Section 123 Building Safety Act 2022 Remediation orders

(1) The Secretary of State may by regulations make provision for and in connection with remediation.

(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 remedy specified relevant defects in a specified relevant building by a specified time.

(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 “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.

Comes into force on 28 June 2022.

Applies to England and Wales. 

This section and the following, section 124, are two sides of a similar coin.

In this, section 123, we have the power to order a “relevant landlord” to carry out “specified” remedial works.

Section 124 empowers the tribunal to order the payment of a sum of money to a “specified” person.

Again, it’s the pushmipullyu principle:

• Section 123 pushes the relevant landlord to do works
• Section 124 pulls in the money to pay for those works.

Given the wide range of works that may be needed to remedy a defective building, it is perhaps not surprising that section 123 starts by giving the Secretary of State the power to make regulations about remediation orders.

A remediation order may be made by the First-tier Tribunal, but we do not know on what grounds.

Hopefully the Secretary of State will use their powers to make regulations to tell us.

Even more hopefully, the grounds will not be as broad as “if the Tribunal considers it just and equitable to do so”. Beside that wide, loose phrase lie the time, money and energy of many parties to litigation.

You might therefore ask what subsection 123 actually does.

The answer: it defines “remediation order”.

Indeed, more than half of section 123 – subsections 3 to 6 – is taken up with defining phrases used in subsection 2, which is itself a definition.

The technical phrases used in subsection 2 are:

• “Relevant landlord”, which is defined in subsection 3;
• The scope of “landlord”, which is explained in subsection 4;
• “Interested person”, which is defined in subsection 5;
• “Specified”, which is defined in subsection 6.

Subsection 2 contains two further phrases that bear a technical meaning:

• “Relevant defects” are defined in section 120.
• A “relevant building” is defined in section 117.

Reaching first base in an application for a remediation order has the potential to be quite a time-consuming operation.

“Under a lease”

Subsection 3 uses an interesting phrase in connection with landlords. Rather than the single word, “landlord”, we have “landlord under a lease”. It is a phrase that crops up regularly in this part of the Act and in Schedule 8.

Given that “landlord” is not defined in the Act, the insertion of “under a lease” may be intended to avoid importing the wider meaning of landlord from the Landlord and Tenant Act 1985. Under the 1985 Act, section 30* states that a landlord is “any person who has the right to enforce a service charge”. Such a person may be a third party management company; a Residents’ Management Company (an RMC); a Right to Manage Company (an RTM Company) or a Tribunal-appointed manager.

A wider scope

Having said that, subsection 123(4) of the Building Safety Act 2022 brings in parties to tripartite leases.

It extends the meaning of “landlord under a lease” to parties to a lease who are not landlords or tenants. Those parties are normally third-party management companies and RMCs.

The key to that extension lies in the second part of the definition of “relevant landlord” in subsection 3. Not only must be they landlords “under a lease” – they must also be the person who bears the repairing or maintenance responsibility for the “relevant defect”.

Given the prevalence of tripartite leases nowadays, the inclusion of third-party management companies and RMCs in the meaning of “landlord under a lease” is logical. Those management companies tend to be the bodies charged with maintenance and repairs.

On the other hand however,

• those companies generally have no funds on which to draw, save through the service charge, and
• leases do not generally prevent the landlord carrying out works to a building, even if, in principle, a third-party management company bears that liability under the lease. Whether the leaseholder is liable to contribute towards the cost of works carried out by the landlord is of course another question.

The upshot of all of the above is, I think, that a “remediation order” may be made against:

• A landlord under a lease, and
• A third-party management company, including a residents’ management company.

As the Act stands, I do not think that a remediation order can be made against either a Right to Manage Company or a Tribunal-appointed manager, but I suspect that we may have to wait for the point to be decided by the judiciary before we can be sure.

The final point to make about the meaning of “relevant landlord” is that it will also catch landlords who have repairing and maintenance obligations “by virtue of an enactment”. Landlords who are obliged by section 11 of the Landlord and Tenant Act 1985 may therefore also find themselves on the receiving end of a remediation order.

The persons who may apply for a remediation order are, mercifully, pretty clearly described in subsection 5.

I am going to park “any other person prescribed by the regulations”: at the time of writing, we have no regulations and more than enough wordage to deal with, pending the arrival of regulations.

Three of the five grounds of interested persons – the regulator; a local authority and a fire and rescue authority – are defined elsewhere in the Act, but from a leaseholder perspective, the key “interested person” is likely to be “a person with a legal or equitable interest in the relevant building or any part of it”.

Such a person will include:

• A landlord;
• A leaseholder;
• A tenant under an assured tenancy;
• Anyone who holds a property interest in (part of) the building under a trust, whether as trustee or beneficiary;
• A leaseholder who has just completed on the purchase of the lease but is not yet registered at HM Land Registry as the legal title holder;
• A mortgagee – that is, the lender, where the (part of) the building is subject to a mortgage;

I hesitated before including the last of these, but I was comforted by a useful conversation with Tim Polli QC, who shared my view that such a person would probably be treated as beneficial owner for the purposes of the Building Safety Act. Again, we may have to wait for the judiciary to decide the point.

The following are unlikely to be “interested persons”:

• A third-party management company;
• A residents’ management company;
• A Right to Manage company;
• A Tribunal-appointed manager.

As a rule, the above do not have a property interest in a building.

And so, with a sigh of relief, we arrive at the meaning of “specified”.

It’s simple – it means “specified in the order”.

It also means that the order must be drawn up carefully and clearly.

The wording of subsection 7 is the same as section 176C of the Commonhold and Leasehold Reform Act 2002.

Section 176C provides that:

“Any decision of the First-tier Tribunal or Upper Tribunal …, other than a decision ordering the payment of a sum (as to which see section 27 (enforcement) of the Tribunals, Courts and Enforcement Act 2007), is to be enforceable with the permission of a county court in the same way as orders of such a court.”

The procedure for obtaining the permission of the county court is set out in Part 70 of the Civil Procedure Rules.