The impact of the cladding crisis has been widely reported. In the wake of the devastating Grenfell fire, it has become apparent that a large number of buildings containing residential flats have external cladding that is dangerous and requires removal.
The government continues to wrestle with the vexed issue of who should pick up the tab, but for some leaseholders, every day that goes by results in more and more cost. This is because a number of freeholders have put in place interim fire safety measures, including fire alarm systems and 'walking watch' services. The Financial Ombudsman Service has released an interesting decision on a case brought by two flat owners under their new build warranty cover, in this case, the National House Building Council (NHBC).
The Ombudsman found that, in their particular case, the terms of the NHBC Buildmark policy did cover the costs of the fire alarm installation cost and walking watch. The NHBC was ordered to pay these costs, plus interest and a modest sum for compensation.
This decision does not automatically mean that the NHBC will be liable for remediation costs in such cases as the Ombudsman made it clear that each case would depend on its own facts and the terms of the particular Buildmark policy. However, it does represent a small glimmer of hope for leaseholders and they should take advice to establish whether their new build policy will at least cover some of the crippling costs brought about by this situation.
To discuss this or any other property litigation matter, contact us.