The First Tier Tribunal Property Chamber (Residential Property) has ruled on the Fresh Apartments, Salford case.

On 31 July 2017, the Tribunal received an application from E&J Ground Rents No 11 LLP, the freehold owner of Fresh Apartments in Salford, near Manchester. The property comprises of 141 residential apartments above ground floor commercial units and an undercroft car park. Built in 2007, the block ranges from 3 to 10 storeys and is of steel, concrete and masonry construction clad in three different types of cladding; composite cladding panels, rain screen Aluminium Composite Cladding (ACM3 - the least fire resistant type) panels and render.

Following the Grenfell Tower tragedy, many tall buildings with similar external cladding were subject to interim fire protection measures. Following discussion between the managing agents, Premier Estates, and the Greater Manchester Fire and Rescue Service, a 24-hour Waking Watch was introduced to have the building patrolled to detect a fire quickly, then alert the emergency services and all the residents to evacuate the building. Speed is of the essence because the normal ability of a building to contain a fire for a reasonable period may have been compromised by the cladding system used. The freeholder’s appointed risk assessors confirmed that a Waking Watch should be in place to comply with DCLG guidance.

The lessor is obliged to keep the Maintained Property in good and substantial repair and condition. The service charge provisions allow the lessor to recoup the cost of maintaining the external communal areas of the Maintained Property and the Building. Also for “complying with the requirements and directions of any competent authority”; also for “all other expense…  … Incurred in rectifying or making good any inherent structural defect in the Building or any part thereof”.

There were four elements to this Tribunal hearing

1. Whether the lease enabled the landlord to recover the cost of the Waking Watch through the service charge; a contractual matter.
2. Whether the costs of the watch are to be taken into account in determining the service charge having regard to S19 of the Landlord and Tenant Act 1985.
3. Whether the watch is a Qualifying Long-Term Agreement for the purposes of S20 of the 1985 Act.
4. Costs for the proceedings.

The Tribunal was satisfied that a Waking Watch was expenditure that was reasonably incurred and that the Greater Manchester and Fire Rescue Service is a competent authority to direct the freeholder to comply with statute and that while the applicant was not specifically directed to provide a Waking Watch, this was the mechanism chosen to comply with the Fire safety order and Fire Service Action Plan. The Tribunal agreed with the applicant that the cost of providing the Waking Watch is recoverable from the lessees of the property as part of the service charge pursuant to the provisions of the lease.

The Tribunal agreed it was not a Qualifying Long-Term Agreement, the freeholder contending this was not a rolling month-to-month contract but instead a fresh purchase order was raised each month to instruct the supplier for the month ahead. On costs, the Tribunal decided the applicant was entitled to bring proceedings to establish its entitlement to recover these costs through the service charge and thus the Tribunal did not award costs against the applicant.

Comment: Philip Parkinson, Legal Director of the applicant’s law firm JB Leitch, said “The decision of the First-tier Tribunal demonstrates the approach that will, and should, be taken when considering the difficult issue of liability for protective fire safety measures at residential developments. Evidently, consideration must be given to the contractual terms between the parties and what measures are reasonable in the specific circumstances of the case. Furthermore, the Tribunal has given careful consideration to the correct implementation of fire marshalls and the interplay between the landlord and tenant relationship and the necessity to insure.”