URS Corporation Ltd (Appellant) v BDW Trading Ltd (Respondent) [2025] UKSC 21 is one of the most important construction cases to be heard by the Supreme Court in recent memory, and provides some valuable insight into how the courts are likely to approach issues arising under the BSA going forward.
The case concerned developments that had been carried out by BDW in the late 2000s. A number of the buildings had been found to contain alleged structural defects, which were assumed to have been safety-critical. Upon discovery of the defects, BDW pro-actively carried out temporary propping followed by remedial works, without any claims having been made against it (indeed, BDW itself having been the party to discover the defects in the first place). It sought to recover its costs of doing so from URS, the engineer responsible for the relevant structural designs. Claims were then made by BDW to recover its losses in negligence and, following the coming into force of the BSA, also under the Defective Premises Act 1972 (“the DPA”) and the Civil Liability (Contribution) Act 1978 (“CL(C)A”). In doing so, BDW relied upon the retrospective extension of the DPA limitation period from 6 to 30 years for historic claims that had been brought about by s135 of the BSA.
URS argued that it could not as a matter of law be responsible for losses suffered by BDW as a result of what URS said were BDW’s own voluntary actions. It also contended that BDW as a developer could have no direct cause of action under the DPA, and that BDW had no cause of action under the CL(C)A in the absence of any claim that had been the subject of an ascertained liability by way of admission, settlement agreement or judgment. Further, whilst s135 of the BSA might have retrospective effect for the purposes of enabling previously time-barred claims under the DPA to be pursued, URS argued that this was the limit of any such retrospectivity—s135 did not ‘change history’ or result in other claims being revived which depended on the collateral application of the revised limitation period under the DPA.
The Supreme Court, however, disagreed with URS on all fronts.
As to the claim in negligence, first ignoring the impact of s135 of the BSA, the Court understandably lacked sympathy for any argument that URS, as the party ultimately responsible for the assumed safety-critical defects, should not be expected to shoulder the costs burden of the necessary remedial works. There was no bright line rule of law, as URS contended, that expenditure incurred ‘voluntarily’ could not ground a claim in damages for negligence. Rather, ‘voluntariness’ was a factor relevant to a consideration of causation and mitigation, which would ultimately turn on the particular facts of each case and depend upon the reasonableness of the actions taken. On the assumed facts of this case (which will frequently arise in the context of cladding remediation), the Supreme Court made clear in any event that BDW was not acting ‘voluntarily’, as a result of the potential consequences of not acting and the moral pressure on BDW to effect repairs, as well as the fact that BDW did have a legal liability to homeowners under the DPA (regardless of the existence of a procedural time-bar).
As to s135 of the BSA, the Court had little difficulty in applying the clear wording of the statute in concluding that the retrospective extension of the limitation period from 6 to 30 years for historic DPA claims is to be treated as always having been in force. That is so whether the question of whether a DPA claim is or has ever been timebarred arises in the context of a direct claim under the DPA itself, or in another context where the DPA limitation period is relevant (such as in the context of a claim in contribution). This was also consistent with one of the key aims of the BSA, which was to ensure that those directly responsible for building safety defects are held to account. This did not mean, however, that the retrospective change in law would affect a consideration of the reasonableness as a matter of fact of BDW’s actions, at the time at which they were taken.
Of particular significance for the industry is the Court’s confirmation that BDW, as the party to whose order the dwellings were provided, was owed a duty under s1(1) (a) of the DPA. This was so regardless of the fact that it also owed duties under the DPA in accordance with s1(4). In addition, the fact that BDW had long-since sold its proprietary interest in the dwellings was no bar to recovery under the DPA in circumstances in which the relevant remedial works had been carried out at BDW’s cost in any event. Given the significantly extended limitation period under the DPA, as well as the fact that any attempt to exclude liability for DPA claims will be void, such claims are likely to become an important tool on the developer’s arsenal going forward.
Finally, the Court confirmed that the simple fact of having carried out the remedial works was sufficient to ground a claim in contribution (assuming that the other requirements of the CL(C)A can be established, namely the existence of a common liability for the same damage). This is obviously right as a matter of principle—it would be an odd state of affairs indeed if the indolent developer sued to judgment were to have the benefit of a claim in contribution against its supply chain, but the pro-active developer were not.
Accordingly, the Court has provided a clear steer that those ultimately responsible for building safety defects can expect to bear the cost burden of fixing them, and the case represents an important victory for those who have ‘done the right thing’ without waiting to be forced to do so.
David Sheard appeared in the Supreme Court for the Respondent in URS v BDW.
