Leaseholders in an apartment block covered in Grenfell-style cladding have been ordered to pay £500,000 to make their building safe after a tribunal ruled that they, rather than the management company, were obliged to cover the costs.
The ruling, which could be challenged, means leaseholders of the 95-apartment Citiscape complex in Croydon, south London, may face a £2m bill, which some have said would force them into financial ruin.
The building is owned by the family trust of the multimillionaire property mogul Vincent Tchenguiz, but the case was brought by FirstPort Property Services property management company, seeking clarification on who should pay.
Soon after the Grenfell Tower fire it was estimated that the cost of replacing the combustible cladding was about £500,000, but it later received estimates that the cost could be up to £2.4m.
Leaseholders had insisted that replacing the cladding should not be added to their service charge as it was not a matter of disrepair “because the cladding remains as designed and constructed”, and it did not fall under “periodical expenditure”.
One resident, Richard Low-Foon, told the tribunal he needed “a miracle” to fund the works as his father was ill and could not sell his flat because of the risk the building carried for any future investor. “He is in hospital because of all this. It got too much for him,” he said.
However, the chairman of the London residential property first tier tribunal, Angus Andrew, ruled against the leaseholders, insisting they should pay because “if the manager is obliged to do work … the tenants are obliged to contribute to the cost although they remain entitled to dispute the reasonableness of the cost”.
The ruling will be closely watched by thousands of other leaseholders in at least 130 private apartment complexes in England that failed cladding tests after the fatal fire in June.