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Effects of the Building Safety Act 2022

The Building Safety Act 2022 is the Government's response to, primarily, cladding safety issues publicised most evocatively by the Grenfell Tower tragedy. The first instalments of the bill predominantly focused on enhancing safety measures in the design and construction of new high-rise buildings. However, the bill developed to include a legislative framework for the entire lifecycle of the built environment, from the pre-construction planning stage through to post-construction, occupation, and property management stages.

The Act also introduces new regulatory bodies to oversee the construction industry. The Building Safety Regulator (BSR) will oversee safety and performance, the National Construction Products Regulator (NRCP) will govern more effective market surveillance and enforcement in the sector, and the New Homes Ombudsman Scheme will allow relevant owners of new-build homes to escalate complaints.

One of the most radical changes in force since the 28th June 2022 is the extension of limitation periods for claims involving dwellings unfit for habitation. Previously, claims under section 1 of the Defective Premises Act 1972 had a limitation period of six years following the completion of works, or the completion of any subsequent rectification works (either being when the cause of action accrued), but that period has now been increased to 15 years for claims accruing after 28 June 2022. Where the defective works were completed before that date, the limitation period is retrospectively extended to 30 years. With this reform comes the concerning result that claims previously considered out of time may now still be brought.

For instance, property work completed, defectively, in 2010 would normally have been statute barred by 2016, but as the cause of action accrued before 28 June 2022, the BSA now provides (via amendments to the Limitation Act 1980) the potential for claims until 2040. This can be used by tenants to bring a claim for a dwelling that is considered liable to be unfit for habitation through defective construction against principal contractors, sub-contractors, architects, or employers. Claims that have been previously settled cannot be re-opened within the new limitation settings.

The Act also introduces a new section 2A to the DPA 1972, extending the scope of potential claims from those related to the original construction or conversion of a dwelling to work "in relation to any part of" a dwelling, which will also include repair works.

The previously dormant section 38 of the Building Act 1984 has also been brought into force, providing a statutory right to compensation for physical damage caused by those in breach of building regulations. The section is not limited to dwellings or residential property as with many other provisions, but covers any building in England and Wales. Enforcement does not have retrospective effect, but causes of action accruing after 28 June 2022 will have a limitation period of 15 years.

The Act carries notable significance for all companies that may have ever been part of or associated with a group of companies engaging in the construction or development of a building. The High Court can now issue a Building Liability order (BLO) under section 130, effectively extending liabilities under the DPA 1972, s. 38 BA 1984, or for "building safety risks", to all companies associated with corporate body. The aim is to circumvent the practice of using temporary corporate structures which are subsequently closed down after completion of works in order to escape potential liabilities.

If you have not done so already, now is the time to review retention policies for contracts, documents, and records for evidential purposes in relation to potential future claims. You may wish to reconsider live contracts in existence, or those that are due to be signed, and to revisit liabilities in historical projects that had previously been considered statute barred. It is important to bear in mind that prospective claims are not restricted to safety matters and may encompass a far wider remit than principal contractors, designers and developers.

For more information contact David Mayor in our Insurance department via email or phone on 01254 222416. Alternatively send any question through to Forbes Solicitors via our online Contact Form.

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