Expert Witness Journal Issue 68 August 2026 - Flipbook - Page 63
The TCC identi昀椀ed four key questions:
As the court was bound by the default judgment, it
found that Sto’s liability necessarily included that:
What costs were actually incurred?
Were those costs caused by the pleaded defects?
Were the costs reasonable?
What contribution is “just and equitable”?
Issues 1 & 2: Costs and Causation
Mulalley relied on detailed expert and factual
evidence to establish its losses.
The court found:
•
Total remedial costs incurred: £3,431,633.53
•
Costs attributable to the defective cladding
system: £2,025,499.62
•
the Cladding
Regulations;
System
breached
Building
•
Sto had made misleading statements about the
Cladding System;
•
The Cladding System was inherently defective;
and
•
The misleading statements and defects rendered
the apartments un昀椀t for habitation.
Crucially, the TCC determined that the Cladding
System was the primary cause of the loss, even
though there were additional workmanship issues
(such as 昀椀re barrier defects). Those issues were
viewed as derivative of the defective system itself.
The distinction was critical. While the overall
project involved broader works, only those costs
causally linked to the defective cladding system were
recoverable against Sto.
Outcome
Balancing these factors, the TCC held that Sto was
responsible for: 87.5% of the recoverable loss.
Issue 3: Reasonableness of
Remedial Works
This resulted in an award of £1,772,312.17 in favour
of Mulalley.
On reasonableness, the court adopted a familiar
stance seen in earlier building safety cases, citing
Martlet v Mulalley [2022] EWHC 1813 (TCC).
Key Takeaways for the Industry
This judgment o昀昀ers several important insights:
The key principle is that courts are generally
reluctant to second-guess remedial schemes with the
bene昀椀t of hindsight.
A Rare Look at Section149 in Practice
The case provides guidance on the interplay
between s.149 of the BSA 2022 and contribution
claims, an area likely to expand as historic defect
claims continue.
Accordingly, once costs were properly evidenced
and linked to the defects, the TCC treated them as a
reasonable starting point.
Building Liability Orders Are a Powerful Tool
Issue 4: Contribution: A “Just
and Equitable” Apportionment
The successful use of a Building Liability Order
under s.130 of the BSA 2022, even following default
judgment, demonstrates the court’s willingness to
pierce the corporate veil where appropriate.
Mulalley’s claim was ultimately one for contribution
under the Civil Liability (Contribution) Act 1978.
Under section 2(1), the court must determine what
contribution is “just and equitable having regard to the
extent of that person’s responsibility for the damage in
question”.
Default Judgment Does Not Eliminate the Burden
of Proof
Even without a defence, claimants must still prove
causation, quantum, and reasonableness through
evidence.
Mulalley’s Submission
Mulalley argued that Sto’s role should be treated
analogously to that of a design professional (such
as an architect), as the defects stemmed from the
design and performance of the cladding system.
Courts Focus on Primary Responsibility
Where defects stem from a core design or product
failure, responsibility is likely to fall heavily on
manufacturers or designers - even where contractors’
workmanship is imperfect.
It contended that Sto should bear 90% of the
responsibility.
A Measure of Reassurance for Contractors
The judgment may o昀昀er some comfort to design &
build contractors facing large volumes of post-BSA
claims. It shows that liability can be signi昀椀cantly
shared (or shifted) where product defects are the
dominant cause.
The TCC’s Findings
The TCC accepted that the contractor–designer
analogy was appropriate, noting that such cases
often result in contributions in the range of 67% to
80%.
EXPERT WITNESS JOURNAL
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AUGUST 2026
