URS Corporation Ltd v BDW Trading Ltd

The Supreme Court dismissed the appellant's appeal. The court held that there is no single bright-line "voluntariness" rule of law which renders voluntarily incurred remedial costs irrecoverable in negligence; questions of voluntariness are normally addressed as aspects of legal causation and mitigation and are fact-sensitive. The court applied established tests for scope of duty and remoteness (including the contract/remoteness test derived from Hadley v Baxendale and SAAMCO-type analysis) and concluded that, on the assumed facts, the repair costs were within the scope of URS's duty and not too remote.

The court further held that section 135 of the Building Safety Act 2022 (which inserted section 4B into the Limitation Act 1980 and retrospectively extended the limitation period for actions under section 1 of the Defective Premises Act 1972 to 30 years) applies to actions dependent on DPA liability even if the particular claim is not itself pleaded under the DPA; the retrospective limitation period therefore removed any relevant time bar at the time BDW incurred remedial costs for the purposes of the negligence and contribution disputes. The court also held that URS owed a duty under section 1(1)(a) of the Defective Premises Act 1972 to a developer who ordered the dwellings (ordinarily the first owner), so BDW could pursue a DPA claim against URS.

Finally, the court held that a claimant who has paid compensation in kind (by carrying out remedial works) can, subject to the statutory tests, bring a claim for contribution under the Civil Liability (Contribution) Act 1978 even where there has been no judgment, settlement or third-party claim: payment (including payment in kind capable of valuation) triggers the right to contribution and the relevant limitation rules in the Limitation Act apply.

The appeal concerned remedial costs incurred by a developer (BDW) after it discovered safety defects in two medium/high-rise residential developments allegedly caused by negligent structural designs prepared by URS. On assumed facts the designs were negligent, the defects created safety risks and BDW carried out remedial works in 2020-2021 after it had divested most proprietary interests. BDW sued URS in negligence (and later sought to amend to add claims under the Defective Premises Act 1972 and for contribution under the Civil Liability (Contribution) Act 1978).

Procedural history:

• Fraser J (TCC) decided preliminary issues in BDW's favour on scope of duty and recoverability ([2021] EWHC 2796 (TCC)).
• Adrian Williamson KC (deputy High Court judge) granted permission to amend pleadings after section 135 BSA came into force ([2022] EWHC 2966 (TCC)).
• The Court of Appeal dismissed appeals and upheld the preliminary rulings ([2023] EWCA Civ 772).
• The Supreme Court granted permission and heard the appeal.

Relief sought: BDW sought damages for remedial costs from URS in negligence; after the Building Safety Act changes BDW sought to add a DPA claim and a contribution claim against URS.

Issues framed:

• whether voluntarily incurred remedial losses are outside the scope of duty or too remote (Ground 1);
• whether section 135 of the Building Safety Act 2022 applies retrospectively to affect limitation and related claims (Ground 2);
• whether URS owed a duty to BDW under section 1(1)(a) of the Defective Premises Act 1972 and whether BDW's losses are recoverable under that duty (Ground 3);
• whether BDW could bring a contribution claim under the Contribution Act absent any judgment, settlement or third-party claim (Ground 4).

Court’s reasoning (concise):

1. On voluntariness, the court rejected a general rule barring recovery simply because payments were voluntarily incurred. Instead voluntariness ordinarily informs legal causation and mitigation and requires a fact-specific assessment of whether the claimant had a realistic choice and whether actions were reasonable; on the assumed facts BDW lacked a realistic alternative and the repair costs fell within the scope of URS’s duty and were not too remote.
2. On section 135 BSA, the court read the provision in light of its context and purpose. Section 135(3) (treating the amended Limitation Act provision as always in force) applies to actions dependent on DPA liability even if they are not pleaded under the DPA (such as negligence or contribution claims) so that the retrospective 30-year limitation period removed any relevant time bar at the time BDW carried out remedial works; the provision does not, however, change factual questions relevant to mitigation or causation at trial.
3. On the DPA, the court interpreted section 1(1)(a) as encompassing a person to whose order a dwelling is provided, ordinarily the first owner, and therefore developers who order work fall within that subsection; URS therefore owed a DPA duty to BDW and BDW’s remedial losses are of the type recoverable under that duty.
4. On contribution, the court held that a claimant who has made or agreed to make a payment in compensation (including a payment in kind capable of valuation) may recover contribution without a prior judgment or settlement, provided statutory conditions are met; limitation for contribution runs from the accrual date defined in the Limitation Act.

The court dismissed the appeal and remitted questions of legal causation, mitigation and factual apportionment to trial where required.

The appeal is dismissed. The Supreme Court held that there is no general rule of law that voluntarily incurred remedial payments are irrecoverable; such questions ordinarily fall to be determined under legal causation and mitigation on the facts. Section 135 of the Building Safety Act 2022, read in its statutory context and purpose, applies retrospectively to actions dependent on section 1 of the Defective Premises Act 1972 (including negligence and contribution claims dependent on DPA liability) so the retrospective 30-year limitation period applied and did not leave BDW time-barred at the time it carried out remedial works. URS also owed a duty under section 1(1)(a) of the DPA to BDW as developer. A claimant who has paid in kind can recover contribution under the Contribution Act without a prior judgment or settlement, subject to statutory tests and limitation rules; factual questions of causation and mitigation remain for trial.

First instance preliminary issues decided by Fraser J, [2021] EWHC 2796 (TCC). Permission to amend pleadings granted by Adrian Williamson KC (deputy High Court judge), [2022] EWHC 2966 (TCC). Appeals dismissed by the Court of Appeal (Coulson LJ leading), [2023] EWCA Civ 772. Appeal to the Supreme Court dismissed [2025] UKSC 21.