Citation: [2026] EWHC 789 (TCC)
Claimants: Crest Nicholson Regeneration Limited, Crest Nicholson (South) Limited, Crest Nicholson Operations Limited and Crest Nicholson PLC V Defendants: Ardmore Construction Limited (In Administration), David Richmond and Partners Limited, Yuanda (UK) Co. Limited, Ardmore Construction Group Limited, Ardmore Group Limited, Ardmore Group Holdings Limited, Paddington Construction Limited, Ardmore Fitout Limited, Celebration Homes Limited and Byrne Properties Limited.
This decision of Constable J in the TCC is the first detailed judgment regarding the application of the “just and equitable” test in the context of making a building liability order (“BLO”) under section 130 of the Building Safety Act 2022 (“BSA”). It is the second recorded case of the High Court making a BLO. The first was made by Jefford J in 381 Southwark Park Road RTM Co Ltd v Click St Andrews Ltd (In Liquidation) [2024] EWHC 3569 (TCC). However, unlike here, in that case the defendants did not appear and were not represented.
The BLO sought by the Claimants (“Crest”) comprised two parts:
- First, Crest sought an ‘anticipatory’ BLO against the Fourth to Tenth Defendants (“the BLO Defendants”) making them jointly and severally liable for any liability that the First Defendant (“ACL”) may ultimately be found to owe to Crest under section 1 of the Defective Premises Act 1972 (“DPA”) or arising from a building safety risk within the meaning of section 130(6) of the BSA (“the Anticipatory BLO”).
- Second, Crest sought an order making the BLO Defendants jointly and severally liable for the sum of c.£14.9m awarded against ACL in an adjudicator’s decision (“the Adjudication BLO”).
The main facts can be briefly summarised as follows.
Crest is the developer and long leaseholder of 19 residential apartment buildings in a development known as Admiralty Quarter in Portsmouth (“the Development”). The Development was designed and constructed by ACL under a design and build contract (“the D&B Contract”).
Following the tragic fire at Grenfell, investigations into the external walls of the Development revealed fire safety defects (“the External Wall Defects”).
The First and Third Claimants (“CNR” and “CNO” respectively) each referred a dispute with ACL regarding the External Wall Defects to adjudication. The adjudicator decided that the External Wall Defects amounted to a breach of Part B of the Building Regulations and ACL’s duties under the DPA, and that ACL should pay CNR, alternatively CNO, c. £14.9m (“the Adjudicator’s Decision”).
ACL participated in the adjudication (albeit subject to a jurisdictional challenge and a claim that the adjudication breached the rules of natural justice).
ACL subsequently went into administration.
The sums awarded by the adjudicator were not paid. Crest therefore made an application to the Court for a BLO in the terms set out above.
By the time of the hearing, it was common ground that each of the BLO Defendants was an “associate” of ACL within the meaning of section 131 of the BSA.
There were three main issues for the Court’s determination. Firstly, whether an adjudicator’s decision could in principle give rise to a ‘relevant liability’ within the meaning of section 130(3) of the BSA, secondly, whether the adjudicator lacked jurisdiction and, thirdly, whether it was just and equitable on the facts to make the BLOs sought.
Before turning to the issues, Constable J distilled the authorities and other material referred to the Court as follows:
- the assessment of whether it is just and equitable to grant a BLO is a broad test and necessarily fact specific;
- the power is discretionary and should therefore be exercised having regard to the purpose of the BSA and all relevant factors;
- the power includes the ability to make an anticipatory BLO, that is a BLO which is ordered before a finding of any relevant liability;
- the purpose of section 130 of the BSA is to provide the Court with powers to allow those directly responsible for defective work which gives rise to a relevant liability for the purposes of the statute to be pursued through their associates. Whilst those powers may have the effect of removing the protections afforded by special purpose vehicles and shell companies, the purpose of the BSA should not be defined as in any way limited to being directed at special purpose vehicles and shell companies;
- the Court should not seek to limit or circumscribe the statutory test by setting out an exhaustive list of factors;
- it will generally be sensible for an application for a BLO to be case managed within the same proceedings as the main action which will determine the liability which is claimed to be the relevant liability for the purposes of the BLO;
- whether an application for a BLO should be determined in advance of, as part of, or indeed after, the liability hearing in the main claim will be a matter of case management. Ultimately, whenever the application is heard, it may only be acceded to where the Court concludes that, at the point it is making the BLO, it is just and equitable to do so.
As a result, when considering the BLO Defendants’ contention that it was premature to decide whether to grant a BLO, Constable J decided that it was plainly relevant for the Court to consider, by reference to the evidence available at the hearing, the likelihood that, after disclosure, witness evidence and expert evidence at trial, the Court would make a different order assuming a finding of a relevant liability against ACL. The greater the Court’s confidence that the same order would be made following a trial, the more inclined it will be to grant an ‘anticipatory’ BLO.
Applying the above, Constable J found in favour of Crest on the two main issues for the detailed reasons he gave. In short, he held that:
- An adjudicator’s decision could give rise to a ‘relevant liability’ for the purposes of section 130(3) of the BSA. Constable J rejected the BLO Defendants’ contention that a Court must itself be satisfied that there is a relevant liability before it can make a BLO. Adjudicator’s decisions are binding unless successfully challenged and there was nothing to suggest that the statutory regimes for adjudication and BLOs were mutually exclusive; they could effectively operate together. As a matter of procedure, it was not necessary to make an application for summary judgment to enforce the Adjudicator’s Decision. The Court is capable, on an application brought pursuant to section 130, of determining the existence of such liability when ordering (should it be just and equitable) its transmission to an associate.
- The adjudicator did not lack jurisdiction. In agreement with the decision of Joanna Smith J in BDW Trading v Ardmore Construction Limited [2024] EWHC 3235 (TCC), an adjudicator has jurisdiction to decide claims under the DPA. The adjudicator also had jurisdiction to award sums to CNO (as CNR’s undisclosed principal). If Constable J was wrong about that, it was possible to sever the determination that CNR was entitled to payment (and it was not in dispute that the adjudicator had jurisdiction to award sums to CNR).
- It was just and equitable to grant both the Anticipatory BLO and the Adjudication BLO based on the facts either as established by the evidence before the Court on the application or as were uncontroversial. The relevant facts were that: (1) ACL was in administration and did not have the means to satisfy any judgment against it; (2) ACL specifically entered administration because of its exposure to claims in relation to defects following the Grenfell Tower fire; (3) ACL is part of the Ardmore Group, which includes the BLO Defendants; (4) the Ardmore Group has been specifically restructured to ringfence ACL’s liabilities from those of other companies within the group; (5) all roads lead to Cormac Byrne (the person with ultimate control of ACL and the BLO Defendants) and/or the Byrne Family Trust. Further, on the evidence before the Court, Constable J was satisfied that (6) there can be no real dispute that the Development contains building safety risks within the meaning of section 131(6) of the BSA; (7) there can be no real doubt that ACL will be liable for those building safety risks. It was further established that (8) ACL has been alive to both Crest’s claim and third party claims for a long time; (9) there can be no real doubt that Cormac Byrne, and therefore the BLO Defendants, know all about Crest’s claims and have known for some time; (10) the BLO Defendants were sent formal pre-action protocol letters of claim almost a year ago, and they showed little interest in engaging; (11) Cormac Byrne did not submit any evidence on the application but did sign the statement of truth on the Amended Defence; and (12) there is an Adjudicator’s Decision for c£14.9m relating to the External Wall Defects that has gone unpaid.
While the Court made an anticipatory BLO now, it agreed with the BLO Defendants that it can leave to trial the question of whether any relevant liability would be the subject of a reduction by way of specified description on account of relative factual blameworthiness. Constable J thereby left open the possibility that, after trial, a Court may conclude that upon transmission to the BLO Defendants, the relevant (legal) liability should be reduced.
Accordingly, Constable J granted Crest both the Anticipatory BLO and the Adjudication BLO.
Counsel:
Jonathan Selby KC and Harriet Di Francesco were instructed by Gateley Legal
Simon Hughes, James Frampton and Connie Trendle were instructed by Rosenblatt Law
You can read the full judgment here.
