, why do we now have this in the Building Safety Act? Well, we do and it is very familiar and we hear very familiar phrases like the clients and the designers and the contractors have to plan, manage and monitor work in a way that secures the safety of the people that are involved in activities with that building, we hear a lot about collaboration and communication within the construction world and we also hear about competence of these people and the skills, knowledge and experience pointing towards them being competent enough to carry out the works that they’ve been instructed to do. So, it’s all there in the construction, design and management regulations, so we’ve heard all of this before, why do we now have this in the Building Safety Act? Well, it’s suggested that the regulations that will follow from this Act will have additional, more onerous building safety duties on those duty holders. So, rather than being concerned with the ongoing safety of a building while it’s in occupation or it's being used, we’re much more concerned about the start of this building, even before we start picking up bricks and putting this together, it’s very much before it comes into creation, we need to start thinking about duties and how we meet that to ensure that we don’t have another, another Grenfell again. Speaking of duty holders still, we are looking at a new regulator as well, so one of the things that concerned me about having all of these onerous responsibilities which extend to having an eye on the golden thread of information that’s going to be stored electronically at different parts of the lifecycle of the building, is that we have this new regulator, building safety regulator, who is from our existing Health and Safety Executive, they are responsible for enforcing new legislation, there are tougher sanctions for any wrongdoers and they will be overseeing the safety and performance of buildings and hopefully assisting in bringing more competency to the industry, not only from those that carry out the work but for those who monitor on behalf of the Local Authority. So, there’s a lot of power in this new regulator and I do say, not some very, not very nice things about regulators because they are often prosecuting my clients but, you know, not only do duty holders have to think about the Health and Safety Executive and the Health and Safety duties proper that we were used to, you’ve got to think about the local authorities and the potential breaches of building regulations and you now have to think about this building safety regulator who can, you know, cast their eye over potential failures and hit you pretty hard when it comes to non-compliance. Duty holders need to be aware of when these duties come in and we might talk about that towards the end but there are essentially three gateways as to when these duties are going to come in, when you’ve got to have the information available electronically, when you have to plan, manage and monitor effectively, when you have to collaborate and communicate. So, there’s at the planning stage, which is already in force and I think people who are involved in the planning of buildings or development of buildings should be aware of those responsibilities now, be doing that now because it’s enforced but there’s also two other gateways. The stage where you are just about to carry out construction, building works, where you do have a responsibility to again assess the risks and then at completion stage, the final certification stage. Those parts are not enforced yet but they will be in around about eighteen months so, I think one of the biggest things for duty holders now, is to be on the front foot and start understanding what those responsibilities are how they can meet them and that’s something that I think us as lawyers can certainly help with. Lots of clients have come to me and asked specifically about cladding because of the Inquiry and how it important it’s been so I think one of the biggest things that will come out of the golden thread of information and how we address those risks, has been how do we deal with those cladding issues? How do we manage cladding and I think that’s something that you’ve certainly have got individual experience with.
Alex Barker, Managing Associate, Mishcon de Reya
Thanks, Kizzy. That feels like a good place to end the first part of this podcast series. Thanks to you and our listeners for joining us today. If anyone has any queries, you can find our details on our website www.mishcon.com. Please do join us for our second podcast in which we will look in more detail at the cladding crisis and new claims created by the Building Safety Act.