Design Defect Liability Case BDW v URS – Supreme Court Judgment

In the Design Defect Liability Case of BDW v URS, the Supreme Court issued a landmark ruling that clarifies the scope of liability for construction professionals who provide defective design services, particularly in the post-Grenfell regulatory landscape.

The decision in BDW Trading Ltd v URS Corporation Ltd (2025) examines whether a developer can recover the costs of voluntarily remediating building safety defects from its design consultants, and considers whether common law principles, limitation statutes, or the doctrine of voluntariness bar such recovery.

Background Design Defect Liability Case BDW v URS

The case centres on structural design failures in two high-rise residential developments — “Capital East” and “Freemens Meadow” — both designed by URS and developed by BDW, which includes Barratt Homes and David Wilson Homes.

After the Grenfell Tower fire in 2017, BDW undertook proactive investigations and discovered serious safety defects. Though no third-party had brought claims against BDW, it decided to remediate the defects at its own cost and incurred millions in expenses.

BDW sued URS in tort for negligence and later added claims under the Defective Premises Act 1972 (DPA) and the Civil Liability (Contribution) Act 1978, following changes to limitation periods brought in by the Building Safety Act 2022.

The Supreme Court heard the appeal on four grounds:

Ground 1: Were BDW’s Remediation Costs Recoverable in Tort, or Were They Voluntarily Incurred and Too Remote?

The central issue was whether BDW’s voluntary expenditure to rectify design defects could be recovered in tort, despite the absence of a legal obligation or active third-party claims at the time of remediation.

URS argued that BDW’s costs fell outside the scope of the duty of care or were too remote, relying on a so-called “voluntariness principle” — a proposition that voluntarily incurred losses, absent enforceable liability, are irrecoverable.

The Court rejected this argument. It held that URS had assumed responsibility for the structural design and recognised that negligent design foreseeably caused the type of loss BDW incurred — the cost of remedial works

It confirmed that:

The risk of dangerous design defects fell squarely within the scope of URS’s duty.

The foreseeability of remediation costs was established at the time URS assumed the duty.

There is no legal principle that automatically bars recovery of voluntarily incurred losses.

The judgement emphasised that one should consider voluntariness under the concepts of legal causation or mitigation, rather than treating it as a standalone bar under scope of duty or remoteness.

Furthermore, the justices emphasised that BDW faced reputational harm and potential personal injury liability if it failed to act, and its conduct was commercially and morally compelled.

The Court found no basis for applying a rigid "voluntariness principle" and ruled that BDW’s losses were, in principle, recoverable.

Ground 2: Does Section 135 of the Building Safety Act 2022 Apply Retrospectively to Revive Time-Barred Claims?

BDW initially claimed that third-party actions against it were time-barred, which lowered the perceived risk and prompted its decision to carry out the remediation work.

However, after the Building Safety Act 2022 came into force — extending the limitation period for claims under the DPA to 30 years — BDW acknowledged that third-party claims were no longer time-barred and amended its case accordingly.

URS argued that Section 135 of the BSA did not apply to collateral issues such as BDW’s tort claim or its right to contribution, and that it should not retrospectively affect established limitation defences.

The Supreme Court firmly rejected URS’s position. It ruled that:

Section 135 is intended to be retrospective and to revive previously time-barred claims under section 1 of the DPA.

This retrospective revival applies not just to direct DPA claims but also to claims in negligence or for contribution that rely on an existing (now revived) liability under the DPA.

Section 135 should be treated as having always been in force, subject only to two express exceptions: (1) claims settled or finally determined before its commencement, and (2) cases where its application would breach Convention rights.

The Court explained that to exclude developers from claiming contribution based on revived liabilities would undermine the legislative purpose of holding those responsible for building safety defects to account.

The judges concluded that Section 135 legally revived BDW’s liability to third parties under the DPA at the time of remediation, which defeated URS’s voluntariness argument in tort and validated BDW’s claims under both the DPA and the Contribution Act.

Ground 3: Does the Defective Premises Act 1972 Allow a Developer Like BDW to Claim as a Beneficiary?

Another significant issue was whether URS owed BDW a statutory duty under section 1(1)(a) of the DPA, which states that persons who take on work in connection with a dwelling owe a duty to the person "to whose order" the dwelling is provided.

URS argued that developers could not benefit from the duty under section 1(1)(a) because they also belong to the class of those who owe the duty under section 1(4), and the Act was intended to protect consumers rather than commercial entities.

The Court dismissed this restrictive interpretation. It held that:

Section 1(1)(a) applies in its plain wording to any person who commissions the provision of a dwelling, including developers.

The policy of the DPA is not confined to consumer protection but is also concerned with ensuring safe construction and proper accountability.

There is no legal incompatibility in a developer both owing and being owed a duty under the Act in respect of the same dwelling.

BDW, as the first owner of the buildings and the party commissioning URS, was clearly within the scope of section 1(1)(a).

Therefore, URS owed BDW a statutory duty under the DPA, and BDW’s claim under that Act was valid.

Ground 4: Can a Developer Claim Contribution Without a Judgment or Settlement from a Third Party?

Finally, the Court examined whether BDW could seek a contribution from URS under the Civil Liability (Contribution) Act 1978, even though no court had entered judgment against BDW, it had reached no settlement with third parties, and no third party had made a claim.

URS argued that a party could not bring a contribution claim unless it had judicially established or formally acknowledged its liability.

The Court disagreed and clarified that:

The right to claim contribution arises once the claimant has made a payment in respect of damage for which both parties are liable — not only after a claim has been brought or judgment entered.

The remedial works BDW carried out constituted a payment in kind for the purposes of the Act.

BDW did not need a court judgment or third-party settlement to seek contribution.

This ruling makes it clear that a proactive developer who remedies a building safety defect can seek recovery from other responsible parties without waiting for litigation to occur.

Key Takeaways from Design Defect Liability Case BDW v URS

No “voluntariness principle” bars recovery: The Court rejected any 'bright-line rule of law' preventing recovery of voluntarily incurred costs where foreseeable and within the scope of duty.

Section 135 of the BSA is fully retrospective: The Court confirmed the 30-year limitation for DPA claims applies even to time-barred liabilities at the time of remediation, enabling contribution and tort claims that rely on them.

Developers can claim under the DPA: The duty under section 1(1)(a) of the DPA extends to developers who commission work on dwellings, not just purchasers or tenants.

Contribution claims do not require third-party claims: A party can recover contribution under the 1978 Act by making a compensatory payment, even if no one has sued it or it has not settled with the injured party.

This case enhances accountability post-Grenfell: The ruling supports policy goals to shift financial responsibility for unsafe buildings onto those directly responsible.

Need Advice on Building Safety or Defective Premises Liability?

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Our expert surveyors provide specialist advice on navigating the evolving legal landscape, including liabilities under the Defective Premises Act and contribution rights.

Get in touch with our Building Safety Team today to discuss how we can support your project and protect your position.

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