{"id":535637,"date":"2026-01-26T12:29:20","date_gmt":"2026-01-26T12:29:20","guid":{"rendered":"https:\/\/www.constructionnews.co.uk\/?p=535637"},"modified":"2026-02-04T10:38:17","modified_gmt":"2026-02-04T10:38:17","slug":"behind-the-veil-a-year-of-building-liability-orders","status":"publish","type":"post","link":"https:\/\/www.constructionnews.co.uk\/sections\/long-reads\/behind-the-veil-a-year-of-building-liability-orders-26-01-2026\/","title":{"rendered":"Behind the veil: a year of building liability orders"},"content":{"rendered":"

July 2021 was an extraordinary month of weather in London, marked by heatwave temperatures, heavy rains and flooding. On the 12th, nearly a typical month\u2019s worth of rain fell in parts of the capital.<\/p>\n

Less than a fortnight later, on the 24th, the city was again subjected to thunderstorms, with St James\u2019s Park recording 41.8mm of rainfall. Two hospitals and eight tube stations were closed, while floods were widely reported, from Hampstead in the north to Hackney Wick in the east.<\/p>\n

\u201cThe remedial work went beyond inept and was signed off by building control. Most shockingly, there was a boiler in one of the original top floor flats and the flue just went into the ceiling\u201d<\/p>\n

Alastair Ferguson, Ridge and Partners<\/h4>\n<\/blockquote>\n

The next day, a building project south of the Thames in Bermondsey was about to go seriously awry. The storms hit just as a fifth storey was being added to St Andrews House on 381 Southwark Park Road, with cranes hoisting up modular units. The original pitched roof had been removed and adapted with a steel frame in preparation for the new units to be fitted. Only a few modules had been lifted into place, but once the threat of lightning striking the cranes became real, work stopped. And then came the torrential rain.<\/p>\n

 <\/p>\n

Second-floor resident Laura was at her sister\u2019s wedding that day. When she looked at her phone in the late afternoon, there were more than 80 messages on the residents\u2019 WhatsApp group chat. \u201cI saw the photos and videos of water pouring through the building,\u201d she tells Construction News<\/em>. \u201cIt was like a nightmare.\u201d<\/p>\n

Gloria, who lived on the same floor as Laura, had left that afternoon to meet a friend. When she returned in the evening, the downpour had stopped but her flat was in total darkness. \u201cThere was no electricity,\u201d she recalls. \u201cWhen I walked into my hallway, it was wet.\u201d In the kitchen, Gloria found a \u201cpuddle of water that had come through from the flat above\u201d.<\/p>\n

\"\"

Ceiling damage at St Andrews House<\/p><\/div>\n

The flats on the top floor of St Andrews House suffered severe flood damage, which also affected several other properties in the building. Initially, residents and tenants thought the firm that owned the freehold, which was managing the modular construction, would remedy the situation and carry out the extensive repairs needed. That firm was Click St Andrews, a special purpose vehicle (SPV) \u2013 companies set up as separate entities by businesses to carry out a specific purpose or project.<\/p>\n

The 2022 Building Safety Act (BSA) introduced provisions to allow the High Court to grant building liability orders (BLOs), which enable claimants to rope in an associated company for the purposes of liability, where it is \u201cjust and equitable to do so\u201d. Ways of determining whether a company or SPV is associated with another firm are set out in section 131 of the BSA. For example, an SPV would be associated with a holding company if that business had the right to acquire at least half the share capital of the SPV.<\/p>\n

The tenants and residents of St Andrews House, through their right to manage (RTM) company, were eventually able to secure a BLO against businesses in the Click group. But while an important precedent of law was established, has justice been served?<\/p>\n

Surveying the scene<\/h3>\n

Only a few of the building\u2019s modular units had been installed by the time the storm hit on 25 July. The rest were craned into place on the weekend of 7-8 August. Water ingress continued with each bout of heavy rain that summer. Shortly after the initial damage was caused, Click started drying-out works. Around the same time, residents brought in John Rivett, a surveyor at property management company Rise4, who assessed the initial damage caused by the water and the reasons for it. His report, which formed part of the claimants\u2019 case in court, spoke not only of insufficient dehumidifiers to dry out the building, but also a lack of protection to stop the top floors from water ingress in the event of heavy rain. Rivett reported that the contractor had only installed temporary tarpaulin sheets.<\/p>\n

\"\"

Rivett raised concerns about structural steel beams<\/p><\/div>\n

But that wasn\u2019t all Rivett discovered. He also expressed concerns about the loadbearing structure of the building and the rooftop flats. He told the court that his inspection revealed, in his professional opinion, that the supporting steelwork for the corner of one unit was significantly short, meaning that when in place, the corner would not be supported on the steelwork. He also contended that the end of the steel transfer beam, which would take the load of the unit, was unsupported on the building structure, and that the steelwork was cantilevered and did not appear to be properly supported on the external or loadbearing wall.<\/p>\n

Rivett raised further concerns about the electrical cabling running through the gap between the original ceilings of the top-floor flats and modular units, which he saw as a fire risk. In light of the alleged structural and fire-safety issues, he recommended bringing in a structural engineer and fire-safety expert to provide further advice. Following the eventual court case, he noted that \u201cthe fire and structural safety [issues] were the things that paved the way\u201d for the BLO.<\/p>\n

Based on Rivett\u2019s report, RTM engaged Alastair Ferguson, chartered architect at consultancy Ridge and Partners, to investigate the remediation, as well as the structural and fire-safety concerns. Ferguson would later tell the court that there were no fire collars or other methods of protection for the cabling in the space between the old ceilings and the new modular units. In addition, much of the void contained builders\u2019 waste material. What\u2019s more, where a new boiler was installed in flat 13, the flue \u201cterminated in [the] void\u201d.<\/p>\n

\u201cIt\u2019s a big step forward \u2013 we\u2019re upturning over a century of company law by piercing the corporate veil\u201d<\/p>\n

Michael Levenstein, Gatehouse Chambers<\/h4>\n<\/blockquote>\n

Speaking at a legal seminar in September, Ferguson said: \u201cIt took about two minutes to realise there was an enormous problem with the roof. The remedial work went beyond inept and was signed off by building control. Most shockingly, there was a boiler [in one of the original top-floor flats] and the flue just went into the ceiling.\u201d<\/p>\n

\u2018No dialogue\u2019<\/h3>\n

In February 2022, the residents issued a letter of claim to Click, which marked the beginning of a long and winding legal road. \u201cWe were after a constructive dialogue with Click at the time to try and resolve things,\u201d says Ian Bacon, one of four directors now managing the building\u2019s freehold. These attempts failed, he adds.<\/p>\n

Two years later, in February 2024, the matter reached the High Court. The residents and their RTM company advanced claims totalling about \u00a33.6m, comprising roughly \u00a33.1m for remedial works and \u00a3500,000 for consequential losses.<\/p>\n

The judgment came in December that year, finding that Click St Andrews was liable for serious construction failings at St Andrews House, most notably in relation to the rooftop flats and associated works. The court identified persistent water ingress through the roof and parapets, defective waterproofing and drainage, as well as widespread damp and mould in the upper flats and communal areas. Building Regulations compliance, fire stopping and structural integrity failures were also identified, with the works ruled to have been undertaken without reasonable skill or care, and the properties deemed not fit for habitation. The failings rendered parts of the building unsafe.<\/p>\n

Parent company Click Group Holdings Ltd was the guarantor for the works. While it was found to be contractually liable for any sums owed by Click St Andrews, the SPV had gone into insolvency the previous June, making recovery via the guarantor route uncertain.<\/p>\n

As such, the residents sought a BLO to extend liabilities to the holding company. A ruling came less than two weeks after the original judgment. The court was satisfied that it was \u201cjust and equitable\u201d to extend liability on the basis of the serious fire and structural safety defects identified in the rooftop works, finding that these issues directly engaged the purposes of the BSA.<\/p>\n

The court did not determine the amount of compensation due, nor the total value of residents\u2019 claims. And the granting of the BLO was not the end of the saga. In July this year, Click Group Holdings followed its subsidiary into liquidation. One company in the Click family survives: Click Herschel. Residents are currently mulling whether to apply for a BLO against this firm, but the legal costs could be considerable. Their focus is now on pursuing insurance companies.<\/p>\n

The residents may now have the freehold of the property, which they were awarded following the collapse of Click St Andrews, but has it been a pyrrhic victory?<\/p>\n

With ownership comes responsibility for repairing the damage and structural issues,
\nwhich could cost more than \u00a32m \u2013 on top of a mounting legal bill in pursuit of moneys.<\/p>\n

In addition, Southwark Council slapped a dangerous-structure notice on the building in February 2024. While this may have helped residents\u2019 case at the time, Bacon says it now means they \u201chave no flexibility to sell, even if we wanted to\u201d.<\/p>\n

Gatehouse Chambers\u2019 Michael Levenstein, the barrister who argued the residents\u2019 case in court, says a BLO might be a \u201cblunt\u201d legal instrument, but it represents serious progress in the law. He tells CN<\/em>: \u201cEven if the BLO may not have come in time to actually replenish the pockets of the leaseholders in this case, it will signal the opposite to other builders, because at least there is now greater accountability rather than less.\u201d<\/p>\n

\u201cWill the BLO ensure that every defect is remediated because money is found at the end of the rainbow? No,\u201d\u00a0 he adds. \u201cBut I think it is a big step forward in the right direction. We\u2019re upturning over a century of company law by piercing the corporate veil.\u201d<\/p>\n

Living out of suitcases<\/h3>\n

That may be little immediate comfort to residents of 381 Southwark Park Road in their current predicament. For 47-year-old Luke, the pursuit of Click has been \u201cincredibly frustrating\u201d. The process turned his life upside down, forcing him to postpone his wedding and adopt a semi-nomadic lifestyle, before he and his partner eventually moved to Manchester. \u201cWe spent almost a year living out of suitcases in London and have not been able to replace a lot of personal possessions lost in the flooding,\u201d he says.<\/p>\n

One of the owners of the modular-unit flats, who bought his property off-plan, tells CN<\/em> he was not told about the legal proceedings at the time of purchase. While he has no immediate intention to sell, the situation is causing him stress. \u201cIt creates a lot of uncertainty,\u201d he says. \u201cI don\u2019t know how or what else might happen.\u201d<\/p>\n

For Bacon, the system is still far from perfect. \u201cIn principle, BLOs are great against the big developers,\u201d he tells CN<\/em>. \u201cBut if you\u2019re screwed over by a small developer that is able to wind up and move on, then they [BLOs] are toothless without [the liability] being able to be transferred to the culpable directors of the developer companies that are ultimately responsible for the decisions.\u201d<\/p>\n

CN<\/em> tried on numerous occasions to contact Aaron Emmett, the sole former director of Click St Andrews, but he did not respond and the phone number listed on his website did not connect. But on that website are his musings on the liquidation of Click St Andrews in June 2023. \u201cI firmly believe that every ending brings with it the promise of a new beginning,\u201d he wrote. \u201cJust like the sun setting, it will rise again the next morning, heralding a fresh start.\u201d<\/p>\n

New dawns continue to elude the residents of 381 Southwark Park Road. Laura, who suffered physically, mentally and financially, to the point where she had to move out, remains despondent. \u201cWe\u2019ve been told we\u2019ve won but there\u2019s still no visible victory,\u201d she says. \u201cThe BLO sounded like a promising new bit of legislation, but it\u2019s brought no justice to our case to date.\u201d<\/p>\n

\n

How the 2022 Building Safety Act is changing the legal landscape through building liability orders and court action<\/h3>\n

No need to wait According to the High Court, it is possible to apply for a BLO before liability in a case is proven, allowing claims against associated companies to move forward at the same time as the main liability claim is progressing.<\/p>\n

Size doesn\u2019t matter BLOs are not limited to high-rise residential buildings \u2013 they can apply to any building with a fire or structural safety risk, including care homes, office blocks and hotels.<\/p>\n

Precedent set The granting of the first recorded BLO in the Southwark Park Road case set a significant precedent on how the new legal instruments will play out against associated companies that were not part of original liability claims.<\/p>\n

New sheriff in town Essentially, BLOs are the muscle to enforce the principle that those responsible for building defects must bear the cost of fixing them. Those costs can be pursued through associated companies and across decades.<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

July 2021 was an extraordinary month of weather in London, marked by heatwave temperatures, heavy rains and flooding. On the 12th, nearly a typical month\u2019s worth of rain fell in parts of the capital. 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