Rendlesham Estates Plc v Barr Limited (2014) CILL 3604. TCC, Edwards-Stuart J
Barr Limited constructed 2 apartment blocks in Leeds. There were funding problems so economies were made. Within a couple of years of completion, there were leaks, mould and condensation in various of the common parts of the 2 blocks. The developer went into administration and the owners therefore brought proceedings against Barr under Section 1 of the Defective Premises Act 1972 as the dwellings were not fit for habitation, claiming £14m to substantially re-build the external envelope of both blocks.
- The common parts did not form part of the “dwellings” for the purposes of the Act, but
- it was not only the work done to provide the dwelling which is covered by the Act but also work done “in connection with the provision” of a dwelling which is covered. The Judge regarded this as bringing all the common parts within the operation of the DBA. Unfitness for habitation therefore extended to the common parts of the apartment blocks.
- The Judge listed a number of criteria to be considered in considering whether either a dwelling or the common parts relating to a dwelling were “fit for habitation” including:
- was the dwelling on completion capable of occupation for a reasonable time without risk to health or safety (reasonable time is a question of fact);
- was the dwelling also capable of occupation for a reasonable time without undue inconvenience or discomfort;
- can the means of access such as stairways or lifts be used safely and without undue inconvenience or discomfort;
- is the dwelling fit for habitation by all the classes of people who might reasonably be expected to occupy including pregnant women, babies, children and those suffering from common ailments and allergies such as asthma;
- where there are a number of defects, one should consider them altogether, and their cumulative effect;
- fitness for habitation should be judged at the time the dwelling is constructed;
- merely cosmetic defects cannot give rise to liability;
- the presence of mould or damp, if persistent and more than minor, renders an apartment unfit for habitation;
- poor subsequent maintenance by a third party is not sufficient to render an apartment unfit for habitation when completed but if the defect is so bad as to make maintenance a waste of time or ineffective, then the duty will be broken;
- serious inconvenience which is more than transient can itself making the dwelling unfit for habitation (e.g. a lift which repeatedly breaks down could make dwellings on the upper floors of an apartment block unfit for habitation); and
- a latent risk of failure within the design life of the building can constitute a breach.
This case provides a useful guide to a number of issues which arise in fitness for habitation disputes. Damages for distress and inconvenience, for example, were awarded at £750 per person but where there was also damp and mould, the figure was £2,250 per person per annum.
The Court also directed that judgment could only be enforced once against Barr, and on condition that the damages were paid to the solicitor for the claimants who had to give an undertaking to the Court to hold the money for the benefit of the management company to enable it to carry out the repairs.
The measure of damages was the cost of repairs, but there was also provision for people who had lost money through blight upon the value of their properties to be compensated.
Barr tried to cut down its exposure to damages for repair of the roof by arguing that as only a limited number of the tenants on the upper floors had claimed, Barr should only pay for a part of the roof repair costs. The Court dismissed this in a decision which has very significant implications for the resident associations of multi-occupancy buildings. The Court would not let the contractor escape the consequences of its breach by this technical argument.