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Tribunal rules leaseholders must pay £3m cladding costs
Leaseholders in two privately owned high rises will have to pay around £3m to remove and replace dangerous cladding from their homes, a tribunal has ruled.
Vallea Court and Cypress Place, which are comprised of 345 flats, were last July found to have category 3 aluminium composite material cladding (ACM) similar to that used on Grenfell Tower.
Pemberstone, a property investor which purchased the freehold to the two Green Quarter blocks in 2015, took leaseholders to tribunal to argue it should not foot the bill for remediation work.
At a hearing yesterday, Judge Wood ruled that the lease agreements do allow the company to charge for cladding costs through service charges.
He added: “The points relating to whether or not the cladding materials used were or were not compliant with building regulations and/or whether it was morally right for the applicant to see to recover the costs from the leaseholder were matters outside of the tribunal’s jurisdiction, as they related to matters outside of the contractual relationship established between landlord and tenant under the CP [Cypress Place] leases.”
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The leaseholders were also told they must each pay for Pemberstone’s legal costs in addition to at least £10,000 each for the cladding fee, while Vallea Court flat owners are also required to pay for a waking watch at the block until it is made safe.
The buildings were developed by Lendlease, while design and build on the scheme was handled by Shepherd Construction.
A spokesperson for Pemberstone said: “Now that the tribunal decision has been issued, this should allow us to establish a clear way forward.
“We do appreciate the concerns of the owners, particularly the minority who live in their own apartments. We will consider carefully and sympathetically how any payments can be structured to spread the cost over time.
“The safety of residents has always been paramount, and our property managers Livingcity continue to liaise closely with Greater Manchester Fire and Rescue Service.”
It claimed that 75% of the affected flats are owned by investors, “some of whom are located overseas”.
At the latest count, 301 privately-owned high rises around the country are clad in dangerous ACM.
In a handful of cases, developers and owners have agreed to front the cost of its replacement.
The government has said that building owners have a “moral responsibility” to pay for this type of work.
Amy Wright, a leaseholder at Green Quarter, said: “This decision shouldn’t be about what’s legally written into a sweeping clause in a contract, this is about large corporate organisations standing up and doing what is morally right and demonstrating the ‘social responsibilities’ that they seem to promote so proudly on their websites.
“We need the support of those in high-powered positions, such as Andy Burnham, to support our fight to put a stop to the obscenity of these profit driven organisations who will consider nothing of putting hundreds of hard-working residents into financial ruin.”
Lendlease declined to comment.
No-one from Shepherd Construction was available for comment.
