James Furber
Home Office figures show that local authority fire brigades attended 447,000 fires in 1984. While the total of deaths caused by these fires was at its lowest level since 1977, the number of non-fatal casualties reported was 11,000, the highest yet recorded. These figures emphasise yet again the necessity for fire precautions in all types of building and the need for the professional property manager to be aware of such necessity and the legislation that regulates it.
The problems arising from the Fire Precautions Act 1971 (“the Act”) for the property manager are numerous, although there are probably three main causes of difficulty.
First, while there is a general awareness among occupiers and owners of commercial property of the need for fire certificates and fire precautions, this is not matched with a detailed knowledge of the legislation, which has sprung up from many sources, culminating in the Act.
Second, most modern commercial leases place the responsibility for all works required by statute (whether actually doing them or paying for them) on tenants; because of this, in the eyes of most landlords their burden under the Act is shifted to the tenant. The tenant meanwhile assumes that the landlord has ensured that his building is safe and complies with the Act.
Third, the cost of complying with the Act can be very high and neither landlord nor tenant may be eager to disrupt working conditions and spend money on precautions for something they hope will never happen.
All these elements can leave the property manager as an unwilling “man in the middle” caught between the conflicting interests and duties of landlord, tenant and fire authority.
For the purpose of this article I shall concentrate on commercial buildings in multiple occupation as affected by the Act and try to highlight elements from these three areas of difficulty of which property managers should be aware.
Who is responsible?
Because of the way that the legislation has arisen, there is some confusion as to who is actually responsible for works required by the Act.
The person liable to carry out works to a building in multiple occupation (and also, therefore, the person who can be penalised if such works are not carried out) is, under the Fire Precautions Act 1971 (Modifications) Regulations 1976 (SI 1976 no 2007), “the owner” of the building, where the building is split up into premises let but all parts of the building are under the same common ownership. In the less common circumstances where parts of a building are owned by different persons, then it is the persons who between them own the building who become “the owner”.
In a building in single occupation, it is “the occupier” who applies for a fire certificate, be he freeholder or leaseholder.
The effect of the statutory instrument was to enable fire authorities to deal with the owner in respect of structural requirements leading up to the issue of a fire certificate. It also made the owner responsible if the premises were used without a fire certificate, and also for notifying the fire authority of proposed material alterations to the property.
The definition of “owner” is “the person for the time being receiving the rack rent of the premises whether on his own account or as agent or trustee for another person who would so receive the rack rent if the premises were let at a rack rent”. Prima facie, therefore, the owner includes the rent-collecting managing agent.
Having spoken to the Home Office, who are responsible for this legislation, and discussed with them the fact that this definition clearly includes managing agents as collectors of rack rent as agents for another, I was told that the Act was not intended to make managing agents primarily liable for offences under the Act. Nevertheless, this is what the Act says and I cannot see that the definition of “owner” is open to any other interpretation.
Since penalties for non-compliance with the Act can be severe (on indictment these may involve a possible prison sentence in addition to a fine) and one must also consider the damage to professional reputation that an indictment might have, managing agents will be concerned to ensure that their positions are secure, both by obtaining suitable indemnities from their principals and by ensuring that the premises they manage comply with the Act.
To a certain extent the diligent and competent managing agent is given defences under the Act in the case of prosecution.
The first of these defences (section 24 of the Act) provides that where a contravention of the Act (or regulations made under it) for which a person is liable to a penalty is due to the default of some other person, then that other person should be guilty of the offence, and indeed that other person may be charged with the offence without the first person being charged.
This, of course, is two-edged in that it might be the fault of the managing agents that works have not been carried out, having been urged to do so by their principal.
The second defence (section 25) provides that, in any proceedings for an offence under the Act, it shall be a defence for the person charged to prove that he took all reasonable precautions and exercised all due diligence to avoid the commission of an offence.
Potentially this defence is of less assistance to the managing agent than the first defence.
Shifting the burden of responsibility for works
There have been statutory provisions for many years (s7(2) of the Factory and Workshop Act 1891, s107(1) of the London Building (Amendment) Act 1939 and s73(2) of the Offices, Shops and Railway Premises Act 1973) that dealt with the courts’ powers to order contributions towards the cost of means of escape from commercial premises notwithstanding the terms of the agreement between owner and occupier (see Horner v Franklin [5] 1 KB 479).
The successor of these provisions is section 28 of the Act which (as modified) permits, in the case of premises forming part of a building in multiple occupation, anyone who is prevented by the terms of their lease from doing works necessary to get a fire certificate to apply to the county court for an appropriate order to carry out the work. Perhaps more important, it is also provided that an application may be made to the county court for the expense of work to be met by some other person having an interest in the premises and for modification of the terms of any agreement or lease relating to the premises as to the expense.
Thus a tenant may apply to the county court for modification of his lease if all the costs of all works are placed upon him and he is aggrieved by this and feels that the landlord should be contributing towards the cost of these works notwithstanding the terms of the tenant’s lease, and of course on the assumption that he can persuade the county court judge to agree with him.
On inquiring from the Lord Chancellor’s Department as to how many applications are made a year under section 28 of the Act, I discovered that the number of applications was so minimal as not to warrant a record being kept. Certainly, I personally have come across only one such application to the county court (which was settled), but occasionally when acting for tenants the possibility of such an application can be mentioned in an effort to produce a more equitable sharing of costs than the terms of the lease dictate.
What degree of success a tenant might have in any such application must, I feel, depend on the relative interests of the two parties in the premises, eg at the beginning of a 25-year term a county court’s attitude will be rather different from that towards the end of the term.
Failure to comply with the Act
The effect of failure to comply with the Act when this is discovered by the fire authority is that the use of a building may be completely sterilised, with consequently disastrous effects in terms of rent and use for both landlord and tenant.
If a landlord can show that works required by the Act are the responsibility of its tenant under the lease, then this may be one of the circumstances where a mandatory injunction might well be granted by the courts, forcing the tenant to carry out the works required. The courts have been unwilling to grant such mandatory injunctions in respect of works, but following Redland Bricks Ltd v Morris [0] AC 650 they may well now do so because:
(1) The landlords will be able to show that “grave damage” may accrue to them if the works are not done (eg a prosecution under the Act);
(2) Damages are not a sufficient remedy;
(3) The tenant knows exactly what he has to do to comply as a matter of fact (the fire authority will have made this clear); and
(4) The court will not be involved in prolonged difficulties of enforcement or supervision, since to a large extent the works will be “policed” by the fire authority.
To proceed against a tenant for forfeiture of the lease after serving appropriate notices under section 146 of the Law of Property Act 1925 is probably not the course of action that a landlord would want to take in the case of works relating to fire precautions. Such proceedings take some time to be brought to trial and during that time there is always the possibility that the landlord, as owner, will be being prosecuted under the Act for permitting the premises to be used in contravention of the terms of the Act. While the owner might well have one of the defences mentioned above, most landlords would prefer to see the premises made safe and usable, at the expense of the tenant, rather than go to the expense of obtaining possession of premises which, until further works are carried out, cannot be used for their intended purpose.
The continuing burden on the managing agent
Given these areas of difficulty, the first step of a managing agent of a property in multiple occupation must be to get in touch with the local fire officer and find out the terms of the fire certificate affecting the premises, no matter how complicated or lengthy a document it may be, and then communicate such terms both to owner and to tenant.
If no fire certificate exists then one should be applied for straightaway, since property owners will expect managing agents to deal with the Act as it affects their property. Having leapt the first hurdle of applying for a fire certificate, or ensuring that a fire certificate is in existence, the agent’s second hurdle is to comply with the requirements, once they are known, of the fire authority in respect of works that are necessary either for the issue of a fire certificate or to bring the premises back into line with an existing certificate.
Frequently the fire authority are seen as a thorn in the side by both landlord and tenant because the fire authority are not concerned with commercial considerations, and the works that need to be carried out affect convenience of use and security in a building by requiring, for instance, that final exits be kept open and fire-resisting doors closed. (How common it is to see self-closing doors held permanently open by the nearest heavy object, quite frequently a fire extinguisher!)
In this area of conflicting interest, the managing agent must ensure that he knows exactly what liabilities he is taking on.
This can be done only by becoming familiar with the contents of the fire certificate covering the premises managed as to use, means of escape, means of fighting fire, number of persons permitted and so on, and also by making sure in dealing with the tenant’s request for alterations, change of use, storage of materials and so on that the terms of that fire certificate are not breached.
