URS Corporation Ltd v BDW Trading Ltd

Factual and Procedural Background

Following serious fire-safety concerns that emerged after the Grenfell Tower disaster, Parliament enacted the Building Safety Act 2022 (“BSA”). One provision, section 135, substantially extended the limitation periods applicable to claims under section 1 of the Defective Premises Act 1972 (“DPA”).

Company A (the developer of two high-rise residential projects completed between 2005 and 2012) discovered structural defects in 2019, allegedly caused by negligent designs supplied by Company B (consultant engineers). Company A remedied the defects from 2020 onward and, in March 2020, sued Company B in the High Court for the cost of those works.

The High Court ordered a preliminary trial on negligence issues and ruled largely in Company A’s favour. After section 135 BSA came into force (28 June 2022), Company A amended its pleadings to add (i) direct claims under the DPA and (ii) a claim for contribution under the Civil Liability (Contribution) Act 1978. The High Court permitted the amendments; the Court of Appeal affirmed. Company B appealed to the Supreme Court, where Judge Leggatt delivered a concurring opinion that is the subject of this summary.

Legal Issues Presented

1. Whether, apart from BSA section 135, Company A suffered a legally recoverable loss in negligence (Issue 1).
2. Whether, and to what extent, BSA section 135 has retrospective effect on the parties’ negligence, DPA and contribution claims (Issue 2).
3. Whether Company B owed Company A a duty under section 1 DPA and, if so, whether Company A’s claimed loss is of a recoverable type (Issue 3).
4. Whether Company A can seek contribution from Company B under the 1978 Act despite the absence of any judgment, settlement or third-party claim against Company A (Issue 4).

Arguments of the Parties

Appellant's (Company B’s) Arguments

• Negligence: a general common-law principle bars recovery for costs “voluntarily” incurred where the claimant had no pre-existing legal liability to pay them.
• DPA: section 1(1)(a) should exclude commercial developers; developers cannot simultaneously owe and benefit from the same statutory duty, and the DPA is aimed only at consumer protection.
• Contribution: a right to contribution arises only when the claimant’s liability to the third party is finally ascertained by judgment, admission or settlement; none exists here.
• Retrospectivity: section 135 BSA only defeats a limitation defence in a DPA action; it has no wider legal consequences.

Respondent's (Company A’s) Arguments

• Negligence: the voluntariness principle is not an inflexible rule; the question is one of causation and mitigation.
• DPA: on the plain wording of section 1(1)(a), developers fall within “any person to whose order the dwelling is provided.”
• Contribution: the right arises once damage exists and both parties are liable for it; a prior judgment or settlement is unnecessary.
• Retrospectivity: section 135 BSA is to be treated as always having been in force for all legal purposes, including contribution and negligence contexts.

Table of Precedents Cited

Court's Reasoning and Analysis

Issue 1 – Negligence. The Court rejected a hard-edged rule barring recovery of “voluntary” payments. Whether Company A’s expenditure was voluntary is a causation question resolved by assessing what a reasonable developer would have done in the circumstances. The absence of an enforceable legal obligation to leaseholders is relevant but not decisive; reputational and commercial imperatives may justify the expenditure.

Issue 3 – DPA Duty. On a literal reading of section 1(1)(a) DPA, Company B owed the statutory duty to Company A because the dwellings were provided “to the order” of Company A. Excluding developers would require impermissible re-drafting. Consumer-protection motives do not mandate such exclusion, and conceptual concerns about “owing a duty to oneself” are addressed by contributory-negligence principles.

Issue 4 – Contribution. Interpreting the 1978 Act and Limitation Act 1980 in tandem, the right to contribution arises when: (i) common damage exists for which both parties are liable, and (ii) the claimant has paid (or been ordered/agreed to pay) compensation. No judgment, admission or settlement with the third party is mandatory. Company A’s remedial works constitute a payment in kind; therefore the statutory conditions are met.

Issue 2 – Retrospective Effect of BSA section 135. Section 135 expressly revives time-barred DPA claims by substituting a 30-year period and is retroactive to that extent. The Court, however, confined that retrospectivity to matters of pure law (i.e., whether an action is time-barred). It does not rewrite historical facts or automatically render pre-BSA expenditure non-voluntary for negligence purposes. Hence: (a) contribution claims may rely on the revived DPA liability both before and after 28 June 2022; (b) negligence and DPA damages for pre-2022 works still depend on the fact-sensitive causation/mitigation inquiry.

Holding and Implications

FINAL DISPOSITION: APPEAL DISMISSED.

Company A may pursue all three causes of action. The Court confirms that:

• Voluntariness is a factual issue, not an automatic bar to negligence recovery.
• Developers fall within the protective scope of section 1 DPA.
• A contribution right arises on payment (including payment in kind) without needing a prior judgment or settlement.
• BSA section 135 retrospectively revives time-barred DPA liabilities for limitation purposes but does not rewrite other historical facts.

Practically, the judgment broadens potential liability for construction professionals and clarifies contribution litigation, yet it refrains from extending retrospective legislation beyond what Parliament expressly required.