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Property Disputes: Cladding Compensation Claims

Following the tragic events of the Grenfell fire and amendments made to Building Regulations, government recommendations have been made to re-assess external cladding on tower blocks to ascertain whether the cladding complies with the regulations. Who will be responsible for effecting these changes and covering the costs of the same? Whether you are a tenant, landlord or building owner or property manager, our property litigation team can advise you.

Following the tragic events of the Grenfell fire and amendments made to Building Regulations, government recommendations have been made to re-assess external cladding on tower blocks to ascertain whether the cladding complies with the regulations. Who will be responsible for effecting these changes and covering the costs of the same? Whether you are a tenant, landlord or building owner or property manager, our property litigation team can advise you.

What is cladding and what are the changes?

Cladding is a material in the outer layer of a building to improve insulation and energy efficiency and often improve appearance.

Following the events of the fire at Grenfell Tower, there was a surge in investigations and claims involving cladding, which were said to have been a significant factor as to why the fire spread so quickly.

The Building Amendment Regulations 2018 SI 2018/1230 came into force on 21 December 2018 which banned the use of combustible materials in the construction of external walls.

Recommendations have been made to re-assess external cladding on tower blocks to ascertain whether the cladding complies with the Government’s regulations.

Who is responsible for assessing and replacing flammable cladding?

Lease agreements will normally provide for responsibility of the “Common Parts” of a property and responsibility for fire safety in apartment buildings can be imposed on the landlord/freehold proprietor for the building, the Management Company or the leaseholder.

Tenants are required to pay a service charge to their landlords as part of or in addition to the rent to cover the landlord’s costs in complying with obligations under the lease e.g. service, repairs and improvements. The amount a landlord can recover must be for works that were reasonable for the landlord to undertake and completed to a reasonable standard.

Landlords should cary out thorough risk assessments and consider carefully any obligations to repaid and subsequent recovery of these costs from their tenants.

Whether you are a tenant, building owner or property manager, you should seek legal advice as soon as possible.

I am a tenant. How do I make a claim?

A physical inspection of a property will determine if there is cladding and the necessary enquiries can then be made. When purchasing a leasehold property, the Seller and Management Company should provide information in respect of any works that have been undertaken in the last three years in addition to proposed works. This information should also include details of any risk assessments which have been carried out.

You should ensure the necessary enquiries are made when purchasing a property and that any concerns are raised.

You should consider your lease agreement for responsibility for paying for replacement cladding and seek legal advice as soon as possible.

If you feel as you were misinformed or misadvised, you may have a claim against the professional who advised you whether architect, surveyor or solicitor.

I am a building owner, can I claim?

Building owners should investigate and seek advice on any claim against architects and professionals responsible for designing and undertaking the cladding work in their property.

If you feel as you were misinformed or misadvised, you may have a claim against the professional who advised you whether architect, surveyor or solicitor.

Where a lot of buildings will have been built many years ago, you should seek advice as soon as possible to avoid any limitation issues.

Will my insurers cover any costs of repairs?

In  Zagora Management Ltd and others v Zurich Insurance plc and others [2019] EWHC 140 (TCC), leaseholders of two blocks of flats in Manchester became aware of defects in the development. The leaseholders and freeholder commenced a claim against Zurich Insurance plc, the insurer who provided a new home warranty in relation to the flats and Zurich Building Control Services Ltd, providing approved inspector services certifying compliance wit the Building Regulations.

The claim succeeded as the property was found to be seriously defective and required major and expensive repairs falling within the cover afforded by the building warranties issued by Zurich. The claims were limited to the purchase price of the flats pursuant to the maximum liability caps in the warranties.

Complaint about an architect?

Architects are highly trained and regulated by the Royal Institute of British Architects (RIBA). All members at RIBA are mandated to follow the Code of Professional Conduct (with a new code effective from 1 May 2019). Core principles include acting with integrity; keeping the client informed; record keeping; inspection services; building performance and certification.

RIBA have an alternative dispute resolution process including arbitration, adjudication and mediation. However, in order to protect legal rights from expiring, it is vital to seek legal advice at the outset of any dispute first to consider your options before considering making a formal complaint to RIBA.

Who regulates property solicitors and licenced conveyancers?

Licenced conveyancers are specialist legal professionals that have been specifically trained to practice property law. Solicitors can also deal with property transactions.

Legal professionals such as solicitors and barristers are highly trained and rigorously regulated by the Solicitors Regulation Authority (SRA). A high level of trust is placed upon such lawyers by their clients. If a lawyer fails to deliver the service to the standard expected of a reasonable professional in the speciality field of conveyancing, then a client has every right to bring a complaint (and court proceedings) if financial or personal loss is suffered as a result.

Licenced conveyancers are also regulated by the Council for Licenced Conveyancers (CLC), which is the specialist property law regulator. The CLC provides regulation for those conveyancers who do not practice as solicitors, but instead are specialists, who have been trained only in conveyancing. The CLC investigates misconduct, takes disciplinary action and sets training standards for licensed conveyancers.

Complaint about a RICS surveyor or valuer? Incorrect survey report? Failure to identify defects at the property? Failure to identify subsidence issue? Over-valuation of property by valuation expert?

Property experts such as surveyors are highly trained and regulated by the Royal Institution of Chartered Surveyors (RICS). The RICS holds itself out as promoting and enforcing the highest international standards across the built and natural environment.

Conveyancers, if they are legally trained, will be regulated by the Solicitor’s Regulation Authority (SRA).  

In order to bring a complaint against a property expert, then you must prove that the professional fell below the standard of care.

Do I have a professional negligence claim in relation to cladding issues?

If you relied on a professional such as an architect, surveyor or conveyancer to advise you on any potential issues and you feel you have not been given adequate advice or any at all, then you may have a claim for professional negligence.

The following three elements need to be proved to the civil standard of proof on a balance of probabilities i.e. it must be proven that the lawyer’s breach in the duty owed to its’ client, more likely than not caused the client to suffer loss.

1.Demonstrate that the professional owed you a duty of care: the boundary lines between when a tortious duty of care is owed or not owed is subject to tests that are being continuously adapted by the courts. It is safe to say that a duty of care exists where the professional can be shown to have objectively assumed responsibility (and the courts have demonstrated increasing willingness to find that a professional is liable to whomever reasonably relies on their advice). Once a professional accepts instructions and you have signed the client care letter, a contractual duty of care will likely be found within that document.

2. Establish that the professional has breached the duty of care owed to you: proving breach will obviously vary depending on the individual circumstances of the case. A claimant needs to demonstrate that the breach shows that the professional fell below the standards of a reasonably competent property professional. The particular level of experience of the professional (from newly qualified to highly experienced partner) is not relevant- inexperience is no good argument to persuade the court to lower the standard of care. However, if a professional or firm hold themselves out as specialists in an area (for example solicitors specialising in conveyancing), then the court will hold them to standard of reasonably competent specialists of conveyancing law.

3. Prove that the professional’s breach caused loss to you: you must prove both factual and legal causation. The test for factual causation is that “but for” the breach you would not have suffered loss, for example if a limitation date and as a result your claim becomes statute barred and you lose the chance to substantial damages in the substantive claim, factual causation is demonstrable because “but for” the solicitor’s negligence you would still have a claim that was not time-barred and still have a chance to achieving damages. Legal causation must also be proved i.e. the loss must be reasonably foreseeable at the time when the relevant duty was breached.

Instruct Property Litigation Lawyers

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If you are a commercial tenant and wish to obtain advice on your current position, please call our property litigation team on ☎ 02071830529

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