Cladding roundup – why we must take cladding and fire safety more seriously

26 March 2021 | Investment

Brett Williams, managing director of Principle, says that the new measures were part of the government’s response to the Fire Safety Consultation, coming into force as part of legislation in the Building Safety Bill.

He explains: “It’s crucial that the owners of all buildings take their responsibilities seriously, and this planned legislation shows the government’s commitment to this.”

“These measures will amend the Fire Safety Order and will include a requirement for fire risk assessments to be recorded for each building and improve how fire safety information is handed over throughout the lifetime of a building.”

“Principle welcomes these reforms which follow a major review into fire safety in buildings following the Grenfell Tower fire in London in June 2017.”

The Fire Safety Consultation took place in 2020 to inform government work on improving fire safety, and more than 250 responses were received.

The government now intends to launch a further consultation on personal emergency evacuation plans this spring to seek additional views on implementing the relevant Grenfell Tower Inquiry recommendations.

Williams adds: “It’s imperative that people should not only feel but also be as safe as possible in the buildings where they live, stay or work.

“These new measures will not only improve fire safety and help save lives but will also see the government take firm action against those who fail in their duty to keep people safe.”

Decade-old Liverpool development passes fire safety standards

Alexandra Tower at Liverpool’s trendy Princes Dock reportedly has full A1 EWS1 certification, making it one of the safest developments in the UK despite being over a decade old.

Marketed by Liverpool estate agency Ascend Properties, the development completed in 2007 and is a new-build development of 201 one and two-bedroom apartments.

Its full A1 EWS1 certification has signed it off as being built to the highest safety standards despite being completed over a decade prior to the Grenfell disaster.

This comes as the government recently sought to resolve the UK cladding scandal by pledging £3.5 billion for works to retrofit dangerous cladding with materials that are non-combustible.

House price data from the Land Registry shows that, in 2017 and 2018 and in the wake of Grenfell, the mere possibility of unsafe cladding was an understandable concern for buyers and house price growth for flats fell by 1.6% in London.

The rate of price growth also slowed across the UK as a whole with prices up just 1% compared to 3.8% the previous year. In Liverpool, the average price paid for a flat increased by just 2.5% annually compared to 7.3% the previous year.

This trend continued between 2018 and 2019, with the value of flats falling by a further 0.8% in the UK, and by as much as 4.8% in Liverpool while they sat fairly still in London with an annual increase of just 0.8%.

However, growing awareness of the A1 EWS1 certification and the government’s plans to improve buildings to gain this certification has helped revive the market and buyer demand for flats, reversing the negative trends seen in the wake of the Grenfell disaster.

Developments already meeting these high standards of safety, such as Alexandra Tower, are leading the way and flat prices have regained momentum over the last year, climbing by 5% across the UK, 1.2% in London and a huge 11.4% across Liverpool. 

Ged McPartlin, managing director of Ascend Properties, comments: “We’re seeing a big rise in enquiries for apartments in Liverpool, Manchester, Leeds and the West Midlands with buyers searching for properties specifically on the basis that they already meet the A1 EWS1 criteria.”

“Alexandra Tower is our foremost example of this and we’re receiving interest from predominantly owner-occupiers, not just investors, which is testimony to the reassurance that such safety certifications provide.”

He concludes: “Whilst remediation work is set to take years on existing buildings that currently have below standard cladding, it’s great that developments such as Alexandra Tower are already on the market at the highest possible standard of safety and have been for well over a decade.”

Case study – court amends judgement on combustible cladding case

A recent court judgement has highlighted how the courts are willing to adopt a flexible approach to time bars in combustible cladding cases.

In Martlet Homes Ltd v Mulalley and Co Ltd, the judgement from the UK’s Technology and Construction Court (TCC) amended a claim that the use of combustible cladding was in breach of a design and build contract.

In 2005, Mulalley & Company entered into a design and build contract with Martlet Homes to refurbish its five high-rise towers in Hampshire. The works included the design and installation of external cladding using combustible expanded polystyrene (EPS) insulation boards.

The contract was signed as a deed, applying a 12-year limitation period. The works were then certified practically complete in sections between 2006 and 2008.

However, days before the limitation period was due to expire in two of the five towers, Martlet issued court proceedings against Mulalley for negligence and breach of contract. It alleged a number of defects in the towers’ fire barriers, inadequate fixing of the insulation boards and inadequate repair of the underlying substrate. Martlet claimed damages for the cost of remedial works and fire patrols.

In its defence, Mulalley argued that no loss had been caused because Martlet, as building owner, was required to replace the cladding in any event. Martlet then replied that the EPS cladding installed by Mulalley did not comply with the building regulations.

Mulalley struck out the EPS claim on the grounds that Marlet should have done so in its ‘particulars of claim’ beforehand, making the new claim time-barred. In response, Martlet sought to amend its ‘particulars of claim’ to further plead its EPS case.

The TCC granted permission to amend the ‘particulars of claim’, stating it did not matter whether the limitation period had expired because the new claim arose out of the same facts already in issue.

Barry Hembling, partner of Watson Farley & Williams LLP, the international law firm that advises on energy, transport and real estate matters, comments: “There are sound policy reasons for the more liberal approach being adopted by the courts for time bars in combustible cladding claims.”

“If a building’s owner is unable to recover the costs of replacing unsafe cladding from those responsible for its installation, there is an increased risk that remedial work costs will be passed to residents.”

He explains: “In this scenario, the increased service charge costs would fall on those without the financial ability to pay. Other residents might be left with no alternative but to sell their homes due to family breakdown, old age or infirmity.”

According to Hembling, the ongoing Grenfell Tower public inquiry has allowed everyone to fully understand the facts around the UK cladding scandal. “Given the timescales involved, there is a real risk that by the time the facts become clear, many claims may well be time barred. Should that occur, this could only add to a sense of injustice if those who might otherwise be culpable are found not to be held accountable,” he says.

“This latest judgement confirms the recent trend that while justice could be delayed, it may still be forthcoming.”

This post has originally been featured in Property Investor Today.