This Supreme Court judgment has important implications for all future claims relating to historical defects within residential developments. Clarity is provided on statutory duties owed under s.1 of the Defective Premises Act 1972 (“DPA”) and how the extended limitation period introduced by s.135 of the Building Safety Act 2022 (“BSA”) applies retrospectively. The Court’s ruling sheds light on the legal rights and responsibilities of developers when historic building safety defects are uncovered and the point at which they might seek to bring an onward claim for contribution to remedial costs.

Background

The respondent, BDW Trading Limited (“BDW”) engaged the appellant consulting engineers, URS Corporation Limited (“URS”) to carry out structural design work in connection with a series of tower blocks. In 2019, BDW discovered design defects within two sets of multiple high-rise residential building developments (“the Developments”) for which URS had provided structural designs.

Despite no longer having any proprietary interest in the Developments, BDW carried out remedial works to them in 2020 to 2021. No claim had been made against BDW by the owners or occupiers and such a claim would – or so it was thought at that stage – have been time-barred. After both the Technology and Construction Court and Court of Appeal unanimously found in favour of BDW on a crucial set of preliminary and procedural issues, URS appealed to the Supreme Court.

Held

The Justices of the Supreme Court were in unanimous agreement that each of URS’ four grounds of appeal should be dismissed.

The following grounds of appeal raised by URS were considered by the Supreme Court:

1. Did BDW suffer actionable and recoverable damage? If not, did BDW have an accrued cause of action when they sold the Developments?
2. Did s.135 BSA apply and, if so, what was its effect?
3. Did URS owe a s.1(1)(a) DPA duty to BDW and, if so, were BDW’s losses recoverable?
4. Was BDW entitled to bring a contribution claim against URS?

For a full discussion on the Supreme Court’s reasoning and rulings, please read our extended bulletin in the link below.

Analysis

This landmark decision provides welcome and important guidance on the retrospective extension to limitation introduced by s.135 of the Building Safety Act 2022 and when s.1(1)(a) duties will arise under the Defective Premises Act 1972. Further, the test for when a party was able to commence a contribution claim was clarified.

It is also significant that the Supreme Court declined to overturn Pirelli. The long-debated issue over whether reform is needed to dispel uncertainty as to when the cause of action accrues in negligence claims will therefore continue. Despite this, the Supreme Court has strongly hinted that Pirelli’s influence over the Courts will reduce and its application will be restricted.

Have concerns or need more clarity on these topics? Don’t hesitate to get in touch. Our team is on hand to offer clear and commercial legal support.

To download the bulletin, please do so here.

This article contains information of general interest about current legal issues, but does not provide legal advice. It is prepared for the general information of our clients and other interested parties. This article should not be relied upon in any specific situation without appropriate legal advice. If you require legal advice on any of the issues raised in this article, please contact one of our specialist construction lawyers.

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