In the 1960s two large tower blocks were built using the Large Panel System (LPS). The LPS was a technique widely used at that time in which prefabricated concrete slabs were bolted together to form a building’s walls and floors. However the technique was prone to structural weaknesses and defects and, as a result, substantial works have been required over the years to correct overloading issues.
In 2020, the freeholder began further repair works which cost of £9.2 million. It then attempted to recover part of that cost from the leaseholders. Two leaseholders who had bought their flats under the right to buy legislation challenged that approach and the case reached the Court of Appeal.
The case centred around one clause in the lease which obliged the freeholder to do works necessary for the “proper management, safety, amenity or administration of the building” – with the cost of that work being recovered from the leaseholders via the service charge
The issue for the court was – does the word “safety” in this clause cover the cost of the works to remedy structural defects?
The judges looked at both the wider background (ie the fact that these were right to buy leases) as well as the meaning of the words in this particular covenant. The court decided that the word “safety” referred to issues such as dealing with a missing paving stone or defective lighting on the stairs. It was these types of “safety” issues which the clause covered rather than fundamental structural defects.
The leaseholders therefore escaped liability for any part of the costly repair works.
This case shows that the particular wording of any lease and the wider background are all relevant in establishing whether tenants are liable for the cost of any work under the terms of a particular lease.
Tower Hamlets LBC v Various Leaseholders of Brewster House and Malting House [2025] EWCA Civ 1591
