URS Corporation Ltd v BDW Trading Ltd [2023] EWCA Civ 772

In its recent decision in URS Corporation Ltd v BDW Trading Ltd, the Court of Appeal has provided important guidance in respect of construction law questions old and new.

The Background to the Appeals

The respondent, BDW Trading Limited (“BDW”) had engaged the appellant consulting engineers, URS Corporation Limited (“URS”) to carry out structural design work in connection with a series of tower blocks (the “Properties”). Upon the discovery of alleged dangerous inadequacies in the structural design of the Properties, BDW commenced proceedings in negligence against URS on 6 March 2020.

URS raised certain Preliminary Issues, which were decided against it at first instance. The most important of these concerned the date of the accrual of a cause of action in tort against designers of a defective building, in circumstances where the defect caused no immediate physical damage (this gave rise to URS’ “Substantive Appeal”).

Following the coming into force of the Building Safety Act 2022 (“BSA”), BDW obtained permission to amend its statements of case to take advantage of the longer limitation periods identified in the BSA, and to add claims under the Defective Premises Act 1972 (“DPA”) and Civil Liability (Contribution) Act 1978 (“CLCA”) (this triggered URS’ “Amendment Appeal”).

The Substantive Appeal

The first ground of appeal was dismissed as it was decided that at the time the design work was carried out, URS owed BDW a full, conventional duty of care. URS had been wrong to suggest that this was somehow discharged when BDW subsequently sold the buildings.

The second ground of appeal was also dismissed on the basis that BDW’s cause of action in tort against URS accrued, at the latest, on practical completion of the buildings. Knowledge of the existence of that cause of action having accrued was irrelevant.

The Amendment Appeal

The several ground of appeal raised by URS were each dismissed, with the Court holding that:

• The judge had exercised his discretion correctly in managing the case and the correct test was applied;
• The wording of the BSA was intended to have retrospective effect and “is to be treated as always having been in force”. As a matter of statutory interpretation, the BSA did not exclude the rights of parties involved in ongoing litigation at the time the BSA was enacted/brought into force;
• A developer can be classified as a person to whom a duty is owed under the DPA if the correct tests are satisfied;
• BDW had, as a matter of law, a valid claim against URS under s1(1)(a) of the DPA and that claim was subject to the longer limitation periods provided for by the BSA; and
• There is nothing in the wording of s1(1) of the CLCA to suggest that the making or intimation of a claim by the owners of the Properties was a condition precedent to the bringing of a claim in contribution by BDW against URS.

The Conclusion to the Case

This important decision provides welcome guidance not only in respect of issues which have long been debated in English law e.g. the date of accrual of a cause of action in tort, but also in relation to questions which have emerged more recently as to how the newly extended limitation provisions introduced by the BSA will impact ongoing and future claims concerning damaged and defective buildings.

 

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David Spires 

Partner

E-mail: DSpires@hklegal.co.uk

 

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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