Energy Performance Certificates: key dates - 1st October 2008
From 1 October 2008, an EPC will be needed for the construction, sale and rent of all remaining buildings that are not dwellings.
By way of reminder, since 6 April 2008, EPCs have been required for the construction, sale or renting out of non-dwellings with a total useful floor area over 10,000m² and since 1 July 2008, EPCs have been required for the construction, sale or renting out of non-dwellings with a total useful floor area over 2,500m².
If your property was already on the market before 6 April 2008 or 1 July 2008 respectively, and the property remained on the market after that date, you do not have to provide an EPC before exchange of contracts PROVIDED exchange takes place before 4 January 2009 (previously 1 October 2008) but once contracts have been exchanged, you must commission an EPC and hand it over to the prospective buyer or tenant as soon as reasonably practicable.
If your property is smaller than 2,500m² and you put it on the market before 1 October 2008 (and it remains on the market after that date), the same applies ie you do not have to provide an EPC before exchange of contracts PROVIDED exchange takes place before 4 January 2009 but again, once contracts have been exchanged, you must commission an EPC and hand it over to the prospective buyer or tenant as soon as reasonably practicable.
Certain types of building are exempt from the requirement to provide an EPC:
• Places of worship;
• Temporary buildings with a planned use of less than 2 years;
• Stand alone buildings with a total useful floor area of less than 50m² that are not dwellings;
• Industrial sites, workshops and non-residential buildings with a low energy rating; and
• Subject to satisfying certain requirements, the sale or rent of a building that is due to be demolished.
Remember that there are penalties for not complying. The level of the penalty charge varies according to the type of property in question. In most cases, the penalty for failing to provide an EPC when selling or renting out commercial property is 12.5% of the rateable value of the building, with a minimum penalty of £500 and a maximum penalty of £5,000. However, paying a penalty does not get you out of having to provide an EPC and successive penalties can be imposed.
AIR CONDITIONING INSPECTIONS
If you have air-conditioning in your building, you may be subject to obligations to have the air-conditioning inspected.
Part 4 of the Energy (Performance of Buildings) Regulations 2007 imposes an obligation on those who have control of air-conditioning systems to ensure that the system is inspected at least every five years by an energy assessor.
The person who controls the operation of the system is the person who controls the technical functioning of the system, not someone who does no more than adjust the temperature.
If you are a tenant and under the terms of your lease, you take total responsibility for a building and its services (e.g. full repairing and insuring lease), then you will ‘control’ the system.
Where the operation and management of the system is carried out on a day-to-day Facilities Management basis, or a servicing company provides routine servicing and maintenance, the contract may specify the FM or servicing company as the controller of the system with responsibility for ensuring that inspections are carried out. Depending on the terms of such a contract the FM or servicing company may accordingly become responsible under the regulations also. Even in such cases, however, the landlord or tenant retains a parallel duty to ensure the air conditioning inspection has been done.
Where air-conditioning systems are installed locally by you as a tenant, the responsibility will lie with you as you own the system.
If the system was put into service after 1 January 2008, the first inspection must take place within five years of the system being put into service.
If the system was in service before 1 January 2008, the date of the first inspection depends on the output of the system:
• systems with an output of more than 250 kW must be inspected before 4 January 2009
• systems with an output of more than 12 kW must be inspected before 4 January 2011
The penalty for failing to having an air-conditioning inspection report is currently fixed at £300. If you want to sell or rent out a building with an air-conditioning system which should have been inspected, the solicitors acting for the prospective buyer or tenant will ask for sight of report as part of the due diligence exercise before exchange of contracts. Failure to have a report where one is required could delay a sale or letting.
Further useful guidance on EPCs and air-conditioning inspections can be obtained from the Department for Communities and Local Government via their website: www.communities.gov.uk
For further information please contact:
Heloise Horton in our Property Support Team at our Nottingham Office:
Freeth Cartwright LLP, Cumberland Court, Mount Street, Nottingham NG1 6HH
Tel: 0115 936 9369
Fax: 0115 859 9641
Email: heloise.horton@freethcartwright.co.uk
The information contained in this alert is a general summary and commentary on recent developments and does not constitute advice.
You must take specific legal advice in relation to any of the issues raised here in terms of the impact they may have on you.