A Double BLO: The High Court Grants Anticipatory And Adjudication BLOs In Crest Nicholson v Ardmore

On 1 April 2026, Mr Justice Constable handed down what is likely to become a leading judgment on Building Liability Orders (BLOs) under the Building Safety Act 2022 (BSA). In Crest Nicholson Regeneration Limited & Ors v Ardmore Construction Limited (in Administration) & Ors, the Technology and Construction Court (TCC) granted both an "anticipatory" BLO and an "adjudication" BLO against associated companies of the insolvent contractor, Ardmore Construction Limited (ACL).

The decision provides significant and detailed guidance on the scope and application of the BLO regime, and has important implications for corporate groups operating in the construction sector, particularly those facing potential exposure to building safety claims in the aftermath of the Grenfell Tower tragedy.

What are Building Liability Orders?

Building Liability Orders (BLOs) are an order that the High Court has the power to make under s.130 of the BSA, if it considers it "just and equitable" to do so. One policy intention underpinning s. 130 is to prevent developers from escaping liability for building safety defects by setting up thinly capitalised special purpose vehicles (SPVs) to carry out developments, wind these up following completion, and thus allow their well-capitalised parent companies to avoid long-term liability for any defective works.

Importantly however, this judgment clarifies that the policy intent "should not be defined as in any way limited to being directed at" SPVs and shell companies. Instead, it has a broader legislative purpose which is to allow those directly responsible for defective work to be pursued through their "associates", creating an effective route of redress against those responsible for historical building safety defects.

BLOs do this by extending a "relevant liability" of a body corporate (Party A) so that it will also be a liability of an "associated" body corporate (Party B). In the event that a BLO is made, Parties A and B will then be jointly and severally liable for the relevant liability.

The dispute and development background: Admiralty Quarter, Portsmouth

The dispute concerned the Admiralty Quarter development in Portsmouth, a residential scheme comprising 18 buildings and a 21-storey tower, constructed between 2007 and 2009. ACL had been engaged by Crest Nicholson Regeneration Limited to carry out the design and construction of the development. Following investigations prompted by the Grenfell Tower fire in June 2017, extensive fire safety defects were discovered in the external wall systems, including widespread use of non-compliant combustible insulation and missing or defective fire barriers.

ACL's administration and group structure

ACL entered administration on 28 August 2025, the day before an adjudicator issued a decision awarding Crest approximately £14.9 million in respect of the external wall defects. ACL's administration was driven, at least in significant part, by its exposure to cladding defects claims following Grenfell, and ACL did not have the means to satisfy either the adjudicator's decision or any future judgment.

The Ardmore Group had been restructured over several years. In 2019, two new companies – Ardmore Construction Group Limited (ACGL) and Ardmore Fitout Limited (AFL) were incorporated – specifically to create a structure capable of isolating ACL's historic liabilities from other group companies. A further restructuring in 2024 saw the creation of Ardmore Group Holdings Limited (AGHL), ultimately owned by the Byrne Family Trust.

The claim

Crest sought two forms of relief against the fourth to tenth defendants, which include amongst others AGHL, AFL and ACGL (the BLO Defendants):

1. an anticipatory BLO in respect of any liability ACL might ultimately owe under section 1 of the Defective Premises Act 1972 (DPA) or arising from a building safety risk; and
2. an adjudication BLO making the BLO Defendants jointly and severally liable for the £14.9 million awarded by the adjudicator.

Key issues and the Court's analysis

The "just and equitable" test

A central theme of the judgment is the breadth and flexibility of the statutory discretion under s. 130 of the BSA, which empowers the High Court to make a BLO where it considers it "just and equitable" to do so. The Court endorsed the approach taken by the Upper Tribunal (UT) – albeit in the context of Remediation Contribution Orders – in Edgewater (Stevenage) Limited and Others v Grey GR Limited Partnership. In that decision, Edwin J declined to catalogue or limit the factors relevant to the exercise of the discretion, noting that the factors are "not capable of exhaustive classification".

The TCC distilled the emerging case law into a series of principles, including that the "just and equitable" test is a broad test, which is necessarily fact-specific, and the power to make a BLO is discretionary and should be exercised having regard to the purpose of the BSA and all relevant factors.

Anticipatory BLOs

The Court confirmed unequivocally that it has the power to make an anticipatory BLO, i.e. a BLO ordered before a finding of any relevant liability against the original body. It rejected the BLO Defendants' primary argument that it was premature to determine whether a BLO should be granted in advance of the liability trial, holding instead that the question of prematurity should not be considered separately from the just and equitable assessment but rather as part of the overall balancing exercise.

The Court accepted that the greater its confidence that the same order would be made following trial, the more inclined it would be to grant an anticipatory BLO. On the facts, the Court had a "high degree of confidence" that the development contained building safety risks and that ACL would be found liable, noting that ACL had advanced no positive case denying fitness for habitation.

The Court considered and addressed a wide range of arguments raised by the BLO Defendants, including:

"No good reason": the BLO Defendants had submitted that the purpose of a BLO – to provide ultimate and effective redress against the responsible party – would be met equally well by a BLO at the end of trial as by an anticipatory BLO, such that there was no good reason to make a BLO now. The Court disagreed: an anticipatory BLO would benefit both parties, enabling the claimant to know whether it was worth investing time and money in litigating against an insolvent defendant, and putting the BLO defendants on notice, in advance, as to whether they would stand to be liable for the insolvent defendant's liabilities. If ultimately, there was no finding of liability against ACL at trial, the BLO would be "writ in water as there would be no relevant liability triggering an obligation on the BLO Defendants to pay anything.

Uncertainty of quantum: outstanding issues as to the quantum of any relevant liability were not a reason to decline an anticipatory BLO. The Court held that there is "nothing inherently inequitable or unjust" about making an order in such circumstances, noting that Jefford J in Click St Andrews had made a BLO pending quantification. Further, the financial position of the BLO Defendants was not a material factor weighing against the order. The Court echoed the approach in Triathlon Homes and Click St Andrews that it would be "an unusual case" in which the respondent's assets or liabilities would carry much weight.

Crest's status as a commercial developer: the fact that Crest was a substantial commercial developer, rather than an individual leaseholder or social housing provider, did not weigh against the making of a BLO.

Comparative profits: the BLO Defendants argued that the comparative profits of the parties should also be a factor in whether to grant the BLO. However, this was also rejected, with the court noting that it would lead to a "bizarre outcome" if "commercially unsuccessful builders were able to avoid the application of the BSA, whilst commercially successful ones could not".

Insurance: the Court gave no or little weight to Crest's insurance position, agreeing with counsel for Crest that the purpose of a BLO is to hold those responsible for historical building safety defects to account, not their insurers.

All or nothing?

In an important finding, the Court determined that the exercise of the just and equitable test in making an BLO can include an order that only a proportion of a relevant liability is transmitted to the associate. The court construed the statutory language of "any relevant liability of a specified description" broadly, consistent with the purpose of the BSA, to permit such an approach. This is a significant development clarifying the nature and extent of the Court's jurisdiction, providing flexibility to limit an associate's exposure in circumstances where full transmission of liability might not be just and equitable.

An adjudicator's decision can be a "relevant liability"

The judgment confirms that an adjudicator's decision can in principle constitute a "relevant liability" for the purposes of s. 130 of the BSA.

The Court firmly rejected the BLO Defendants' argument that the interim binding nature of an adjudication decision meant it could not be a relevant liability. An adjudicator's decision, if not challenged in court, constitutes a "binding determination of a party's liability for all time". Indeed, if Parliament had intended the statutory scheme for adjudication and the statutory scheme created by BSA to be mutually exclusive, this would have been spelt out.

The Court further held that there is no inherent incompatibility between the adjudication regime and the BLO provisions of the BSA, and that to hold otherwise would deprive the construction industry of the use of one of its most important dispute resolution tools.

Does an adjudicator have jurisdiction to determine DPA claims?

A significant part of the judgment addressed whether a claim under the DPA falls within the scope of "a dispute arising under the contract" for the purposes of s. 108 of the Housing Grants, Construction and Regeneration Act 1996 (HGCRA).

The Court endorsed and adopted the reasoning of Joanna Smith J in BDW Trading v Ardmore [2024], holding that the phrase "under the contract" within the HGCRA (and within the contract in place between Crest and ACL) includes the jurisdiction to consider claims brought under the DPA.

The Adjudication BLO: just and equitable?

Having determined that the adjudicator's decision constituted a relevant liability, the court went on to find that it was just and equitable to make the adjudication BLO, requiring the BLO Defendants to pay the approximately £14.9 million awarded.

Practical implications of the High Court's decision

1. Anticipatory BLOs are a real and available tool. The court has firmly endorsed the power to make a BLO before the underlying liability has been established, functioning "as what might be termed an indemnity". These will be of obvious benefit to claimants, allowing them to know in advance whether it will be worthwhile incurring the cost and expense of litigating against insolvent counterparties. It will also benefit the associates of insolvent defendants to know in advance "whether they will stand to be liable for the original body's liabilities".
2. Corporate restructuring will be scrutinised. Where a group has restructured to isolate historic building safety liabilities - even where the restructuring was a legitimate business practice – this will be scrutinised. Companies that have placed contracting entities into administration following the emergence of building safety claims should expect close judicial scrutiny.
3. Adjudication decisions are a "relevant liability" for the purposes of a BLO. The Court's ruling that an adjudicator's decision (and the obligation to comply with it) constitutes a relevant liability for the purposes of the BSA significantly expands the practical utility of construction adjudication in the building safety context. Parties obtaining favourable adjudication decisions against insolvent contractors can now seek to enforce those decisions directly against associated companies.
4. DPA claims can be adjudicated. The Court has added its voice to the growing consensus that DPA claims fall within the scope of adjudication provisions referring to disputes "under the contract", applying the broad approach to construction endorsed by the House of Lords in the Fiona Trust case (which considered similar wording in the context of an arbitration clause).
5. The "just and equitable" test is broad and fact-sensitive. The Court has resisted attempts to narrow or circumscribe the test, declining to set out exhaustive lists of factors or to require particular thresholds to be met. Each case will turn on its own facts.
6. The Court has a wide discretion on the scope of a BLO. The finding that the Court may reduce or limit the relevant liability upon transmission — specifying, for example, that only a proportion of a relevant liability is subject to a BLO — provides a significant tool for balancing the interests of applicants and respondents.

Crest Nicholson v Ardmore represents a watershed moment in the development of the BLO regime under the BSA. The judgment demonstrates the willingness of the courts to give full effect to the legislative purpose of holding those responsible for building safety defects to account, even where the original contracting party is insolvent and the extent of liability remains to be determined at trial.

The message is clear: the corporate veil, and the protections of corporate structure more generally, will not prevent associated companies from being required to stand behind the liabilities of group members responsible for building safety defects. The interaction between the adjudication regime and the BSA, now confirmed by the Court, means that successful adjudication decisions can be leveraged as a powerful tool in the pursuit of redress from associated companies.

The case will also be of considerable interest to the adjudication community, given its endorsement of the application of Fiona Trust principles to adjudication clauses and its confirmation that DPA claims fall within the scope of standard adjudication provisions.

Read the original article on GowlingWLG.com

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.