Part 5: Other provisions about safety standards, etc. Remediation of Certain defects Section 120 – Meaning of "relevant defect" Background
As described in the explanatory note to section 116, since the Grenfell Tower fire in 2017, it has become apparent that many blocks of flats have serious historical building safety defects which require often costly remediation. Most flats in multi-occupied residential buildings in England are owned as leaseholds, meaning that the building and the land which it is on are owned by a freeholder, and the long leases of the dwellings within the building are owned by the leaseholders. The freeholder is responsible for the safety and upkeep of the building. The terms of most leases, which are contractual agreements between the freeholder and leaseholder, allow the costs associated with maintaining the building to be passed through the service charge by the freeholder to leaseholders.
	The leaseholder protections provisions protect leaseholders by preventing or otherwise limiting the costs associated with historical building safety defects being passed through the service charge. Section 120 defines the defects which fall within the scope of the leaseholder protections.
	The leaseholder protections deal only with historical building safety defects; they are backward-looking only. They are a one-off intervention designed to deal with the current serious problems with historical building safety defects in medium- and high-rise buildings. The protections afforded only apply to defects created in the 30-year period prior to commencement of the provision, so in practice between mid-1992 and mid-2022. A 30-year period has been chosen as evidence shows that this period captures all buildings affected by the relevant safety issues. It aligns with changes this Act makes to the limitation period under section 1 of the Defective Premises Act 1972 (to which see section 135) and the relevant limitation period under the new cause of action relating to cladding products (sections 150 and 151). The Government has also agreed with major residential property developers that they will remediate buildings they had a role in developing or refurbishing in the past 30 years.
	Subsections (2) and (5) define what is meant by a "relevant defect" and set out that for a defect to be a relevant defect, it must give rise to a building safety risk. A "building safety risk" is one that puts people’s safety at risk due to either the risk of the spread of fire or structural collapse of a building.
	The definition of building safety risk mirrors the definition in section 62. The Independent Review focused on fire and structural safety risks and recommended that these were the initial scope for building safety risks in the new regime, as the spread of fire and structural failure represent the most serious risks to safety in and about buildings. This definition of building safety risk is mirrored for the purposes of the leaseholder protections, as fire and structural safety risks represent the most serious risks to safety in and about buildings and are therefore the risks that are most likely to need to be mitigated, often through costly remediation – the costs associated with which leaseholders need protection from.
	Section 62 includes a power to prescribe other matters within the definition of a building safety risk. Although it is not proposed to expand that definition at this time, that power gives important flexibility for the future regime in Parts 3 and 4 of this Act should new building safety risks materialise. The leaseholder protections are backward-looking only, in the sense that they only apply to historical building safety defects. They are a one-off intervention designed to deal with current issues associated with historical defects in certain buildings and so it is not necessary to mirror a power to expand the definition of building safety risk in this section.
Example 1
A fire safety risk in a high-rise building was created due to the installation of flammable cladding in 2005. The cladding gives rise to a fire safety risk, as it could put people’s safety at risk by accelerating the spread of fire. The cladding would fall within the definition of a relevant defect, as the defect was created within the past 30 years and gives rise to a building safety risk. The leaseholder protections would therefore apply to the costs associated with mitigating against the risk posed.
Example 2
A contractor built a medium-rise block of flats with defective foundations in 1995 which now need remedial work to mitigate against the risk of structural collapse of part of the building. The defects in the foundations fall within the definition of a relevant defect as the building was completed within the past 30 years and give rise to a building safety risk. The leaseholder protections therefore apply to the costs associated with remediating the foundations