Charis Beverton, Senior Associate in the Construction team at law firm Winckworth Sherwood, discusses high-rise buildings and the materials used in them.
It has been determined that the kind of cladding used at Grenfell Tower (Aluminium Composite Material with unmodified polyethylene filler ‘ACM category 3’) was not and would never have been compliant with existing Building Regulations. The expert recommendation, supported by the Government, is that all ACM category 3 cladding on buildings over 18m must be removed and replaced.
Views differ on whether other types of cladding with unmodified polyethylene filler are also unsafe and must be removed. It is a matter for building owners and managers, guided by experts, to determine whether these types of cladding should be removed and replaced. It is likely that at least ACM category 3 cladding will be banned from use in the near future and therefore, at least as far as that type of cladding is concerned, the next step is likely to be removal from the market. (The Rt Hon James Brokenshire MP, Secretary of State for Housing, Communities and Local Government, announced a consultation on banning the use of combustible materials on the external walls of high-rise residential buildings in June, which closed on 14th August. The Welsh Government launched its consultation in July, which closes in September.)
It is less likely, in light of the Hackitt report, that Building Regulations themselves will be entirely repealed or replaced. Instead, Dame Judith Hackitt recommends a systemic change to the way construction parties, building owners, landlords and managers demonstrate compliance with Building Regulations across the lifespan of a building.
On 16th May, the Government announced it would fully fund the removal and replacement of unsafe cladding by councils and housing associations, estimated at £400m. Whilst the commitment is to fully fund, it is likely the Government will be asking owners, landlords or managers to continue to pursue others for costs. In other words, it is likely that owners will have to demonstrate that they are taking reasonable steps to recover their costs where possible, before the Government allocates the remaining funding.
Contractual claims
Most construction contracts require the contractor or consultant to:
- (a) Comply with all relevant statutory requirements including Building Regulations
- (b) Comply with good industry practice
- (c) Carry out the work with all due care and skill
- (d) Ensure new-builds comply with NHBC or equivalent NHBC Technical Requirements
- (e) Comply with any applicable manufacturer’s guidance on use/installation
In addition, there is usually a prohibition against the use of ‘deleterious materials’. If cladding has been installed in breach of any of the above there will be a contractual liability for whichever contracting party took the risk of compliance. It will be for the relevant constructing party to show that it was not in breach of contract and/or that approval by a building inspector did not break the chain of causation reducing or eliminating its liability.
Approval?
If the cladding was inspected and approved but should not have been, the inspector may have breached its duty of care. In these circumstances it may be possible to bring a contractual or tortuous claim against the inspector or surveyor alleging that it failed to identify the deleterious material or that it ought to have realised the material was deleterious.
Leaseholders
In a recent housing case, a First Tier Tribunal decided the costs of replacing the cladding were recoverable from the leaseholders under the terms of the lease. However, the wording in the lease did have a caveat, namely that the freeholder could recover: ‘reasonable expenses including rectifying or making good any inherent structural defect in the Building(s) or any part of the Development.’
The FTT thought the difficulty with the caveat was judging how far a manager should go in pursuing insurance and/or third party claims before seeking to recover against tenants. This remains an open question, particularly in light of the Government announcements on funding and political considerations around cladding.
