Technical - Legal & Regulatory Compliance Flashcards
What is Reliance?
- When a party relies on a report/advice to allow them to make a decision that exposes them to financial risk.
- The party holds the right to claim damages if it suffers a loss due to the informed decision.
Name the three categories of leases.
- Full Repairing and Insurance (FRI)
- Internal Repairing and Insuring
- Internal Repairing
What is a Schedule of Condition
- A SoC is a record (photographic and descriptive) of the condition of a property at a certain point in time when referenced and attached to a lease.
Why would a Schedule of Condition be required?
The schedule of condition can be used to protect both landlord’s and tenant’s interests and can be used to accurately understand the repairing, reinstatement and redecoration obligations at the lease end.
What is Service Charge?
- Charges to the Tenant for costs incurred by a Landlord to maintain and manage the property.
- Budget is agreed before year commences.
What is a License for Alterations?
- Is a legal document giving permission from the Landlord to the Tenant giving consent to carry out proposed works or alterations to a property.
When reviewing a License and giving recommendation on whether to consent, what should you consider.
- Lease Wording - Are alterations permitted, do they require consent, is there a superior landlord?
- Existing Building - will there be any detrimental impact of the building structure, operation or services?
- Financial matters - are bonds, warranties, insurance required for the benefit of the landlord?
- Statutory - Is planning or listed building consent required.
- Is planning or listed building consent required.
What is a break clause?
- Commonly found in commercial leases.
- Permit tenants to terminate their lease on an intermediate date.
- May need to follow conditional requirements detailed within the lease such as service of notice, payment of premium (rent), vacant possession, compliance with other lease obligations.
What are the Building Regulations?
- The Building Regulations are made under powers provided in the Building Act 1984, and apply in England and Wales
- They exist to ensure the safety of people in and around all types of buildings.
- They also contain provision for energy conservation (L), access to and the use of buildings (M)
What is deemed to constitute Building Work under the Building Act 1984?
- Building Work is defined in Regulation 3 of the Building Regulations.
- The definition means that following types of project amount to ‘Building Work’
1. The erection of extension of a building.
- The installation of extension of a service of fitting which is controlled under the regulations.
- An alteration project involving work which will temporarily or permanently affect the ongoing compliance of the building, service or fitting with the requirements relating to structure, fire, or access to and use of buildings.
What are the approved documents?
- The approved documents provided guidance on how the Building Regulations can be satisfied?
- They have legal status under the Building Act 1984
What are the approved documents?
- The approved documents provided guidance on how the Building Regulations can be satisfied?
- They have legal status under the Building Act 1984 and there are 14 approved documents in total.
Can you name some of the approved documents?
A - Structural
B - Fire Safety
C - Site preparation and resistance of moisture
D - Toxic substances
E - The resistance to the passage of sound
F - Ventilation
G - Hygiene
H - Drainage and waste disposal
J - Combustion appliances and fuel storage system
K - Protection from falling, collision and impact
L - Conservation of fuel and power
M - Access to and use of buildings
P - Electrical safety
Q - Security
How would you get building regulations approved for a project?
- Anyone wanting to carry out works which are subject to the Regulations are required by law to make sure it complies with the regulations and to use one of the two Building Control services:
- The Building Control Service provided by your local authority.
- The Building Control Service provided by approved inspectors.
Who is responsible for ensuring compliance with the Building Regulations?
- The primary responsibility for achieving complaince rests with the person carrying out the works.
- If a client is carrying out the work in their name, the responsibility will be theirs.
- If the client employs a building the responsibility will usually fall to the builder they are appointing however they should confirm this position at the beginning.
- Client’s should also bear in mind that if they are the owner of the building, it is ultimately the Client who may be served with an enforcement notice if the work does not comply with the regulations.
What is the difference between Local Authorities and Approved Inspectors?
- Local authorities are responsible for ensuring work complies with the Building Regulations.
- Approved Inspectors are approved by the local authority to inspect, supervise and authorize works against the regulations.
Why would you opt to use an approved inspector?
Because they are generally seen to be more responsive and open to giving advice than local authorities.
Are there any timeframes involved with the appointment of an approve inspector?
If you appoint an approved inspector they need to serve an initial notice on the council and that has to be validated 5 working days before the project commences.
What are the 2 types of Building Regulations Application?
- Building Notices: more suitable for minor residential alterations or extensions. No formal plan requirements, as it is reviewed on-site. Work can be commenced 48 hours after issuing the notice. However, the Building Control Officer must be notified when the works are being carried out so they undertake an inspection.
Full Plans Application: This when detailed plans, specifications and structural calculations are submitted to the council. These are checked by the local authority to ensure they meet the regulations. Generally approval is given within 8 weeks although this can vary between different authorities. When the plans are satisfactory a formal approve is provided. In some cases a notice of rejection may be issued if they are not met.
What is a plan certificate?
This certificate is issued by Building Control and confirms the plans and details provided have been reviewed and confirmed to comply with Building Regulations.
What is a final certificate?
Following completion of the works, a Final Certificate will be issued by the local authority if the actual works comply with Building Regulations.
When are consequential improvements triggered for non-domestic buildings under Part L?
- When a building is over 1000m2 and the works involve significant extension or refurb and also when extending or replacing a fixed building service.
- If this is the case then 10% of the value of the works should be spent on improvements.
- The costs must be reasonable with a payback period with 15 years.
What are consequential improvements?
These defined improvement works were implemented in 2006 within the updated Building Regulations. Designed to conserve fuel and power in existing buildings, there were new requirements that meant the existing buildings would need to be improved when work was to be carried out. This extra work was classed as consequential improvements.
What enforcement options are available under building regulations?
- If a person carrying out building work contravenes the Building Regulations, the local authority or another person may decide to take them to the magistrates’ court where they could be fined for the contravention.
- This action will usually be taken against the builder or main contractor, although proceedings must be taken within 6 months of the offence (Sec. 127 of the Magistrates Courts Act 1980)
- Alternatively, or in addition, the local authority may serve an enforcement notice on the owner requiring them to alter or remove work which contravenes the regulations (Sec 36 of the Building Act 1984)
- If the owner does not comply with the notice the local authority has the power to undertake the work itself and recover the costs from the owner.
What prior approval are required before undertaking demolition works?
- Demolition is dealt with under the Building Act 1984
- Generally, it requires 6 weeks notice to be given to Local Authority before it begins.
- The Local Authority Building Control may decide to issue a notice within 6 weeks on receipt of the notifications to specify conditions, such as protection to adjoining properties and the public.
- Demolition work must also comply with the CDM Regulations and Health & Safety produced by the Principal contractor.
Give me some examples where planning permission is required?
- A new build construction on a vacant site.
- A new build extension that is not permitted development.
A change of use that is not permitted change of use.
- The increase in the eight of a fence adjacent to a highway above 1m in height.
What information is contained within a planning application?
- Name of client
- Name of agent
- Site address
- Details of the works
- Details of the proposed materials.
- Plans and elevation drawings
- Access statements
What is the timeframe for planning consent?
- 8 weeks from the validation of the application
- Listed building consent can be longer
What resource is available in the case that permission is rejected?
- If I felt there were grounds to appeal then I could have prepared an appeal form stating the reasons for the appeal with evidence.
- This can be appealed in the courts within 6 months of the decision.
What enforcement action can be taken?
- A planning contravention notice notice can be issued requiring the owner to provide information to the local authority.
- The local authority can enter land and property with 24 hours notice to investigate any suspected breaches.
- Stop notices can also be issued to suspend ongoing works.
Is there a limit as to when enforcement actions can be taken?
- Change of use to a single dwelling house is within 4 years from completion of the works.
- Everything else is within 10 years from completion of the works.
What is a NPFF?
- The National Planning Policy Framework sets out the Goverment’s planning polices for England and how these are expected to be applied.
- The National Planning Policy Frame (NPPF) was published March 2012
- It is designed to make the planning system less complex and more accessible, to protect the environment and to promote sustainable growth.
What are the policies behind the NPPF?
- Sustainable development - At the heart of the NPPF is a presumption in favour of sustainable development
- Community decision making: To give decision making power back to the local communities with neighborhood plans and therefore changing to a decentralized decision making process is going to lead to greater variation.
Town Centre renewal: Aims to encourage town centre vitality suggesting that edge of town site should only be used if connect to town centre or if no viable town centre site are available
- Housing: Identify and update annually a supply of deliverable site sufficient for a 5 year supply of housing.
What is a listed building?
A listed building is a building that has been placed on the Statutory List of Buildings of Special Architectural or Historic Interest.
How is a building listed?
- In England, to have a building considered for listing or de-listing, the process is to submit an application form online to English Heritage.
- The applicant does not need to be the owner of the building to apply for it to be listed.
- English Heritage assesses buildings put forward for listing or de-listing and provides advice to the Secretary of state on the architectural and historic interest.
- The Secretary of State, who may seek additional advice from other, then decides whether or not to list or de-list the building.
Under what legislation is a building listed?
In England and Wales the authority for listings is granted to the Secretary of State by the Planning (Listed Buildings and Conservation Areas) Act 1990
What classifications of listed building are there?
- There are three types of listed status for buildings in England and Wales.
- Grade I Buildings are of exceptional interest with just 2.5% of listed stock being in this category.
- Grade II* Buildings are particularly important of more than special interest with around 5.8% of listed stock being in this category.
- Grade II Buildings are of special interest warranting every effort to preserve them with around 90% of listed buildings being in this category.
Why are Buildings listed?
- The criteria for listing include architectural interest, historic interest and close historical associations with significant people or events.
- The criteria include:
1. Age and rarity
2. Aesthetic merits
3. Selectivity: Most representative
4. National Interest
What part of a building is listed?
- Although the decision to list a building may be made on the basis of the architectural or historic interest of one small part of the building, the listing protection applies to the whole building.
- Listing applies not just to the exterior fabric of the building itself, but also to the interior, fixture, fittings, and objects within the curtilage of the building even if they are not fixed.
What about the curtilage of a building?
- Any building or structures constructed before 1 July 1948 that fall within the curtilage of a listed building are treated as part of the listed building and therefore approve must be sought before altering.
- The effect of a proposed development on the setting of a listed building is a material consideration in determining a planning application.
- Setting is defined as “the surroundings in which a heritage is experienced”.
How can a listed building be de-listed
- In the same way as it is listed an application is made to English Heritage and they advise the secretary of state who makes the decision.
- De-listing is possible but rare in practice and is likely to min. 5 months.
When would you need to apply for listed building consent?
- A listed building may not be without consent demolished, extended, or altered without special permission from the local planning authority.
How long does it take to gain listed building consent?
From validation of application most authorities aim to have decision within 8 weeks although it can take up to 12.
What enforcement action can be taken if a listed building is falling into disrepair?
- Section 215 of the Town & Country Planning Act 1990, provides a local planning authority with the power, in certain circumstances, to take steps requiring land to be cleaned up when its condition adversely affects the amenity of the area.
- Urgent Works Notices - An urgent works notice may be served where works are urgently necessary for the preservation of a listed building. Mainly to with maintaining structural integrity and weathertightness. This allows for works to be undertaken by the LPA and the cost recovered from the owner.
- Repair Notices: Can lead to compulsory purchase of a property by the LPA if repairs are not carried out. Works undertaken under a repairs notice are long-term repairs to put and keep in good repair.
- Compulsory Purchase Order: Many LPA were reluctant to use their repair power. Since they were afraid the owners might respond, as they are entitled to do, by serving a purchase order on the council. The council would thereby be obliged to purchase the building and repair it at the taxpayers expense.
What enforcement action can be taken when a Listed Building Consent has been breached?
- An enforcement notice requiring the breach to be remedied.
- A stop work notice can also be issued.
Is there a time bar on enforcement as is the case with planning?
- There is not time limit for listed building consent.
What is the time bar on planning enforcement?
- There are two time limits, laid down in Section 171B of the Town and Country Planning Act 1990.
- Four years is the time allowed for an authority to take enforcement action where the breach comprises either operational development (the carrying out of unauthorised building, engineering, mining or other operations_ or change of use to use as a single dwellinghouse.
- Ten years is the time allowed for all other breaches of planning control.
Is there any dispensation for VAT on works to a listed building?
- Alterations to listed buildings that are designed as dwellings or used for qualifying residential or non-business charity purposes, together with those that are being converted to such use, are not subject to VAT as long as the work is done by a VAT registered building and with listed building consent
Please explain your understanding of the term Dilapidations?
- Dilapidations refer to breaches of lease obligations either implied or expressed.
- Typically they relate to reinstatement, repair, redecoration and subsequent costs associated with carrying out these works.
- A schedule of dilapidations is normally produced to identify any breaches of the lease.
- The legal remedy is typically a claim for damages if not rectified prior to lease expiry.
Are you aware of any RICS Guidance on Dilapidations?
- The RICS has produced the guidance note ‘Dilapidations in England and Wales 7th Ed. (2016).
- The note aims to provide best practice guidance on:
- Producing schedules of condition: A document identifying breaches made under a lease or tenancy. This normally sets out the obligations required under the lease, the breaches thought to have taken place along with any identified cost of remedial works required in order to rectify the breaches.
- Scotts Schedules: A schedule of dilapidations with additional information provided on each of the parties views on the alleged breaches and subsequent remedial works that are required.
- Diminution Valuation: A valuation carried out in order to determine the reduction in value of a landlords property as a result of a tenants breach of the lease terms.
What are the potential roles of a surveyor in relation to dilapidations?
- Surveyors can act as advisors, expert witnesses or dispute resolvers.
- They may be required to identify and comment on alleged breaches of the lease and have a duty to act objectively without over exaggerating or under exaggerating potential claims.
- As a result of their duties they may also be required to give evidence before a court or tribunal.
- Surveyors are bound by the RICS Practice Statement ‘Surveyors Acting as an Expert Witness’ where their duty to Clients is overridden by a primary duty to the courts.
What are the 5 stages of Dilapidations?
Stage 1: Preparation (Obtain all relevant information)
Stage 2: Inspection (Establish original condition, standard of repair, take into consideration age, character and location)
Stage 3: Preparation of Schedule of dilapidations setting out hte obligations required under the lease, the breaches thought to have taken place along with any identified cost of remedial works required in order to rectify the breaches.
Stage 4: Quantified Demand is a document issued setting out:-
- The Cost of the Repair Works
- The loss of value to the property
- Loss of rent and services charges
- Rates
- Insurance
- Security
- Utilities
- Cleaning
- Finance Costs
- Professional Fees incurred
Stage 5: The response and negotiation (Under pre-action protocol, surveyor should meet within 26 days)
What is the difference between a Terminal and Interim Schedule of Dilapidations?
Terminal: A term given to a schedule that is prepare in anticipation of the lease ending and either issued on expiry of the lease term or shortly afterwards. This also includes reference to yield up obligations the tenant has when vacating the property and any repairs that are required upon leaving.
Anticipated (within 18 months of expiry)
Terminal served at expiry or within 56 days
Interim: A schedule that is prepared in contemplation of the remedy of any alleged breaches that are thought to have taken place prior to the lease expiry and this does not contain any reference to yield up obligations that result from the tenant leaving the property.
At least 18 months remaining on the lease/break
What are break clauses?
- They permit tenants and landlords to terminate leases on an intermediate date during the lease term.
- Some clauses are conditional which required compliance before a break is deemed effective, for example:-
- Vacant possession is provided by the tenant.
- Issue of notice
- Compliance with certain lease obligations
What is the Pre-Action Protocol?
- This sets out the particular conduct a court would expect from both parties prior to escalation to court proceedings in relation to commercial property claims.
- It establishes a reasonable process and timetable for the exchange of information relevant to a dispute and sets standards for the content and quality of schedules an quantified demands in particular the conduct of pre-action negotiations.
What are Part 36 offers?
- A part 36 offer is a written offer to settle which must specify a period of not less than 21 days during which it can be accepted.
- If it is not accepted within the time period and the other party does not achieve a higher value than the one contained within the Part 36 offer, there will be cost consequences for the claimant.
What are Calderbank offers?
- A Calderbank offer provides greater flexibility that a Part 36 offer because it is not governed by strict court rules.
- This is advantageous because it allows the party making the offer to be creative when issuing especially when putting forward terms about the length of time the offer remains open for acceptance, costs and payment issues.
- The price for flexibility is that Calderbank offer, if accepted, create a binding contract between the parties.
- A Calderbank offer can be useful tool to settle disputes where Part 36 does not apply, for example in cases allocated to the small claims track and arbitration proceedings.
What is the Landlord and Tenant Act 1985?
- The primary UK legislation for governing the minimum rights are responsibilities of both Landlord and Tenants.
- The Act was introduced in 1985 and is applicable to all short leases of less than seven years.
- Key obligations of the Landlord include:
1. To keep in Repair the Structure and Exterior of the Dwelling including drains, gutters and external pipes.
2. To keep in repair and proper working order the installations in the dwelling for the supply of water, gas and elec.
3. To keep heating installations in good repair
What is the Law of Property Act 1925?
- Prior to 1925, the purchase of land was extremely difficult for potential purchasers
- The process was lengthy and required extensive investigation into the seller’s right and title to sell the land.
- The main object of the 1925 legislation was to facilitate and cheapen the transfer of land.
- Section 52 & 53 provide that, subject to limited exception, all conveyancers of land (or interests therein) must be in writing, and where required, by way of deed.
What is the Defective Premises Act 1927?
- Primary price of UK legislation that stipulates the liability of landlords’ and contractors for poorly constructed and poorly maintained building in addition to any injuries that may occur as a result.
- Contractors and their sub-contractors hold a duty of care to the occupiers of property they construct or modify.
- Landlords also hold a duty of care towards their tenants and third parties who might be injured by their failure to keep their property in a good state of repair.
- Section 1 lays out the duty of care and who it applies to. The duty applies to any person taking on work for or in connection with the provision of a dwelling and is something including not only builders but also electricians, plumbers and other subcontractors.
- Section 4 establishes a general duty to repair and maintain property owed by Landlords to anyone who could reasonably be expected to be harmed by a breach, this covers tenants, their friends and family and also trespassers.
