Cladding manufacturer Kingspan’s legal settlement prevents a precedent-setting court case.
- Shepherd Construction sought £70m against Kingspan and others for unsafe cladding on a London building.
- The Building Safety Act’s Section 149 was central to this case, focusing on manufacturer liability.
- Settlement averts testing this law’s scope, leaving industry liability questions unresolved.
- Remedial works on the disputed building completed six years after the intended date.
Cladding manufacturer Kingspan has reached a legal settlement with Shepherd Construction, which had initiated a claim totalling £70m against Kingspan alongside 10 other companies. The claim involved a high-rise residential development in Colindale, north-west London, where dangerous cladding was allegedly installed. Kingspan’s agreement to settle precludes what was expected to be the first legal evaluation of Section 149 of the new Building Safety Act (BSA), designed to extend the scope of legal claims contractors can pursue against cladding manufacturers.
Section 149 allows parties to recover damages if dangerous cladding made a building unfit for habitation, especially if the cladding manufacturer made misleading statements, failed to meet product standards, or produced inherently defective products. Shepherd Construction had argued that Kingspan knew or should have known that the insulation provided contravened building standards. Despite Kingspan contesting this accusation, maintaining compliance had been verified by third-party assessments in 2016 and 2017, the settlement was reached, leaving the legal boundaries untested.
James Morris of Mayer Brown, representing Shepherd, pointed out that a court ruling could have offered guidance on liability distribution within the industry. This is significant as each cladding case has unique circumstances, though a legal precedent might have influenced future disputes regarding similar cladding systems. Despite the absence of a ruling, Shepherd’s other claims, including those based on existing contract and tort law and the Civil Liability (Contribution) Act 1978, secured over £45m in settlements from the other entities involved.
Court records from July indicate the ongoing nature of related legal proceedings, with a notable hearing still scheduled between Shepherd and Atrium, an underwriting firm, slated for 11 weeks starting October 7, at the Technology and Construction Court. The central block in this litigation forms part of Capitol Way, a project completed in 2015. It featured two specific cladding setups involving Kingspan products, with the necessary remedial actions only concluding in March 2021. This closure was significantly delayed from the initial completion target of June 2015.
These legal disputes highlight ongoing challenges in the construction industry concerning accountability and safety standards. The settlement defers an immediate legal test of the BSA’s implications, leaving industry actors without definitive judicial guidance on cladding product liability.
The settlement leaves unresolved legal questions regarding cladding liability under the Building Safety Act.
