Much has been made of the new Building Safety Act (BSA), introduced last October, and rightly so as it introduces a raft of new responsibilities for building owners that need to be reviewed and implemented.
However, the small but crucial Section 161 seems largely to have passed under the radar while people have been getting to grips with the operative provisions of the BSA.
Pursuant to Section 161, where an offence under Part 2 or Part 4 of the BSA is committed by a corporate entity with the “consent or connivance of any director, manager, company secretary or other similar officer” or the offence is caused by the “neglect” of such an officer, then they can be held personally liable for the offence alongside the company.
Those at board level will be caught by this, so it is imperative for organisations to consider what they can do now to best prepare and ensure compliance with the BSA. Organisations should identify the obligations that arise under the BSA (and the Building Act 1984) and who is responsible for discharging such obligations and how.
They should also implement a process of monitoring completion and the adequacy of each action. Documenting these steps is a vital and ongoing process.
Offences under Part 2 are concerned with withholding or providing misleading information to the Building Safety Regulator. Part 4 specifically relates to duties in relation to higher-risk buildings, and offences relate to matters such as allowing occupation without the relevant completion certificate and failure to display correct notices and certificates.
It is crucial to start conversations with your insurance brokers with regard to directors’ and officers’ liability insurance (or other policies that may be available) to see if they will provide coverage for such offences, and what requirements they will insist on to ensure adherence.
It remains unclear how the insurance market will react to providing cover for such risks, which is likely to be influenced by market conditions and insurers’ risk appetite at any given time.
Kathryn Kligerman is partner at law firm Devonshires
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