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This guidance includes information about changes that may require immediate action (please see paragraph 6) or action within one week of this guidance going live (please see paragraph 28).
Introduction
1. Since the leaseholder protections came into force in the summer of 2022, DLUHC has engaged extensively with leaseholders, landlords and others affected, such as lenders and conveyancers, to monitor compliance with, and the operation of, the Building Safety Act (the Act) and the leaseholder protections.
2. The Building Safety (Leaseholder Protections etc.) (England) (Amendment) Regulations 2023 (SI 2023/895) (referred to in this guidance as “the amending regulations”) make amendments to The Building Safety (Leaseholder Protections) (England) Regulations 2022 (SI 2022/711) and The Building Safety (Leaseholder Protections) (Information etc.) (England) Regulations 2022 (SI 2022/859) to ensure they have effect in the way originally intended.
3. The amending regulations are an important step in improving the implementation of the leaseholder protections and provide further detail.
New landlord certificate
4. To pass on any historical safety remediation costs to leaseholders, or to demonstrate to leaseholders why costs cannot be passed on, building owners must complete the landlord certificate. The circumstances where landlords must provide a landlord certificate can be found in the Mandatory information required from leaseholders and building owners guidance.
5. The new regulations replace the existing with a simplified version.
How does this affect landlords?
6. Landlords must use the new landlord certificate form from 5 August 2023 when required to provide a landlord certificate.
Provision of the landlord certificate
7. Part of the purpose of the landlord certificate is to inform leaseholders in relevant buildings whether they are liable for any costs relating to remediation costs.
How does this affect landlords?
8. Landlords must now provide a landlord certificate to all leaseholders in a relevant building, regardless of qualifying lease status. Where a certificate has already been issued, the amending regulations do not require a fresh certificate to be issued.
New requirements and exemptions for evidence requirements
9. The amending regulations make amendments to The Building Safety (Leaseholder Protections) (England) Regulations 2022 (SI 2022/711), so that the current landlord does not need to provide certain evidence where they accept liability for a relevant defect.
10. This reduces the information sharing requirement to that which is essential for the leaseholder and landlords, Resident Management Company (RMC), Right to Manage company (RTM) or named manager to determine liability.
How does this affect landlords?
11. If the landlord on 14 February 2022 was responsible for, or associated with the person responsible for, the relevant defect or did not believe at the time of completing the certificate that there was a relevant defect, and either i) the landlord met the contribution condition or ii) the leaseholder’s lease is not a qualifying lease:
- there is no need to provide any evidence to accompany the certificate
12. If the landlord on 14 February 2022 was responsible for, or associated with the person responsible for, the relevant defect or did not believe at the time of completing the certificate that there was a relevant defect, but the landlord did not meet the contribution condition, the following information must be provided:
- evidence C, D, E, F, I and J of Table 1 below
- no evidence is required in respect of the links with the developer
13. If the landlord on 14 February 2022 was not responsible for, or associated with the person responsible for, the relevant defect, and i) the landlord met the contribution condition or ii) the leaseholder’s lease is not a qualifying lease, the following information must be provided:
- evidence B, F, G and H of Table 1 below
14. If the landlord on 14 February 2022 was responsible for, or associated with the person responsible for, the relevant defect or did not believe at the time of completing the certificate that there was a relevant defect, and the landlord was a private registered provider of social housing, a local authority, a government department (including an arm’s length body), the Crown or an NHS Foundation trust, the following information must be provided:
- evidence F, I and J of Table 1 below
- no evidence is required in respect of the links with the developer
15. If the landlord on 14 February 2022 was not responsible for, or associated with the person responsible for, the relevant defect, and the landlord was a private registered provider of social housing, a local authority, a government department (including an arm’s length body), the Crown or an NHS Foundation trust, the following information must be provided:
- evidence A, B, F, G, H, I and J of Table 1 below
16. If the landlord on 14 February 2022 was not responsible for, or associated with the person responsible for, the relevant defect, did not meet the contribution condition, and the value of the qualifying lease on 14th February 2022 (for example, as set out in a leaseholder deed of certificate) was below £325,000 in Greater London or £175,000 elsewhere in England, the following information must be provided:
- evidence A, B, C, D, E, F, G and H of Table 1 below
17. In all other scenarios, the landlord must provide all ten pieces of evidence in Table 1 below.
18. The current landlord must provide a landlord certificate which meets the prescribed requirements. If not, the liability for the relevant defect will fall to the landlords as if they were responsible for, or were associated with the person responsible for, the relevant defect.
19. RMCs, RTMs, and named managers may then pursue the landlord for amounts owed via civil debt recovery (in the county court) or a remediation contribution order (in the First-tier Tribunal).
New requirements for recovery of costs from landlords
20. Previously, only leaseholders (individually or collectively), enforcement bodies (e.g. the relevant local authority or fire and rescue authority) or other specified interested persons were able to recover remediation amounts from the landlord or developer via a remediation contribution order.
21. The amending regulations refer to ‘L’, where L is the body responsible for managing and repairing the building, be that the landlord, RMC, RTM, or named manager.
22. L must issue a notice to a landlord in order to be able to recover the remediation amount. The regulations set out the information that must be included in the notice, which is the amount to be recovered and information on the appeals process.
23. The new regulations require L to notify any landlord that is associated with the developer of that landlord’s liability to pay for relevant measures in relation to relevant defects.
24. The new regulations provide that an amount payable by a landlord to L as a result of a notice is recoverable as a civil debt by L.
25. The new regulations also provide that RMCs, RTMs and named managers may also apply to the First-tier Tribunal for a remediation contribution order.
New powers for Homes England
26. The new regulations enable Homes England to apply to the First-tier Tribunal for a remediation order or remediation contribution order.
27. Information on remediation orders and remediation contribution orders can be found in the Making sure remediation work is done guidance.
Landlord certificate timings
28. The new regulations require the current landlord to provide the RMC, RTM or named manager with a copy of the landlord certificate and leaseholder deed of certificate within one week of completion or receipt.
29. Where the current landlord fails to comply, the regulations provide that costs cannot be passed on to leaseholders.
30. Where the landlord becomes aware of a new leaseholder deed of certificate, the landlord must provide an updated landlord certificate within four weeks.
New opportunities for landlords to extend appeal deadline
31. The new regulations provide that a landlord may apply for an extension to the appeal time limit by 30 days with the permission of the First-tier Tribunal, to enable out-of-court engagement.
Table 1. Information and evidence required to complete a landlord’s certificate
A: The percentage of the storeys in the relevant building for which each landlord or superior landlord was the landlord on 14 February 2022
(Regulation 6(3)(a) of SI 2022/711 as replaced by regulation 11(4) of the amending regulations)
B: Where a landlord or superior landlord was part of a landlord group on 14 February 2022, details of the corporate structure of that landlord group including:
- the names of all the directors of each company in that group and directors of each corporate trustee, including in each case nominee and shadow directors or any person occupying the position of director by whatever name called
- the name of any other person who has the right to exercise or does exercise significant control or influence directly or indirectly over the group
- details of the type of trust if any, the law to which it is subject and where it is tax resident; and
- in relation to trusts with an interest in the shares of any company comprised in the group, details of the economic settlor, the named beneficiaries or class of beneficiaries and protector and any other person who has the right to exercise or does exercise significant influence or control directly or indirectly over the trust
(Regulation 6(3)(b) of SI 2022/711 as replaced by regulation 11(4) of the amending regulations)
C: Where the landlord under the lease on 14 February 2022 was part of a landlord group at that time:
- details of the corporate structure of the group, setting out:
a. the companies which make up the landlord group
b. the beneficial owner of each company in the group, and
c. if the beneficial owner of the group or any company comprised in the group is, or includes, a trust foundation or arrangement of a similar character, details of the trust and the trustees
- the name of any other person who has the right to exercise or does exercise significant control or influence directly or indirectly over the group
- details of the type of trust if any, the law to which it is subject and where it is tax resident; and
- in relation to trusts with an interest in the shares of any company comprised in the group:
a. details of the economic settlor
b. the named beneficiaries or class of beneficiaries and protector, and
c. any other person who has the right to exercise or does exercise significant influence or control directly or indirectly over the trust
(Regulation 6(3)(c) of SI 2022/711 as replaced by regulation 11(4) of the amending regulations)
D: The set of company accounts for the landlord under the lease on 14 February 2022, in accordance with regulation 5 of SI 2022/711, and, where the relevant landlord is part of a landlord group, for each company in that group
(Regulation 6(4)(a) of SI 2022/711)
E: A statement from a chartered accountant or finance director of the landlord company:
- setting out the net worth of the landlord under the lease on 14 February 2022 and, where the relevant landlord is part of a landlord group, of each company in that group
- confirming the net worth is calculated in accordance with regulation 5 of SI 2022/711 and paragraph 3 of Schedule 8 to the Building Safety Act 2022 (the “net worth calculation”)
- confirming the net worth calculations accurately represent the net worth of the landlord (and, where the relevant landlord is part of a landlord group, of each of the companies in that group)
(Regulation 6(4)(b) of SI 2022/711)
F: Documents or receipts that demonstrate that the relevant building was constructed or converted before the relevant period (i.e. before 28 June 1992) and details of any relevant works which were carried out in the relevant period
(Regulation 6(4)(c) of SI 2022/711)
G: Evidence that the person who undertook works relating to the relevant defect or commissioned those works was not, or was not associated with, the landlord or superior landlord on 14 February 2022 together with confirmation of the identity of the person who did undertake such work
(Regulation 6(4)(d)(i) of SI 2022/711)
H: Where those works were commissioned or undertaken by a joint venture, proof the landlord or superior landlord on 14 February 2022 was not party to that joint venture, together with details of the persons who were parties to the joint venture
(Regulation 6(4)(d)(ii) of SI 2022/711)
I: Details of any relevant defects and any relevant measures taken in relation to those relevant defects since 28 June 2017
(Regulation 6(4)(e) of SI 2022/711 as amended by regulation 11(5)(a) of the amending regulations)
J: Details of any costs paid or due to be paid in relation to any relevant measures taken in relation to any relevant defects in the relevant building since 28 June 2017, including:
- the total sum of any such costs
- details of the number of flats between which the costs should be divided; and
- the leaseholder’s maximum remaining liability
(Regulation 6(4)(f) of SI 2022/711 as amended by regulation 11(5)(b) of the amending regulations)
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