Almacantar Centre Point Nominee No.1 Ltd & Ors v Penelope de Valk & Ors [2025] UKUT 298 (LC).
The Upper Tribunal has dismissed an appeal bought by the landlord applicant, Almacantar, ruling in favour of the leaseholders. It has given the widest interpretation to the meaning of "cladding", "cladding remediation" and provided guidance on what is meant by an unsafe cladding system under the Building Safety Act 2022 ("the BSA"). This decision involves the iconic Centre Point House in Tottenham Court Road. The judgment cements the Upper Tribunal's desire to uphold Michael Gove's pledge that no leaseholder living in their home will pay the cost of remediating unsafe cladding.
The effect of the decision is cladding remediation can extend to cladding installed more than 30 years ago.
Background
Centre Point House was constructed between 1963 and 1966. It is accepted by the landlord, Almacantar, that the façade requires remediation. However the question before the First Tier Tribunal (Property Chamber) ("the FTT") and subsequently the Upper Tribunal was whether the costs of the proposed remediation works ("the Scheme") could be recovered as a service charge from the leaseholders pursuant to their leases or whether the leaseholder protections introduced by Part 5 and Schedule 8 of the BSA afforded them protections against those costs.
The FTT decided the façade at Centre Point House was an unsafe cladding system within the meaning of Paragraph 8 of Schedule 8 of the BSA meaning “qualifying leaseholders” did not have to contribute towards the cost of the Scheme. This was on the basis that pursuant to Paragraph 13(2) of Schedule 8 of the BSA the leaseholders were presumed to hold qualifying leases.
The appeal
The landlord appealed the FTT's decision on the following 5 grounds, with permission to appeal being granted on grounds 1 – 4 by the FTT and the Upper Tribunal giving permission to appeal on ground 5:
Ground 1 – the FTT erred in finding that Paragraph 8 of Schedule 8 of the BSA applied to the Scheme.
Ground 1A – the FTT was wrong to find Paragraph 8 of Schedule 8 of the BSA applied to the Scheme because the Scheme did not relate to the remediation of "relevant defects".
Ground 2 – the FTT erred in finding every part of the Scheme fell within Paragraph 8 of Schedule 8.
Ground 3 – the FTT was wrong to find the façade at Centre Point House was a cladding system which forms the outer wall of an external wall system which is unsafe (as required by Paragraph 8 of Schedule 8).
Ground 4 – given its finding (as per ground 3) the FTT was wrong to find the façade at Centre Point House was unsafe and therefore wrong to find no service charges were recoverable in respect of the Scheme from the leaseholders who hold qualifying leases.
Ground 5 – The FTT was wrong to determine that the leaseholders benefited from the presumption that they held qualifying leases. The landlord asserted this point on the basis that it said the FTT had made an unqualified finding of fact.
The decision
Ground 1A - Does Paragraph 8 of Schedule 8 provide protection to cladding remediation only where the works are to remedy a relevant defect?
No. The Upper Tribunal decided paragraph 8 of schedule 8 was not confined to remedying relevant defects.
Paragraph 8 of Schedule 8 states:
(1) No service charge is payable under a qualifying lease in respect of cladding remediation.
(2) In this paragraph “cladding remediation” means the removal or replacement of any part of a cladding system that – (a) forms the outer wall of an external wall system, and (b) is unsafe.
A relevant defect is a defect which causes a building safety risk and arises as a result of or in connection with relevant works. Relevant works are works undertaken in the 30 years prior to 28 June 2022 or any works undertaken after this date to remedy a relevant defect. The landlord argued that the Scheme did not involve remedying relevant defects and therefore paragraph 8 of schedule 8 did not apply. It therefore argued that the qualifying leaseholders did not benefit from the leaseholder protections under the BSA. The landlord sought to argue that the entirety of Part 5 and Schedule 8 of the BSA only applied to relevant defects and Paragraph 8 of Schedule 8 should not be excluded from that regime.
The Upper Tribunal disagreed. Paragraph 8 of Schedule 8 does not use the words "relevant defects" and no words to that effect should be implied into its interpretation. The legislators were intentional in excluding this term and further, the words used in Paragraph 8 of Schedule 8 of the BSA were clear and unambiguous. 
.
Ground 1 – 4 – does Centre Point House have "cladding", a "cladding system" and is that cladding system unsafe?
Paragraph 8 of Schedule 8 is triggered where there is a cladding system that forms the outer wall of an external wall system which is unsafe.
No expert evidence was put before the Upper Tribunal. However, the FTT heard substantial expert evidence before it decided there was cladding at Centre Point House. This was a key issue raised before the FTT and the Upper Tribunal because the BSA does not define what is meant by cladding. Both the FTT and Upper Tribunal were keen to highlight that there are many forms of cladding (and cladding systems), and each case will turn on its own facts, requiring detailed expert evidence.
There is also no definition of cladding system but the Upper Tribunal rejected the landlord's argument that a cladding system required two parts – a cladding system and an external wall system. The Upper Tribunal was not prepared to narrow the interpretation of cladding system in this way. Again, it focused on the words used in Paragraph 8 of Schedule 8 which did not require two systems, merely, that the cladding system forms part of the outer wall of any external wall system. The Upper Tribunal decided the wording used is clear.
When deciding what was meant by "unsafe" the landlord sought to argue this would only include something which amounted to a fire risk. Following the theme of interpretation as outlined above, the Upper Tribunal found there was no need to narrow the interpretation in this way and the wording was clear. The ordinary meaning of unsafe should be applied when deciding whether the cladding system fell within the ambit of Schedule 8 of Paragraph 8. Before the FTT it was agreed between experts that the façade at Centre Point House needed remediation. In the past, parts of the system had fallen to the ground. The Upper Tribunal therefore agreed with the FTT in finding the system was unsafe.
Ground 5 – was the FTT wrong to determine the participating leaseholders benefited from the presumption that they held a qualifying lease?
The starting point is all leases are presumed to be qualifying pursuant to Paragraph 13 of Schedule 8 of the BSA if they meet the test in Section 119(2). Those holding qualifying leases are afforded protections by many of the provisions within Schedule 8, including but not limited to Paragraph 8 of Schedule 8.
The presumption applies unless the landlord under the lease has taken all reasonable and prescribed steps to obtain a leaseholder deed of certificate and no such certificate is provided to the landlord.
At the date on which the FTT heard the matter the landlord had not taken any steps to obtain the leaseholder deed of certificate and it therefore found that the presumption in Paragraph 13 of Schedule 8 applied.
The landlord appealed this decision on the basis that the FTT was wrong to decide that the presumption meant none of the participating leaseholders would have to contribute, as a service charge, the cost of the Scheme. This was because it had not heard any factual evidence from each of the leaseholders to decide if they met the test in Section 119(2) of the BSA.
The Upper Tribunal was not persuaded by this argument and dismissed the appeal. It said the FTT had not made any finding of fact but it had simply applied the presumption absent the landlord taking any steps to obtain the leaseholder deed of certificate.
Conclusion
The case is important as it looks at key concepts of what was meant by "cladding", "cladding remediation" and "unsafe". It provides much needed guidance on how the leaseholder protections operate when a building has an unsafe cladding system which requires remediation. It reiterates that cladding remediation will be treated differently to remedying relevant defects which will be time limited to the 30-year limitation period.
As a matter of statutory interpretation this decision provides a helpful reminder that it is important to look at the precise wording used in statute to decide what was intended by the draftsman. If the words are clear and unambiguous there is no need to import words or seek guidance from external aids.
It cannot be clearer, given this decision and recent Court of Appeal decisions, that the Court and Tribunal will do their utmost to uphold Parliament’s intentions to protect leaseholders from costs of remediation of dangerous cladding and poor workmanship which they had no part of.
Both leaseholders, landlord and developers will benefit from the decision since it provides much needed clarity on the extent of remediation and protection from costs.
Bhavini Patel at Howard Kennedy LLP acted for 10 of the successful respondents, with assistance from Daniel Barrett and Jenna Russell. We have a full set and dedicated Building Safety team at the firm who can help with a broad range of issues. Please get in touch with Bhavini Patel (bhavini.patel@howardkennedy.com) if you would like to discuss any building safety matters.
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