Keith Emmerson, associate in dispute resolution specialising in construction at Gillespie Macandrew LLP, discusses the potential implications of Scotland’s planned cladding remediation bill
The Scottish Parliament has published its long-awaited Housing (Cladding Remediation) (Scotland) Bill. This has taken considerable time to materialise, considering that the Grenfell tragedy occurred over six years ago, and the equivalent English legislation passed into law in April 2022.
The key provisions of the bill are the creation of a ‘Cladding Assurance Register’ (CAR) granting of powers to assess and address danger; and the creation of a ‘Responsible Developers Scheme’ (RDS).
The bill provides that buildings:
• constructed or redeveloped between 1 June 1992 and 1 June 2022;
• containing at least one residential flat;
• over 11 metres high; and
• having an external cladding system
should have a ‘single-building assessment’ (SBA) carried out. This assessment should identify any risk to life caused by the cladding, and the work required to eliminate or mitigate it.
Such buildings can then be registered in the CAR provided that the SBA has been carried out, and any necessary work identified has been completed. The CAR is therefore intended to provide comfort to anyone buying a flat in such a building.
The power to arrange SBAs in the bill rests with Scottish ministers, but this is not framed as an obligation, so as the bill is currently drafted, SBAs will not be mandatory. The bill goes on to grant powers to require information reasonably required for carrying out an SBA or maintaining the CAR, and to arrange remediation work (including the power to remove occupants from the building).
These powers are fairly broad, and failure to comply with any requirements of the Scottish ministers carries potential criminal sanctions.
It is worth noting the date range for the potentially affected works – June 1992 to June 2022 which means that some of the works which will be subject to an SBA may be over 20 years old. In terms of existing Scots legislation, any claim for defective works or negligence in specifying defective cladding for use would cease to be enforceable after five years.
The point at which the five-year clock for a claim commences is the subject of substantial case law, which is beyond the scope of this article. However, it is clear that there is the potential in the bill for construction professionals to be called upon to carry out or pay for remedial works, where their obligation to do so would have otherwise expired. The bill does not acknowledge the potential conflict with the existing legislation.
The RDS is intended ‘to secure that persons in the building industry address, or contribute towards the costs of addressing, risks to human life created or exacerbated…by…external wall cladding systems’. In simple terms this means to hold the installers of cladding systems to account for any remedial work that may be required.
The bill provides that eligibility for membership is to be made by regulations. The RDS is set out in the bill as a voluntary, opt-in scheme, which at first sight makes it seem akin to the Considerate Constructors Scheme, a scheme for like-minded construction professionals working together for the greater good. However, the bill also sets out the proposed consequences for not being a member of the RDS.
The party operating the RDS is to publish a list of those eligible for the scheme who have opted not to join, which it defines, rather ominously, as a ‘prohibited developers list’. The definition of those who may be eligible includes anyone ‘carrying on, for business purposes, activities connected with the construction of buildings’. This will therefore potentially affect more than just contractors; architects, quantity surveyors and engineers may also be caught by the legislation. The consequences of appearing on the list may be severe. Those who find themselves ‘named and shamed’ may be prohibited from:
• carrying out ‘any development’ or any specific kind of development set out in the regulations;
• obtaining grant or amendment of a building warrant; and/or
• obtaining a completion certificate.
Breach of these prohibitions may carry criminal sanctions and substantial fines. All of a sudden, the RDS seems much less like a voluntary scheme and more of a three-line whip.
The Housing (Cladding Remediation) (Scotland) Bill is borne from laudable intentions and response to a significant and high-profile tragedy. However, as currently drafted, there are a number of issues which need to be addressed.
Of particular concern for construction professionals is the potential ramifications of not signing up to the RDS, while the legal profession should be looking with interest at how historic claims, which would otherwise have prescribed, will be handled.
Consultation on the draft bill closed on 8 December 2023; one hopes that these issues will be addressed as part of this.
