Excluded costs for higher-risk buildings LTA 1985 s. 20F
Excludes certain costs under Part 4 of the Building Safety Act 2022 from being counted as relevant costs for service charges in leases subject to section 30D.
This section applies in relation to a lease to which section 30D (higher-risk buildings: building safety costs) applies. Excluded costs are not to be regarded as relevant costs to be taken into account in determining the amount of service charge payable by a tenant under the lease. In this section “ excluded costs ” means any of the following incurred in connection with Part 4 of the Building Safety Act 2022 or regulations made under that Part— costs incurred or to be incurred by or on behalf of a relevant person solely as a result of any penalty imposed or enforcement action taken by the regulator; legal costs incurred or to be incurred by or on behalf of a relevant person in connection with special measures order proceedings; costs incurred or to be incurred by or on behalf of a relevant person by reason of any negligence, breach of contract or unlawful act on the part of that relevant person or a person acting on their behalf; costs of a description prescribed by regulations made by the Secretary of State that are incurred or to be incurred by or on behalf of an accountable person or special measures manager for the building in connection with the taking of building safety measures. In this section— “ building safety measures ” has the meaning given by section 30D; “ enforcement action ” means action taken with a view to, or in connection with— securing compliance with Part 4 of the Building Safety Act 2022 or regulations made under that Part, or the imposition of a sanction in respect of a contravention of that Part or those regulations; “ the regulator ” has the meaning given by section 115 of the Building Safety Act 2022; “ relevant person ” means— where the landlord under the lease is an accountable person for the higher-risk building, the landlord or a special measures manager for the higher-risk building; where the landlord is not such an accountable person, any superior landlord who is an accountable person for the higher-risk building or a special measures manager for the higher-risk building; “ special measures order proceedings ” means any proceedings relating to the making, variation or discharge of, or the giving of directions in relation to, a special measures order under Schedule 7 to the Building Safety Act 2022 (including any appeals in relation to such proceedings). Regulations under this section are to be made by statutory instrument. A power to make regulations includes power to make— incidental, transitional or saving provision; different provision for different purposes. A statutory instrument containing regulations under this section is subject to annulment in pursuance of a resolution of either House of Parliament.
Text in force at .
Source: legislation.gov.uk — The National Archives (legislation.gov.uk), reproduced under licence Open Government Licence v3.0.
What it actually says
This section applies to leases where section 30D (higher-risk buildings: building safety costs) applies. It lists costs that are excluded from being treated as relevant costs when calculating the service charge payable by a tenant. The excluded costs are: penalties or enforcement action costs imposed by the regulator; legal costs for special measures order proceedings; costs caused by the landlord’s negligence, breach of contract, or unlawful act; and other costs prescribed by regulations. Any such costs cannot be passed on to the tenant through the service charge.
The section defines key terms: “enforcement action” includes steps to secure compliance with Part 4 of the Building Safety Act 2022 or to impose sanctions; “the regulator” is as defined in section 115 of that Act; “relevant person” means either the landlord if they are an accountable person for the building, or a superior landlord who is an accountable person, or a special measures manager. “Special measures order proceedings” cover any proceedings related to a special measures order under Schedule 7 to the Building Safety Act 2022.
Regulations under this section are made by statutory instrument and can include incidental, transitional, or saving provision. The statutory instrument is subject to annulment by resolution of either House of Parliament.
When it applies
- The regulator imposes a financial penalty on the landlord for failing to comply with building safety regulations, and the landlord tries to include the penalty in the service charge.
- The landlord incurs legal costs defending a special measures order application and attempts to pass those costs to tenants.
- A landlord’s negligence causes a breach of building safety requirements, and the resulting costs are billed to tenants as a service charge item.
- The Secretary of State prescribes a type of cost by regulations that the landlord wants to recover through the service charge.
What this section does not say
- This section does not cover general disputes about the reasonableness of service charges under section 19 of the Landlord and Tenant Act 1985.
- It does not apply to costs of remediation works for building safety defects, which are dealt with under sections 20D and 20E of the same Act.
- It does not apply to leases that are not subject to section 30D (higher-risk buildings: building safety costs).
- It does not exclude all costs related to building safety, only the specific categories listed in the section.
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This page reproduces the text of LTA 1985 s. 20F in force at the date shown and explains it in general terms. It is not legal advice and takes no account of the circumstances of your case, which can change the answer completely. For a live dispute, for limitation periods, and before taking any step in court, consult a qualified lawyer in England and Wales.