By: Ben Smith [1], Partner; Huw Wilkins [2], Partner; and Jonathan Clarke [3], Associate

In a much-anticipated judgment that was released at 10:30 a.m. on 1 April 2026, the TCC brought a touch of seriousness to April Fools’ Day morning.

Mr Justice Constable’s decision to grant a building liability order (“BLO”) in Crest Nicholson Regeneration Ltd & Ors v Ardmore Construction Ltd (In Administration) & Ors [2026] EWHC 789 (TCC) is already being viewed as one of the most significant developments to the Building Safety Act 2022 (“BSA”) regime to date.

Our initial thoughts on Mr Justice Constable’s decision are summarised below.

Key Takeaways

Significantly, Mr Justice Constable decided that:

1. a BLO can be granted before any finding of relevant liability – what is being referred to as an “anticipatory” BLO;
2. an adjudicator’s decision, even though it is only temporarily binding, can amount to a relevant liability under section 130 of the BSA;
3. a court can order a BLO in respect of a proportion of a relevant liability under section 130(2) of the BSA rather than its entirety, should it be just and equitable to do so; and
4. deliberate corporate restructuring will not mitigate statutory liability of associated companies, even where shares are vested in a family trust via a holding company (such as in the case of the Sixth Defendant here).

Helpful commentary has also been provided on:

1. the various applicable principles for a BLO, in light of the developing case law and statutory regime;1 and
2. the persuasiveness (or lack thereof) of various arguments as to why it may not be just and equitable to grant a BLO.2

Facts

The claimants were members of the Crest Nicholson Group, including Crest Nicholson Regeneration Limited which was the developer and Crest Nicholson (South) Limited which is the long leaseholder of 19 residential apartment buildings in a development known as Admiralty Quarter in Portsmouth (the “Development”). The four Crest Nicholson entities noted as claimants in the judgment are collectively referred to as “Crest”.

Ardmore Construction Limited (“ACL”) was the main contractor for the Development under an amended 1998 JCT D&B Contract.

Following investigations by Crest, it was alleged that the external wall systems at the Development were defective because of certain fire safety defects – principally (i) the presence of combustible polyethylene (“PE”) cladding panels and (ii) fire barriers were missing or inadequate. Other internal fire safety defects, including defective fire doors and inadequate compartmentation were also observed.

Crest started an adjudication for the costs associated with the anticipated remedial works for the non-compliant elements of the external wall systems. The adjudicator decided that the defects amounted to a breach of Part B of the Building Regulations and ACL’s duties under the Defective Premises Act 1972 (the “DPA”). Consequently, the adjudicator determined that ACL should pay Crest approximately £14.9 million.

Around the same time as the adjudicator’s decision, ACL went into administration. The sums awarded by the adjudicator were not paid. Crest therefore made an application to the court for two forms of relief against the Fourth to Tenth Defendants (collectively the “Ardmore Group Companies”):

1. An “anticipatory” BLO: An order that any liability which ACL might ultimately be found to owe under section 1 of the DPA or as a result of a building safety risk would also be the joint and several liability of the associated Ardmore Group Companies, even though final liability had not yet been determined.
2. An “adjudication” BLO: An order making the same associated Ardmore Group Companies jointly and severally liable for the £14.9 million awarded in the adjudicator’s decision, which had gone unpaid following ACL’s administration.

The Ardmore Group Companies resisted both aspects of the application. Unlike in the last successful BLO application in 381 Southwark Park Road RTM Co Ltd v Click St Andrews Ltd (In Liquidation) [2024] EWHC 3569 (TCC),3 the Ardmore Group Companies decided to actively participate in the BLO hearing.

Crest’s arguments

Crest’s position was that:

1. without a BLO, any judgment or adjudication award against ACL would be unenforceable;
2. the Ardmore Group Companies had deliberately tried to structure its affairs to shield itself from liability under the BSA and the DPA;
3. an “anticipatory” BLO would provide commercial clarity and procedural efficiency; and
4. an “adjudication” BLO was reasonable as the adjudicator’s decision represented a relevant liability arising from building safety risks.

The Ardmore Group Companies’ arguments

The Ardmore Group Companies’ position was that:

1. the application was premature, given that liability and quantum had not been finally determined;
2. Crest was a sophisticated commercial party, whereas the financial impact on the Ardmore Group Companies made a BLO unjust; and
3. an adjudication decision was only temporarily binding and amounted to “rough justice” and was never intended by the BSA to be a relevant liability.

Mr Justice Constable’s summary of the key principles for a BLO

Before turning to the issues, Mr Justice Constable distilled the authorities and other material referred to the court on the topic of BLOs as follows:

1. the assessment of whether it is just and equitable to grant a BLO is a broad test and necessarily fact specific;
2. the court’s power is discretionary and should therefore be exercised having regard to the purpose of the BSA and all relevant factors;
3. the court’s power includes the ability to make an anticipatory BLO, that is a BLO which is ordered before a finding of any relevant liability;
4. 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 to be pursued through their associates. The purpose of the BSA should not be defined as in any way limited to being directed at special purpose vehicles and shell companies;
5. the court should not seek to limit the statutory test by setting out an exhaustive list of factors;
6. it will generally be sensible for an application for a BLO to be case managed within the same proceedings as the main claim; and
7. 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, the primary consideration for granting a BLO is whether it is just and equitable to do so.

The decision

Applying those principles, the court granted both the “anticipatory” BLO and the “adjudication” BLO. Mr Justice Constable decided that:

1. an adjudicator’s decision could give rise to a relevant liability for the purposes of section 130(3) of the BSA. Mr Justice Constable rejected the Ardmore Group Companies’ argument that a court must itself be satisfied that there is a relevant liability before it can make a BLO. It was held that an adjudicator’s decision is binding unless successfully challenged and there was nothing to suggest that the statutory regimes for adjudication and BLOs could not operate together; and
2. it was just and equitable to grant the anticipatory BLO because the Development clearly contained building safety risks for which ACL would likely be found liable. It was appropriate to grant the BLO because it had been conceded that a number of the Ardmore Group Companies were “associates” of ACL for the purposes of section 131. It was also noted that ACL had been placed into administration for the benefit of the wider group, with the arguable purpose of avoiding liabilities under the BSA.

Conclusion

This case is a significant development on the last (and first) successful BLO granted in 381 Southwark Park Road RTM Co Ltd v Click St Andrews Ltd [2024] EWHC 3569 (TCC). In his decision here, Mr Justice Constable grappled with many of the key issues relevant to the BLO regime. He considered the potential scope of BLOs and how they can be utilised by parties looking to enforce DPA/building safety liabilities whilst reinforcing that the assessment of whether it is just and equitable to grant a BLO is a broad test and necessarily fact specific.

However, we understand that Ardmore is preparing to appeal the decision and that the Court of Appeal may soon have its first opportunity to consider these important issues.

• 1. See Section E, and particularly paragraph 61 of the judgment.
• 2. See Sections G and H, and particularly at paragraphs 86 to 115 and paragraphs 199 to 208, of the judgment.
• 3. See “Building Liability Orders: What do we know now that the firms one has been made? [4]” by Huw Wilkins.