381 Southwark Park Road RTM Company Ltd & Ors v Click St Andrews Ltd (in liquidation) & Anor

A building liability order under section 130 of the Building Safety Act 2022 may be made only in respect of a relevant liability within section 130(3). The statutory gateway does not extend liability for unrelated breaches or losses.

The just and equitable discretion requires consideration of the purpose of the Act and all relevant factors. The associated company’s financial resources may carry little weight. A fair opportunity to contest the liability is material. The associated company need not have been named or joined in the original proceedings, although it must be specified when the order is made.

Leaseholder claimants applied for a building liability order against Click Group Holdings Ltd in respect of liabilities incurred by Click St Andrews Ltd. The earlier judgment had found relevant liabilities arising from inadequate fire protection and structurally inadequate beams, constituting liabilities incurred as a result of building safety risks under section 130(3)(b) of the Building Safety Act 2022.

Click Group Holdings was an associated body corporate because it controlled Click St Andrews indirectly. The principal issue was whether making the order was just and equitable, and what liabilities the order could cover.

1. Order made. It was just and equitable to make a building liability order providing that Click St Andrews Ltd’s relevant liability to the leaseholders was also the liability of Click Group Holdings Ltd.
2. The statutory scheme requires two threshold matters: a relevant liability under section 130(3), and an associated body corporate within section 131. Both were established. The relevant liabilities were those arising from inadequate fire protection and insufficient load-bearing capacity, each involving a building safety risk.
3. The just and equitable discretion is informed by the purpose of the Building Safety Act 2022 and all relevant factors. The court approved the approach in Triathlon Homes LLP and Stratford Village Development Partnership [2024] UKFTT 26 (PC), including the view that the source or extent of the respondent’s assets will ordinarily carry little weight. The special-purpose, thinly capitalised nature of Click St Andrews and the common directing mind supported the order, notwithstanding doubt about Click Group Holdings’ assets.
4. Click Group Holdings had participated in the trial and had a fair opportunity to contest the relevant liability. Its objections concerning expert evidence and the absence of a separately pleaded or joined claim had no merit. The Act does not require the associated company to have been named or joined before the order is made, although it must be specified when the order is made.
5. The order could not operate as a gateway to liability for all losses arising from any breach. It was confined to the relevant liabilities within section 130(3). Losses caused by water ingress were unrelated to a building safety risk and were outside the statutory jurisdiction.
6. The court was not required to quantify the relevant liability when making the order. The order could reflect the wording of section 130 without specifying an amount.

First-instance application for a building liability order. The judgment refers to the court’s earlier judgment, [2024] EWHC 3179 (TCC), which had determined the relevant liabilities.