Quiz - how well do you understand your lease?
Understand the key things you should know about your lease. If you are a purchaser, this can help make sure your solicitor has covered all of these points and explained them clearly to you.
By Ella Norman – Legal Adviser
In the Budget on 11th March 2020, the Government announced a 1-billion-pound fund, available on a first come, first served basis. The funding was made available for the remediation of unsafe non-ACM cladding systems on residential buildings in England that are 18 metres and over in height. The fund is in addition to the separate funding to remove unsafe ACM cladding systems on High Rise Residential Buildings, identified as a priority for remediation after the Grenfell Tower Fire.
The purpose of the Fund
The purpose of the fund is to make sure residents’ homes are safe. The government expects that building owners remediate unsafe cladding on buildings, without seeking funding from residents or the taxpayer. Where this is not possible the fund is designed to ensure that building owners do not fall back on leaseholders to meet the costs.
A prospectus introducing the fund was released on 26th May 2020. It set out the buildings and non–ACM Cladding Systems, that are eligible for funding [Annex A:]; and invited potential applicants to register expressions of interest.
Registering for and applying to the fund
The registration process opened on 1st June and remained open until 31st July 2020.
Buildings meeting certain technical criteria are then invited to apply to the fund, with full guidance and the process for doing becoming available at the end of July 2020. In the private sector, the full application will be submitted by the responsible entity.
Applicants who have already registered for the fund now have until 30th June 2021 (extended from 31st December 2020) to submit full applications based on tender prices, once invited to do so. The new deadline follows a 6-month extension to the original deadline of 31st December 2020.
To qualify for funding, all projects must start on site by 30th September 2021 ; that is the Applicant must have entered into a signed Works Contract and the Main Contractor must have taken possession of the site and started to deliver the contract by 30th September 2021.
The government has released a step-by-step guide to the Building Safety Fund application process for the remediation of unsafe non-ACM cladding systems.
What can residents do?
A resident should contact the building owner or manager if they believe that they might have unsafe cladding and ask them to confirm what action they are taking.
The registration prospectus sets out the following action that a resident might wish to take:
- Contacting your building owner or managing agent to ask for confirmation that the cladding system on your building is safe. You should ask to see a copy of the most recent fire risk assessment for the building.
- If the cladding on your building is not safe, seek confirmation as to the actions your building owner is taking and how they intend to finance the work. if your building owner cannot meet the costs themselves or intends to charge you for the remediation, you should refer them to this fund.
- If your building owner is not taking action or intending to charge leaseholders for the remediation of a cladding system, you can notify the Ministry of Housing, Communities and Local Government(“ MHCLG”) using the Leaseholder feedback form providing basic details of your building, the owner or managing agent, and the type of cladding you believe is present if known to you.
- If you are concerned about a fire safety risk which your building owner or managing agent is not addressing, you should contact your local fire and rescue service or local authority for advice.
The fund is open to mixed-use residential and commercial developments.
If the funds are fully allocated, applicants to it will be notified that no further funding is available.
What is not covered by the fund?
The fund will not meet the cost of waking watch or other interim safety measures, and is not available for:
- Remediation work on buildings with non-ACM cladding systems in scope that had been committed to, or where work had started on site, prior to 11th March 2020.
- Other non-residential buildings, for example, hotels, hospitals and buildings where there are no residential leaseholders.
- Buildings under 18m in height (allowing for a 30cm tolerance)
State Aid Declaration Form – Leaseholders’ obligations
The applicant for funding is responsible for distributing State Aid Declaration forms to and collecting them from leaseholders who are required to complete them. The applicant is then responsible for uploading completed and signed forms to a portal operated by the Delivery Partners administering the Fund on behalf of the MHCLG.
The State Aid Declaration form should be completed and signed by each owner of a flat or any commercial occupier who falls into the category of an “Undertaking”.
An undertaking is anybody who either owns and lets out property to others or uses the property in the building solely for the purposes of operating a business.
If there are joint leaseholders on the lease, each should complete a separate declaration.
There is a limit of €200,000 euros on the amount of state aid that can be given in any period of three years to someone operating an undertaking from their flat.
The original signed declaration form must be returned to whoever provided them with the form to complete.
Any leaseholders completing and signing a declaration form must keep a copy of it and any other documentation relating to State Aid under the terms of the Building Safety Fund for at least 3 years following the date of the building safety fund grant and is obliged to produce a copy on request by the UK public authorities or the European Commission.
The MHCLG has provided guidance for leaseholders that are Undertakings on completing their State Aid Declaration.