Building Safety Bill (Thirteenth sitting)

Shaun Bailey Excerpts

Thursday 21st October 2021 Public Bill Committees

In the clause, we are attempting to change the Landlord and Tenant Act 1985 to allow leaseholders, under regulations, to ask their landlord to demonstrate that they have taken all reasonable steps to find means of paying for mediation before asking the leaseholders for the money. “Reasonable steps” could be: going back to the original builder; checking warranties; or—in the instance that the hon. Member for Weaver Vale raised—asking for grant funding through the various mechanisms that have been made available. If the landlord cannot reasonably show that they have done those things, the leaseholders can seek redress. It will be for the first-tier tribunal to determine whether those reasonable steps have been taken. There is plenty of case law to that effect. As we develop the regulations through secondary legislation, we will have a mind to exactly how those terms are defined.

[Shaun Bailey (West Bromwich West) (Con)]

Will statutory guidance be issued to landlords on what constitutes “reasonable steps”? If not, what engagement work will the Department do to ensure that landlords properly understand their regulatory duties under the clause?

[Christopher Pincher]

Yes, we will produce statutory guidance, and will consult on it. We will certainly make sure that we consult not only landlords but leaseholders on the guidance, so that leaseholders have input on what constitutes “reasonable steps”. I appreciate that not all leaseholders are legally savvy, so we will make that guidance as plain as possible, to allow them as much power as possible to seek redress when they need to.

--- Later in debate ---

[Christopher Pincher]

I am grateful to the hon. Members for Weaver Vale, for Brentford and Isleworth and for Luton South for the points that they have raised, and I appreciate that this is an important matter. We are mindful of the challenges faced by leaseholders who are specifically affected by the consequences of the Grenfell tragedy, and I hope that when I have spoken, the hon. Member for Weaver Vale will feel able to withdraw the amendment.

The Defective Premises Act 1972 applies not simply to the tall buildings that we are addressing primarily through the Building Safety Bill, but to all buildings. This clause extends the limitation period of the 1972 Act, and under section 38 of the Building Act 1984, from six to 15 years. That is a highly unusual retrospective change, which we believe will provide a legal route to redress that previously would not have been possible for hundreds of buildings, benefiting thousands of leaseholders.

Limitation periods serve several important purposes. They give legal and financial security and certainty; they protect defendants from stale claims, which may be difficult to counter—that is important, too, and we must remember that we are talking about all buildings covered by the Defective Premises Act—and they prevent injustice that may arise from the courts being required to decide on past events on the basis of evidence that may have become unreliable because of the passage of time.

Various limitation periods are set in the Limitation Act 1980 for different types of civil claim, of which this would be one. They range from 12 months for defamation or late payment of insurance claims, to six years for claims relating to some types of contracts, and to 15 years for cases involving negligence. That is where this type of case sits.

[Shaun Bailey]

My right hon. Friend will also be aware that it is possible, in the course of litigation, to make an application for those periods to be disregarded in the event that it can be proven to the tribunal that there are circumstances that make it possible to do so. Notwithstanding the conversations that we have had in Committee on the cost of litigation, does he agree that there are avenues by which that limitation period can, in extreme circumstances, be extended?

[Christopher Pincher]

I believe that my hon. Friend is correct in terms of the Limitation Act 1980, rather than the Building Safety Bill.

--- Later in debate ---

[Eddie Hughes]

Regardless of where in the UK people live, it is important that they have access to the redress that we have set out in the Bill. Discussions are ongoing with the devolved nations, because housing is a devolved matter and so it is for them to determine. Those negotiations seem to be going well, and the feeling seems to be warm, so we may have to return to the matter at a later stage of proceedings on the Bill.

The arrangements are flexible to ensure that the best provider can establish and maintain the service. The scheme will be free for homebuyers and is intended to be funded by fees that are paid by the scheme’s members. However, should it be necessary, the clause provides the power to give financial assistance to a person for the establishment and maintenance of the scheme.

[Shaun Bailey]

Will my hon. Friend confirm that the provisions will allow the new ombudsman scheme to work effectively with other ombudsmen and redress schemes to maximise its impact for affected residents?

[Eddie Hughes]

Schedule 8 allows the scheme to include provision about a person exercising functions under the new homes ombudsman scheme, and it allows them to do so jointly with persons exercising functions from other redress schemes. It is important that we make it possible to work collaboratively. That may include the making of joint determinations by the new homes ombudsman and an independent person making determinations under another redress scheme. We are considering whether amendments may be required further to facilitate joint determinations and other forms of co-operation between the new homes ombudsman and other ombudsmen or redress schemes. I thank my hon. Friend for that helpful intervention, and it is something we are considering.

Clause 128 relates to the conditions that the new homes ombudsman scheme must meet under clause 127, and it sets out who can make a complaint to the scheme. The clause requires the scheme to be open to all developers to join as members so that qualifying complainants can escalate complaints about the scheme’s members. A qualifying complainant is a person who, at the time of the complaint, is a relevant owner of a new build home in England. The scheme is given the flexibility to set out other persons who can complain about the scheme’s members.

Schedule 8 details the other provisions that the scheme must or may include. This includes provision on which matters may be complained about; how complaints are to be made, investigated, determined and enforced; and complaints about the scheme itself. The scheme must also contain certain provisions required by schedule 8, such as the procedure for developers to become and remain members of the scheme.

To avoid duplication, the scheme may provide that the ombudsman will not be required to investigate and determine complaints that are dealt with under another redress scheme, or complaints that are subject to legal proceedings. The scheme may make provision about working with another redress scheme.

The scheme will require developers to provide complainants with redress if a complaint is well founded. This includes the ombudsman requiring the scheme members to provide compensation, make an apology, provide an explanation or take such other action in the interests of the complainant as the new homes ombudsman may specify. The scheme may also include provision about how the ombudsman’s determination will be enforced. This may include provision for the ombudsman to request a member to take action and, where a developer does not meet its requirements, the scheme may as a last resort include the expulsion of a member from the scheme. In such cases, provision must be made for how they can then rejoin the scheme.