First time the property tribunal rules in favour of leaseholders under the Building Safety Act
Arjun Batish, 32, a leaseholder with no legal experience has won a leaseholder revolt against developer and freeholder Inspired Sutton to pay back almost £200,000 that was wrongly demanded to pay to remove cladding and replace dangerous balconies.
The case, believed to be the first time the First Ter Tribunal has considered the Building Safety Act 2022, is reported in The Times today:
Meet the cladiator who took on his developer over fire safety – and won
For the past six years the victims of Britain’s cladding crisis have often been just that: helpless casualties of housebuilder ineptitude and governmental misma
Faced with his shared of the bill – £18,000 – Arjun Batish led a group of 18 leaseholders in their dispute, which was heard by tribunal president Siobhan McGrath and Timothy Powell, who heads the London division.
Unfortunately Batish, who works in finance, his wife Eleanor and 12-week-old son Arthur are still enmired in other issues surround the building safety scandal.
The couple met as neighbours at the converted office building in Sutton, south west London, where both had bought flats for £360,000 (his) in 2018 and £270,000 (hers) in 2017.
He told The Times: ““What really makes my blood boil is that . . . [housebuilders] . . . are in this for the money and they have no incentive to do the right thing. But these are people’s homes and lives they are dealing with.”
Alarm bells rang in 2019 when Inspired Asset Management, owner of Inspired Sutton, went into administration. It was the administrators who issued the cash call from the leaseholders.
As so often, the block was badly built with flaws that broke elementary regulations: on conversion the building increased from 9 to 11 storeys. But the dry riser — a pipe running up the inside of the building that firefighters can tap into to use as a pressurised water system — only reaches up to the ninth floor. And a car parking space is installed right in front of it.
A government grant for £1 million covered removing the cladding, but not the balcony replacement (£388,000).
The total bill at 9 Sutton Court Road totted up to £3.7 million, and Batish’s share for the amount not covered by the grant was £18,000.
He tried lawyers but was deterred by their expense – £120,000 was one estimate – and set about studying the Building Safety Act.
Inspired Sutton was an SPV (a special puprose vehicle) to develop the site and sell on the freehold, but this fell through in 2018 after the buyer was spooked by the fallout from Grenfell. So it remained the landlord.
Section 122 of the Building Safety Act provides:
“122 Remediation costs under qualifying leases etc
Schedule 8 –
a/ provides that certain service charge amounts relating to relevant defects in a relevant building are not payable, and
b/ makes provision for the recovery of those amounts from persons who are landlords under leases of the building (or any part of it).”
And paragraph 2 of Schedule 8 provides:
“No service charge payable for defect for which landlord or associate responsible”
As a result, the bill is passed to Inspired Sutton Limited.
An attempt was made by a barrister for Inspired Asset Management Limited, now in liquidation, to dob its legal costs on the leaseholders failed. But he did manage to remove this entity as a party to the proceedings.
When a trading entity the directors were property developers Martin Jonathan Skinner and Jeremy David Beck.
Mr Stephen Burns
I wish their were more Leaseholders like Mr. Arjun Batish, he really is an example to others. I admire your courage and determination and for your victory against injustice. The publicity that you have generated will travel far and wide and give others food for thought and hopefully inspiration to follow your excellent example.
Well done to Arjun Batish. He was lucky his case was heard by two full time judges and the most senior judges, Siobhan McGrath and Timothy Powell at the FTT rather than one who is a barrister one day and a “judge” the next day. In my experience outcomes vary wildly and some members of the legal profession are allowed to conduct cases as if they are in the high court racking up costs, not at a tribunal which is supposedly accessible to all.
Accountants on panels, more surveyors and full time judges would make for a fairer system.
Arjun Batish deserves massive credit to take on the case himself, and is a role model for other leaseholders to have the courage to stand up, not only to their landlod freeholders but the impossibly flawed legal system. Not sure which is worse! As has often been stated in these columns, the legislation and the thinking behind it, is stacked against us tenant leaseholders so any win exposing an avenue to pursue is invaluable information for others to follow suit.
Taking on the built-in unpredictability of the interpretation of the Landlord & Tenant legislation and the ruthless and entrenched spirit of leaseholder law – with the odds overwhelmingly on the side of the barrister/solicitor/landlord can be utterly demoralising as I have recently discovered first hand, having imitated Arjun in a case in rural Norfolk (not cladding reated!) .
We are awaiting the FTT’s pronouncement, but will share it when we have received it.
Well done Mr Batish. It’s not easy taking on these giants…Agree with Shelley FTT can really vary and should even out with less who have a commercial background who from my experience are more pro landlords…