ACM CLADDING RECORDS

Essendi UK Hotels 2 Ltd v London Property Company Ltd

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categoriescladding, fire-safety, TCC, ACM, lease, landlord, fire-safety-order

Essendi UK Hotels 2 Ltd v London Property Company Ltd

[2026] EWHC 1354 (TCC) — TCC, 5 June 2026 (HHJ Stephen Davies, sitting as a High Court judge)

Judgment: [2026] EWHC 1354 (TCC) (National Archives)

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Issue

Category 3 ACM cladding with a polyethylene core — the same type used on Grenfell Tower — installed on a multi-storey hotel in 2005. London Property Company (LPC) acquired the freehold in 2018 and granted Essendi a new lease in March 2019 that post-dated the original lease’s defect “Cut Off Date” and placed no obligation on Essendi to remedy cladding defects. By 2024, investigations confirmed the cladding presented a significant fire risk; the hotel closed in July 2025 on expert advice that continued operation risked prosecution and severe life-safety risk. LPC disputed liability for remediation.

Essendi advanced three principal bases for requiring LPC to remediate:

  1. LPC’s covenant to keep the structure and exterior in good and substantial repair and condition.
  2. LPC’s obligation to comply with statutory requirements, particularly the Regulatory Reform (Fire Safety) Order 2005.
  3. (third basis not separately detailed in sources reviewed)

Outcome

  • LPC held in breach of both the “good condition” repairing covenant and the “legal obligations” covenant under the lease, by failing to remove and replace the cladding.
  • Specific performance ordered: removal of the cladding within 6 months, replacement within 18 months.
  • Essendi awarded damages for LPC’s breaches (quantum not yet determined at time of reporting) — the hotel closure accepted by the court as a reasonable consequence of LPC’s failure to remediate.
  • LPC’s counterclaim for an indemnity from Essendi dismissed.

Notes

  • Building: the Ibis London Wembley hotel — 16 storeys, 210 bedrooms, reclad 2005–06 with Reynobond ACM panels (category 3, PE core).
  • Confirms extensive building-safety remediation works, including wholesale cladding replacement, can fall within conventional repairing and statutory-compliance obligations in commercial leases — not just residential/BSA 2022 mechanisms.
  • Relevant to any leased or PFI-structured healthcare premises with ACM or other combustible cladding, where lease covenants (rather than the BSA) may be the operative mechanism.
  • Likely to be closely scrutinised across the property and construction sectors; judgment is recent (June 2026) and worth checking for any appeal.

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