12 Days of Christmas 2025 – Day 5

Adriatic Land 5 Limited v Long Leaseholders at Hippersley Point / Triathlon Homes LLP v Stratford Village Development Partnership [2025] EWCA 846

On Day 5 of our 12 Days of Christmas feature, we treat you to a duo of appeal cases about the Building Safety Act 2022 ('BSA') which ended up being heard together in the Court of Appeal in March this year. Both cases related to the extent to which provisions of the BSA could be applied retrospectively.

The facts

In the Adriatic Land case, the building in issue was a 10-storey block of flats subject to long leases. Fire safety defects were discovered in 2020 requiring remedial work. Adriatic sought to recover the costs of these works from the leaseholders via the service charge. Adriatic did not follow the consultation requirements under the Service Charges (Consultation Requirements) (England) Regulations 2003 ('the Regulations') when undertaking the works. It was therefore necessary for it to obtain dispensation from the requirements of the Regulations in order to be in a position to recover the cost of the works from the residential tenants. The First-tier Tribunal granted dispensation, but ordered that the costs of the dispensation application would not be recoverable from the tenants. When Adriatic appealed to the Upper Tribunal, the judge held that paragraph 9 of Schedule 8 of the BSA (which had come into force after the works had been done and the costs incurred) prevented Adriatic from recovering the application costs from tenants. Adriatic appealed to the Court of Appeal stating that the BSA could not be applied retrospectively before 28 June 2022, when the relevant provisions came into force.

The Triathlon Homes case concerned fire safety defects which were discovered in five residential blocks at the East Village Estate, Stratford, London. These defects fell into the "relevant defects" definition under s 120 BSA. Initially, the Building Safety Fund was approved by the Greater London Authority to be used to assist with meeting the cost for replacing the cladding on the blocks. Triathlon, who hold several long-term leases in the blocks, applied to the First-tier Tribunal for remediation contribution orders (RCOs) (under s 124 BSA) to require SVDP and Get Living (SVDP's owner) to make payments to meet the cost of remedying the cladding. The First-tier Tribunal held that SVDP and Get Living should pay Triathlon for their expenses and pay future remediation to East Village Management Ltd (the estate's management company). SVDP and Get Living appealed to the Court of Appeal on the basis that:

1. It was not "just and equitable" to make the RCOs; and
2. The First-tier Tribunal erred in concluding that an RCO could be applied retrospectively to costs incurred before the relevant part of the BSA came into force.

The Court of Appeal decisions

Adriatic's appeal was dismissed by a majority decision (2 to 1) and the Court of Appeal held that paragraph 9 of Schedule 8 BSA has retrospective effect. Additionally, it was held that the costs of the dispensation application fell within this paragraph and could not be recovered via service charges from the leaseholders. The majority justices held that no service charge related to safety defects was payable by leaseholders whether the costs were incurred, demanded or fell due, before or after the 28 June 2022. Nevertheless, payments already made by leaseholders prior to 28 June 2022 would not be affected. The justices gave the reason that it was more likely that Parliament intended the BSA to protect leaseholders from unaffordable bills and restore market confidence in light of the Grenfell Tower tragedy. Landlords are also in a better position to fund the remedying of defects and are more able to claim remuneration from the original developers. Therefore, from 28 June 2022, landlords cannot recover service charges from leaseholders where the costs are for safety defects, even if the costs were incurred prior to the BSA coming into force.

In Triathlon Homes the Court of Appeal dismissed the appeal on both grounds.

1. The policy of the BSA is that primary responsibility for costs related to remediation should fall on the original developer and not onto public funding in the form of the Building Safety Fund, which should be a last resort. In this case, it was "just and equitable" as the developer responsible, who also retained an interest in the building should be at the top of the hierarchy regarding those who will pick up the cost.
2. The Court dismissed ground 2 referencing URS Corporation Ltd v BDW Trading Ltd [2025] where the Supreme Court was strongly in favour of section 124 BSA having retrospective effect. They also found it would be unfair and inconsistent if leaseholders who had paid for remediation before the BSA came into force were left without a remedy, while others were protected.

In summary, these cases confirm that the BSA has retrospective effect regarding payments for rectifying safety defects. However, paragraph 9 of Schedule 8 (regarding service charge) only applies retrospectively to payments that have not been already made before the BSA came into force, whereas section 124 (regarding RCO's) applies to payments already made as well.

And if you have made it this far, we reward your efforts with a festive joke: Why can't Santa spell "elf"? Because he has noel!