The failure to inform the buyer was due to lack of communication between the agent’s lettings team – who had the information – and the sales team, who were selling another flat in the same building.
Reading Borough Council brought a prosecution after the agent’s lettings team failed to pass the results of an inspection to their sales team, meaning the buyers were not made aware of the ACM – similar to the cladding found on Grenfell Tower – until after they had completed the purchase. Had they been aware of the ACM, the buyers claimed, they would have withdrawn from the sale.
In addition to the property in question – a private flat in Hanover House, Kings Road – the agent also let several flats in the same building. On 3 November 2017, an inspection of Hanover House found that the building’s cladding contained ACM. The agent received the information on the day of the inspection, some two weeks before the sale was completed, but the information sat with the agent’s lettings team and was not shared with the sales team.
The sales team became aware of the ACM issue on 16 November, at which point they attempted to seek advice from Savills, who had instructed them on behalf of the owner. The sale was completed on the following day. Half an hour after collecting the keys, the buyers were told by the agent’s sales team about the ACM.
As ACM is not highlighted in regular conveyancing, the only way the buyers could have found out about this information is from the seller or the agent. No Government agreement was in place to deal with ACM cladding at the time. Facing unknown costs that could have run into tens of thousands of pounds, the buyers complained to Reading Borough Council’s Trading Standards team.
The agent acknowledged their error, pleading guilty at the earliest opportunity. In mitigation, it offered the firm’s previous good character, that it had compensated the buyers for management fees and loss of car parking, co-operated fully with the investigation and that a Government scheme was now in place that should manage the costs of replacing the cladding. They have also taken action to improve communications between its lettings and sales teams.
The agent was fined £30,000 and ordered by magistrates to pay costs of £2,646 and a victim surcharge of £170.
Grenfell Inquiry Phase 1 Report
The long-awaited phase one report on the public inquiry into the fire at Grenfell Tower on 14 June 2017 was released in October 2019. Amongst the recommendations in the report, putting evacuation plans in place for all high-rise buildings is paramount. The phase one of the inquiry has been limited to the events during the night of 14 June 2017 and much work remains to be done. It has already become clear that some important steps need to be taken to improve fire safety in high-rise buildings.
