Freehold and Leasehold Reform Act 2024: amendments in relation to ROs and RCOs under the Building Safety Act 2022 now in force

Introduction

1. The Freehold and Leasehold Reform Act 2024 (“FLRA”) received much media attention for the changes it introduced in relation to leaseholder rights. However, the Act (which was passed just before the prorogation of Parliament in May prior to the General Election) also introduced some important amendments to the Building Safety Act 2022 (“BSA”), which entered into force on 24 July and 31 October 2024. This article addresses the changes which came into force on 31 October 2024 and therefore which have very recently entered into force.
2. Those considering making or currently involved in proceedings concerning either Remediation Orders (“ROs”) or Remediation Contribution Orders (“RCOs”) under the BSA will need to be alive to these changes which apply retrospectively, including to pending applications for ROs and/or RCOs.
3. The effect of the amendments is to expand the scope of the RO and RCO provisions in the BSA. The Act now provides that applicants can seek an RCO to cover the cost of repairs and work done “in connection with” relevant defects and ROs or RCOs to cover the cost of taking “relevant steps” in relation to relevant defects. There is also express provision for RCOs to cover the costs of expert reports and temporary accommodation costs prior to completion of remedial works.

ROs

4. Section 123 BSA (as amended) provides as follows (amendments introduced by the FLRA underlined):

“123 Remediation orders
(1) The Secretary of State may by regulations make provision for and in connection with remediation orders.
(2) A ”remediation order” is an order, made by the First-tier Tribunal on the application of an interested person, requiring a relevant landlord to do one or both of the following by a specified time—.
(a) remedy specified relevant defects in a specified relevant building;
(b) take specified relevant steps in relation to a specified relevant defect in a specified relevant building.
(3) In this section ”relevant landlord” , in relation to a relevant defect in a relevant building, means a landlord under a lease of the building or any part of it who is required, under the lease or by virtue of an enactment, to repair or maintain anything relating to the relevant defect.
(4) In subsection (3) the reference to a landlord under a lease includes any person who is party to the lease otherwise than as landlord or tenant.
(5) In this section ”interested person” , in relation to a relevant building, means—
(a) the regulator (as defined by section 2);
(b) a local authority (as defined by section 30) for the area in which the relevant building is situated,
(c) a fire and rescue authority (as defined by section 30) for the area in which the relevant building is situated,
(d) a person with a legal or equitable interest in the relevant building or any part of it, or
(e) any other person prescribed by the regulations.
(6) In this section—
”relevant building” : see section 117;
”relevant defect” : see section 120;
”relevant steps” : see section 120;
”specified” means specified in the order.
(7) A decision of the First-tier Tribunal or Upper Tribunal made under or in connection with this section (other than one ordering the payment of a sum) is enforceable with the permission of the county court in the same way as an order of that court.
(8) In proceedings for a remediation order, a direction given by the First-tier Tribunal requiring a relevant landlord to provide or produce an expert report is to be regarded as a decision for the purposes of subsection (7).
(9) In subsection (8), ”expert report” means an expert report or survey relating to—
(a) relevant defects, or potential relevant defects, in a relevant building;
(b) relevant steps taken or that might be taken in relation to a relevant defect in a relevant building.”

RCOs

5. Sections 120 and 124 BSA now provide as follows in relation to RCOs (amendments introduced by the FLRA underlined):

“120 Meaning of “relevant defect” and “relevant steps”
(1) This section applies for the purposes of sections 122 to 124 and Schedule 8
(2) ”Relevant defect” , in relation to a building, means a defect as regards the building 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.
(3) In subsection (2) ”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” here means the period of 30 years ending with the time this section comes into force.
(4) In subsection (2) the reference to anything done (or not done) in connection with relevant works includes anything done (or not done) in the provision of professional services in connection with such works.
(4A) ”Relevant steps” , in relation to a relevant defect, means steps which have as their purpose—
(a) preventing or reducing the likelihood of a fire or collapse of the building (or any part of it) occurring as a result of the relevant defect,
(b) reducing the severity of any such incident, or
(c) preventing or reducing harm to people in or about the building that could result from such an incident.
(5) For the purposes of this section—
”building safety risk” , in relation to a building, means 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;
”conversion” means the conversion of the building for use (wholly or partly) for residential purposes;
”relevant landlord or management company” means a landlord under a lease of the building or any part of it or any person who is party to such a lease otherwise than as landlord or tenant.”
“124 Remediation contribution orders
(1) The First-tier Tribunal may, on the application of an interested person, make a remediation contribution order in relation to a relevant building if it considers it just and equitable to do so.
(2) ”Remediation contribution order” , in relation to a relevant building, means an order requiring a specified body corporate or partnership to make payments to a specified person, for the purpose of meeting costs incurred or to be incurred in remedying, or otherwise in connection with, relevant defects (or specified relevant defects) relating to the relevant building .
(2A) The following descriptions of costs, among others, fall within subsection (2)—
(a) costs incurred or to be incurred in taking relevant steps in relation to a relevant defect in the relevant building;
(b) costs incurred or to be incurred in obtaining an expert report relating to the relevant building;
(c) temporary accommodation costs incurred or to be incurred in connection with a decant from the relevant building (or from part of it) that took place or is to take place—
(i) to avoid an imminent threat to life or of personal injury arising from a relevant defect in the building,
(ii) (in the case of a decant from a dwelling) because works relating to the building created or are expected to create circumstances in which those occupying the dwelling cannot reasonably be expected to live, or
(iii) for any other reason connected with relevant defects in the building, or works relating to the building, that is prescribed by regulations made by the Secretary of State
2B) The Secretary of State may make regulations for the purposes of this section specifying descriptions of costs which are, or are not, to be regarded as falling within subsection (2)
(3) A body corporate or partnership may be specified as a person required to make payments only if it is—
(a) a landlord under a lease of the relevant building or any part of it,
(b) a person who was such a landlord at the qualifying time,
(c) a developer in relation to the relevant building, or
(d) a person associated with a person within any of paragraphs (a) to (c).
(4) An order may—
(a) require the making of payments of a specified amount [ ]
(aa) if it does not require the making of payments of a specified amount, determine that a specified body corporate or partnership is liable for the reasonable costs of specified things done or to be done;
(b) require a payment to be made at a specified time, or to be made on demand following the occurrence of a specified event.
(5) In this section—
”associated” : see section 121;
”developer” , in relation to a relevant building, means a person who undertook or commissioned the construction or conversion of the building (or part of the building) with a view to granting or disposing of interests in the building or parts of it;
”expert report” has the meaning given by section 123(9);
”interested person” , in relation to a relevant building, means—
(a) the Secretary of State,
(b) the regulator (as defined by section 2),
(c) a local authority (as defined by section 30) for the area in which the relevant building is situated,
(d) a fire and rescue authority (as defined by section 30) for the area in which the relevant building is situated,
(e) a person with a legal or equitable interest in the relevant building or any part of it, or
(f) any other person prescribed by regulations made by the Secretary of State;
”partnership” has the meaning given by section 121;
”relevant building” : see section 117;
”relevant defect” : see section 120;
”relevant steps” : see section 120;
”specified” means specified in the order
”temporary accommodation costs” , in relation to a decant from a relevant building, means—
(a) the costs of the temporary accommodation, and
(b) other costs resulting from the decant, including removal costs, storage costs and reasonable travel costs;
”works” means works—
(a) to remedy a relevant defect in a relevant building, or
(b) in connection with the taking of relevant steps in relation to such a defect.
(6) The Secretary of State may by regulations provide that this section applies, with or without modifications, in relation to a building that would, but for section 117(3), be a relevant building.”
6. As noted above, section 123(9) defines expert report as follows:
“(9) In subsection (8), ”expert report” means an expert report or survey relating to—
(a) relevant defects, or potential relevant defects, in a relevant building;
(b) relevant steps taken or that might be taken in relation to a relevant defect in a relevant building.”

Transitional provisions

7. The amendments take effect in respect of both pending applications and those yet to be made:

7.1. Section 115(5) FLRA provides as follows in respect of amendments to section 123 BSA:

“(5)The amendments made by this section apply in relation to proceedings for a remediation order as mentioned in section 123 of the BSA 2022 which are pending on the day on which those amendments come into force (as well as proceedings for such an order which are commenced on or after that day).”

7.2. Section 116(7) FLRA provides that the amendments to section 124 BSA take effect as follows:

“(7)The amendments made by this section apply—
(a)in relation to proceedings for a remediation contribution order under section 124 of the BSA 2022 which are pending on the day on which those amendments come into force (as well as proceedings for such an order which are commenced on or after that day);
(b)in relation to costs incurred before as well as after those amendments come into force.”

Written by Helen Dennis

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Helen Dennis

Call 2013

Related practice areas

Construction & Engineering