On 8 July 2025, the Court of Appeal (’CoA’) delivered back-to-back landmark judgments concerning the application of the BSA, specifically the operation of Part 5 of the BSA.
The first appeal concerned Adriatic Land 5 Ltd v The Long Leasholders at Hippersley Point [2025] EWCA Civ 856 (‘Adriatic’) and confirmed that Schedule 8 in the BSA prevented landlords from passing on historical safety remedial costs to leaseholders.
The second appeal concerned Triathlon Homes LLP v Stratford Village Development and ors [2025] EWCA Civ 846 (‘Triathlon’) in which the Court, while rejecting the Developers’ appeals, gave clarity to the criteria that would be applied when deciding who should fund necessary fire safety remedial work.
The Triathlon appeal
This was essentially a leapfrog appeal against a decision made by the First-tier Tribunal ("FTT") regarding the application of a Remediation Contribution Order ("RCO") under Section 124 of the BSA. The applicants appealed FTT’s decision on two grounds. Firstly, they argued that FTT were wrong to decide that it was just and equitable to grant an RCO; secondly, that Section 124 of the BSA did not have retrospective effect.
Facts
Triathlon concerned a residential development in the former London Olympic Village known as “East Village”, specifically five blocks (Blocks A to E) on Plot N26. There were four relevant parties to the appeal:
- Stratford Village Development Partnership ("SDVP"). The original developer of Plot N26.
- Get Living plc. The ultimate owners of SDVP following a sale in 2018.
- Triathlon Homes LLP. A long leaseholder of social affordable housing within Plot N26; and
- East Village Management Ltd (EVML). A company set up in 2009 in agreement between Triathlon and SDVP and granted a headlease to manage the estate. Voting rights in EVML were split (58% in favour of Get Living plc, 39% Triathlon and 3% private individuals).
SDVP entrusted the management of the project to Lend Lease Development Ltd who commissioned Galliford Try Construction Ltd as its design and build contractor. The Blocks were completed in March 2012. An internal retrofitting of the Blocks occurred following the London 2012 Summer Games and subsequently, individual tenancies were granted to residents of social housing (by Triathlon) and private housing (by a subsidiary of Get Living plc).
The June 2017 Grenfell Tragedy prompted EVML to review the cladding materials used at East Village. In November 2020 serious fire safety defects were discovered on each of the five N26 Blocks in regard to both the design and construction of non-ACM cladding materials used on the facades. Applications were made by EVML to the Building Safety Fund which is one of three central government schemes providing assistance to building owners to meet the cost of remedying fire risk. Following lengthy discussions, EVML's board eventually agreed removal and replacement of the exterior cladding (the "Major Works"). In February 2023, it was confirmed that the Fund would cover the costs of the Major Works and a Grant Funding Agreement was signed in June 2023 providing funds up to approximately £27.5 million.
The BSA came into force on 28 June 2022 and dramatically changed the liability regime over fire safety defects. Importantly, paragraph 2 of Schedule 8 to the BSA introduced protective measures meaning that none of the costs of the Major Works (i.e fire safety defects) were recoverable as service charges if the original developer, or an associated company, was the landlord or a superior landlord as was the case here.
Triathlon applied to FTT for Remediation Contribution Orders against SVDP and Get Living plc requiring them to pays its share of the costs of the Major Works to EVML. In summary, FTT found SDVP to be in a financially precarious position; Get Living plc, however, was found to have significant assets totalling more than £2.6 billion and therefore more than capable of meeting any obligation imposed in the proceedings.
In their decision of 19 January 2024, FTT granted the RCOs against SDVP and Get Living plc finding that it was just and equitable to do so on the basis that it was the policy of the BSA that primary responsibility for the cost of remediation should fall on the original developer.
SDVP and Get Living plc appealed FTT's decision on two primary grounds:
- Ground 1. Whether FTT erred in ten separate respects concluding it was “just and equitable” to make the RCOs, and;
- Ground 2. Whether RCOs could be made for costs incurred before the relevant part of the BSA came into force on 28 June 2022.
Decision
Both grounds of appeal were unanimously rejected by the CoA, with Lord Justice Nugee delivering the leading judgment. The following issues were considered.
Ground 1.1 - an unexpressed presumption
The CoA confirmed that whilst there is no automatic presumption, it was clearly the intention of parliament, in a public policy context, to place primary responsibility on developers. In reaching this conclusion, the Court referred to, and confirmed, the Supreme Court’s reasoning in URS Corporation Ltd v BDW Trading Ltd [2025] UKSC 21 (’URS’).
The public purse (such as the Fund) was a backstop, or last resort and the CoA recognised that in some (rare) instances, it might not be just and equitable to impose an RCO on for example, an associated company which was charity.
Ground 1.2 - passing on costs to developers
The CoA found that although Regulation 3 did not apply directly to SDVP or Get Living plc, this did not undermine the reasoning of the FTT which was correctly based on the principle that the BSA imposes primary responsibility for the remedial costs on the original developer, or their associated companies, who retained an interest in the subject matter.
Ground 1.3 – Triathlon's motivation
The CoA ruled that the FTT were right when deciding that it was not necessary for them to resolve any issues as to Triathlon's motivation in applying for the RCOs. Generally, parties who have legal rights or remedies are entitled to pursue them without having to explain why they have decided to do so, and a litigant's subjective reasoning (absent of malice) are usually irrelevant to the merits of the claim. Triathlon undoubtedly had standing to apply for an RCO and its identity did not change the question as to whether it was just and equitable to make such an order.
Ground 1.4 and 1.10 - the public purse
The CoA rejected the argument that an RCO was not needed to fund the work because the funding by the Fund was working perfectly well and did not affect BSA’s objective to ensure that the work is done and funded by the right entity. FTT rightly found, that the policy of the BSA was that primary responsibility to pay for the remedial works should fall on a developer in the position of SDVP (and hence Get Living plc) so the key question was, "Why should the public continue to fund the remediation works when the developer and associated companies are available and able to pay?" The existence of public funding should not displace the operation of Section 124 of BSA.
Ground 1.5 – pursuing other claims
The CoA found that Section 124 of the BSA offers a standalone non-fault based remedy and the policy of the BSA was that costs of remediation should primarily fall on developers rather than having to wait for the outcome of complex litigation that could take years to resolve.
Ground 1.6 – the context of the applications to the Fund
The Court determined that the real question was whether there was anything inconsistent in Triathlon on the one hand pressing for EVML to obtain public funding, and on the other hand then seeking an order that the Appellants cover what would have been Triathlon's share of the costs. There was no suggestion that Triathlon had promised not to apply for an RCO or was estopped from doing so.
Ground 1.7 – no expectation by the Fund
The CoA found that the FTT were correct in making an RCO on the basis it was in the public interest to secure reimbursement of the funds as quickly as possible. The Court also rejected (as too speculative) arguments suggesting that pressing developers and investors too hard might discourage investment in the provision of new housing.
Ground 1.8 – the changing of the identity of the beneficial owners of SDVP and Get Living plc
The CoA agreed with the FTT's reasoning that Get Living plc, a company of considerable financial means, was precisely the target envisaged under Section 124 of the BSA concerning associated companies. Furthermore, the CoA added that if you invest in a company, you take the risk of unforeseen liabilities attaching to the company.
Ground 1.9 – terms of Grant Funding Agreement
The CoA found that Clause 4.3.1(d) of the Grant Funding Agreement served only to prevent EVML from pursuing claims against leaseholders in their capacity as parties to the lease in question and did not prevent EVML from pursuing other entities such as Get Living plc as the associate company of the freeholder, even if they happened also to fall into the category of Leaseholder (for example if they owned a flat in the block in question).
Ground 2 – retrospectivity
In rejecting Ground 2, the CoA found that Section 124 of the BSA had retrospective effect. Nugee LJ’s starting point was the judgment of the Supreme Court in URS and the effect of Section 135 of the BSA which extended the limitation period for bringing claims under the Defective Premises Act 1972. The Supreme Court had considered the general principles of the BSA, specifically Part 5, finding that the provisions of Part 5 to be "backward-looking" and that all four sets of provisions under Part 5 had retrospective effect as explained by the Secretary of State, in her written submissions, where she said that retrospectivity was "central in achieving the aims and objectives of the BSA".
Accordingly, Nugee LJ determined that the Supreme Court's judgment in URS was self-evidently strongly in favour of Section 124 of the BSA being given a retrospective interpretation in accordance with the primary objective of Part 5 of the BSA; namely, to ensure that leaseholders are not required to bear remediation costs for the rectification of historical defects and that those responsible for the defects should bear the financial burden. Nugee LJ further observed that the BSA must be interpreted in such a way to make it work as a whole so that those who incurred costs before its enactment should not be punished when compared to those who did not.
Comment
The decision in Triathlon confirms that an RCO is a powerful weapon designed to shift costs away from leaseholders and onto developers and associated companies. In terms of its application, the "just and equitable" test under Section 124 of the BSA must be interpreted through the lens of public policy aims – specifically, that developers and wealthy associated entities should pay first as being on the top of a "hierarchy or cascade of liability". The CoA's confirmation of the retrospective effect of Section 124 of the BSA will likely broaden the scope of potential future claims particularly on the issue of reimbursement or contributions from those who have incurred remediation costs pre-BSA.
Importantly, Triathlon should not be read in isolation; rather it should be read in conjunction with other recent decisions on the interpretation and application of the BSA, including the Supreme Court's decision in URS which we have previously covered here. That decision confirming the retrospective extension of the limitation period enables developers to recover costs from negligent professionals for historic defects. Notably, the decision stated that developers who behaved proactively and incurred costs when remediating defects could seek a contribution from third parties without having to wait to be sued themselves (which would otherwise reward indolence as noted in Coulson LJ’s leading judgment in the CoA.
Another key case concerning the interpretation of the BSA was the Technology & Construction Court’s recent decision in 381 Southwark Park Road RTM Co Ltd v Click St Andrews Ltd which represented the first High Court finding of a "relevant liability" under Section 130 of the Building Safety Act 2022 and confirmed that findings of liability for building safety can potentially extend beyond the original developer to include associated companies.
Taken together, these recent decisions illustrate the court's determination to uphold parliament's legislative intention when enacting the BSA which was primarily to improve safety standards in construction, to protect leaseholders and to target those responsible as part of a layered liability framework.
Further Reading:
The First Building Liability Order is Made 381 Southwark Park Road | DWF Group
