BLOs can be granted against relevant Adjudication awards

On 1 April the Technology and Construction Court handed down the judgment in Crest Nicholson Regeneration Ltd and others v Ardmore Construction Ltd (in Administration) and others [2026] EWHC 789 (TCC). This is only the second High Court judgment handed down in relation to the ‘just and equitable’ test for Building Liability Orders (BLOs) (for comments on the first judgement and more information on BLOs, see our previous article here). The decision contains some key guidance in relation to when it will be just and equitable for the court to grant a BLO, including 1) BLOs can be awarded in advance of any finding of liability, 2) BLO’s can be awarded against a proportion of the liability, rather than the whole liability and 3) BLOs can be awarded in relation to payment of an adjudication award.

This third point noted above had not previously been raised in court, and may be of particular interest to those involved in building safety disputes, as this means that not only can adjudication be utilised as a quick process for obtaining an award for the costs of remedial works in a building safety context, but that entities associated with the liable party can also be held jointly and severally liable for paying sums awarded in adjudication, without the need for the claimant to first litigate the dispute in court.

Background

On or around 13 December 2005 Crest Nicholson Regeneration Ltd (CNR) engaged Ardmore Construction Ltd (ACL) for the construction of a development including 18 residential apartment buildings and a 21-storey tower, of which five of the buildings and three towers have a top storey which is more than 18m above ground level. The parties entered into a contract based on the JCT 1998 Standard Form of Building Contract with Contractor’s Design with amendments, although the contract was never formally entered into as a deed (the D&B Contract).
Post 2017, third party investigations found that the external wall systems at the development were defective in a number of ways and posed a fire safety risk to the occupants.
In May 2025 CNR (and another Crest company) commenced an adjudication against ACL for claims under the D&B Contract, including a claim for breach of duty under section 1 of the Defective Premises Act (‘DPA’) in relation to building safety.
On 29 August 2025 the adjudicator issued a decision that the external wall defects amounted to a breach of ACL’s duties under the DPA and ACL should pay c.£14.9 million (the ‘Adjudication Decision’)
ACL went into administration the day before the Adjudication Decision was issued.
CNR (and other Crest companies) then brought an application for BLOs against a number of companies associated with ACL in respect of 1) any liability which ACL may ultimately be found to owe pursuant to section 1 of the DPA and 2) the sum awarded against ACL in the Adjudication Decision.

Can a BLO be granted against an adjudication award?

The judgment provides guidance and comments on various important and interesting points in relation to the granting of BLOs, including who can make an application and the consideration of a considerable number of arguments raised by ACL and the BLO defendants. For those of you interested in this area, I strongly recommend reading the judgment in full. But for the purposes of this article, I would like to focus on the interaction between the BLO application and the Adjudication Decision.

As noted above, CNR had already been awarded the sum of £14.9 million as a result of an adjudication. ACL had participated in the adjudication but had gone into administration the day before the decision was issued. CNR then found itself in the unfortunate position of having incurred the costs of a full adjudication and having obtained a substantial award against ACL but being unable to recover the awarded sum from ACL, due to ACL’s insolvency.

Part of the BLO application was for the BLO defendants to be jointly and severally liable with ACL for payment of the Adjudication Decision. This part of the judgment itself runs to many pages and involves detailed consideration of a large number of arguments, some of which were project specific (for example, the involvement of different Crest entitles). For the purposes of this article, I have set out a selection of the key arguments raised by the BLO defendants in relation to liability for the Adjudication Decision as follows:

The temporarily binding nature of an adjudication decision means that, in principle, it cannot constitute a ‘relevant liability’ for the purposes of the Building Safety Act;
The claim under the DPA was not a dispute ‘under’ the D&B Contract, which therefore meant that the adjudicator had no jurisdiction to hear the dispute; and
The making of an adjudication BLO would not be just and equitable.

What did the court decide?

Does the temporarily binding nature of an adjudication decision mean that, in principle, it cannot constitute a ‘relevant liability’ for the purposes of the Building Safety Act?
The court found that an adjudicator’s award does create a ’relevant liability’ for the purposes of the BSA. An adjudicator’s decision is binding until the dispute is finally determined by the court or in arbitration. But this interim status still creates a liability which, if not challenged (as many adjudications are not) will be a binding determination of a party’s liability for all time. Also, the failure to comply with the adjudicator’s decision is itself a liability which is capable of being a ‘relevant liability’ for the purposes of the BSA.
Was the claim under the DPA a dispute ‘under’ the D&B Contract for the purposes of the adjudicator’s jurisdiction?
This argument had already been raised by ACL in the case of BDW Trading v Ardmore Construction Limited [2024] EWHC 3235 (TCC) and in that case the court had determined that a similarly worded adjudication clause did provide the adjudicator with jurisdiction over a claim under the DPA. While the court had granted permission for ACL to appeal the point, ACL had not done so after it went into administration. The court in this case agreed with the previous decision and confirmed that the phrase ‘under the contract’ included the jurisdiction to consider a claim brought under the DPA for works carried out pursuant to the construction contract.
The BLO defendants argued that the making of the adjudication BLO was not just and equitable because:
1. Adjudication is an interim solution.
  – The court disagreed with this on the same basis as noted in point 1 above.
2. There is no cash flow need for CNR.
  – The court found that this was irrelevant. The benefit and purpose of the legislation goes beyond short-term cashflow needs.
3. This is a BLO by the back door.
  – The court disagreed with this argument on the basis that if the Adjudication Decision created a relevant liability, then CNR were entitled to seek a BLO in relation to that liability.
4. The BLO defendants’ financial position was such that payment of the £14.9 million sum would present profound problems for the group.
  – The court found that the documentary evidence made available to the court did not support this argument. But in any event, in most cases, the extent of the BLO defendant’s liabilities or assets would not carry much weight when considering whether it was just and equitable to grant the BLO. The court commented that otherwise this could lead to a bizarre outcome that commercially unsuccessful builders were able to avoid the application of the BSA, when commercially successful ones could not.
5. A cheaper remedial scheme was available.
  – The court considered that little weight should be attached to this point. If the BLO defendants wanted to argue the quantum, then it was open to them to do so via court proceedings and any overpayment could be recovered through those proceedings if appropriate.
6. ACL was compromised in its ability to defend the adjudication given the short timescale it faced to produce its Response (in contrast to the time taken by CNR to launch the adjudication).
  – The court dismissed this argument on the basis that the BLO defendants had been aware of the matters in dispute for a long time and had made a commercial decision at some point to attempt to ringfence the liabilities of ACL from the wider group rather than continue to spend time and money engaging with the underlying dispute. This was their own commercial decision, but this did not affect CNR’s statutory rights to seek to recover the awarded sums via a BLO.
7. The Adjudication Decision did not reflect the claim as the sums awarded by the adjudicator did not reflect the latest quantum claimed by CNR or the likely cost of the remedial works
  – The court found that these arguments did not go to the enforceability of the Adjudication Decision and therefore did not touch on whether it was just and equitable to grant the BLO in relation to payment of the adjudicator’s decision. Any overpayment could be recovered in the future via court proceedings.

There was also an argument that enforcement of the Adjudication Decision was not procedurally before the court because CNR had not made an application for summary judgment in respect of enforcement of the Adjudication Decision and the BLO defendants argued that the BLO application was not the appropriate vehicle for determination where it was not an application for summary judgment. The court found that no separate application for summary judgement adjudication enforcement was required, but that if it had been, the court would have granted permission for CNR to amend its application to bring a summary judgment application against ACL and the court would have summarily determined that the adjudicator’s decision should be enforced.

In this case, the court granted the BLO application in respect of the Adjudication Decision and determined that it was just and equitable that each of the BLO defendants was jointly and severally liable to ACL for the sums owed by ACL under the Adjudication Decision.

Key takeaways

Adjudication remains a speedy and cost-effective forum for resolving construction disputes, including building safety claims under the DPA.
Adjudication decisions in relation to building safety claims, while interim in nature, will still constitute a ‘relevant liability’ under the BSA.
A Claimant can apply for a BLO against associated companies of the paying party for payment of a sum awarded in adjudication in relation to a building safety claim.
The court’s judgment provides some clear guidance about when it will be considered ‘just and equitable’ to grant a BLO in these circumstances.

This is a significant decision for parties attempting to recover the costs of remedial works for building safety claims under the DPA. This judgment confirms adjudication as an attractive quick route of recovery, with the potential for a BLO providing protection for the claimant from contractor insolvency and/or failure to pay sums awarded at the end of the adjudication process.