Boiler- 12th October 2020
Update for Leaseholders
As you will be aware, we have been chasing leaseholders to have your boilers serviced for some time. This matter became extremely urgent and worrisome in September when we could only get one insurer to quote to insure us and that insurer placed an exclusion on our policy in respect of all Houses in RTM1, that states that no cover will be provided for any damage caused by a boiler that breaks, where that boiler has not been properly serviced within 12 months of breaking.
The reason for that exclusion and the reason why no other insurer would quote, is the recent claims we have had to make where an un-serviced boiler has blown causing catastrophic water damage to blocks. In one case leaseholders have had to be moved out and it has taken many months to repair the damage, with the current costs exceeding £350,000 on that claim alone. In total there were 10 claims made for similar damage caused by boilers.
We have asked leaseholders previously to have their boilers serviced. The provisions in the 8th Schedule to your lease state that leaseholders must keep all fixtures and fittings in good and substantial repair order and condition at all times. An un-serviced boiler that blows due to lack of maintenance would not satisfy such requirements.
The response to our previous requests has been at best poor and less than half of leaseholders responded with copies of their servicing certificates. The insurance exclusion meant that everyone was suddenly at risk from a boiler that was not serviced, even if they had had their own boiler serviced. The insurer would not pay out for any damage.
We began to get emails from extremely anxious and worried leaseholders who quite rightly feared that their apartments would be damaged by those above them, at no fault of their own, but would not be covered by insurance. We were being asked to be more than a little forceful in ensuring everyone got their boilers serviced so nobody would be at risk.
One boiler has broken and caused damage since this exclusion was put in place. Fortunately, it only damaged the leaseholders own apartment. The boiler had not been serviced in the last 12 months and therefore there was no insurance cover and the leaseholder is left to sort out the damage themselves at their own cost.
What we have done
We have approached this problem in a number of ways.
- We have engaged with specialist engineers and suppliers to see if there is a product on the market that can be fitted either in every apartment or in riser cupboards on each floor to automatically switch off water if there is a major leak. Our insurance broker, service engineers on site and a number of companies who make such devices are trying to see what we can do and what it might cost. There is an inspection and survey on site later this week
- We have commissioned a bespoke IT system to record and hold all certificates we receive from leaseholders for serviced boilers. It will be developed to automatically send out reminders to leaseholders before their certificates run out. We are already using it just to target those who have not yet sent in their servicing certificates
- We have taken a somewhat firmer tone and stance towards those who have either not responded at all or have not yet got their boilers serviced. We know this has upset a few of you, but our previous correspondence just wasn’t cutting it and many of you remained at huge risk. We have pointed out that in our view (and supported by legal advice) leaseholders who have not serviced their boilers may be in breach of their leases. Our thanks to a number of solicitors on site who have written to us pointing this out and supporting our interpretation.
The latest email we sent out to those who we had not received servicing certificates from had a dramatic effect. As a result we had dozens and dozens of responses, many with certificates, others saying they had now arranged servicing to be undertaken. At last, we also had agents responding and sending in certificates. As a result we have now received a total of 550 Servicing certificates. But that does mean we still have 350 Leaseholders who have either just not responded or are awaiting services to be undertaken. Leaving many leaseholders still at risk.
We have as a last resort looked at the powers we may have under the lease, to enter apartments to ‘view the condition’ of fixtures and fittings; to give notice specifying any ‘repair or works necessary to be done’; and should a leaseholder not comply, to ‘enter and cause such repairs or works to be executed’ and costs re-charged to the leaseholder. We really do not want to have to do this. It will be legally and administratively a real headache. But ultimately, to protect leaseholders, we may have to do this.
We do hope that all leaseholders will simply have their boilers serviced and send in the certificates. Alternatively, we will try to find a practical solution to deal with leaks. This will cost leaseholders money, albeit it may then reduce our annual insurance costs that have increased significantly because of this issue. We will keep everyone updated on progress.
If you have not yet sent in your boiler servicing certificate please do so now. If you have already sent in your certificate, you do not need to do anything else.
Owein Mattey Steven Corner, Elize Ferner,
Warwick Estates Mark James CBE, Stephen Kass
Development Manager Your RTM Directors