Can a Building Liability Order Reach Your Company? 5 Lessons From the Ardmore Collapse Every General Contractor Needs

For general contractors, the Ardmore collapse is a warning that historic building safety liabilities can move far beyond the company that originally carried out the work. It is also a reminder that General Contractor Liability Insurance is not automatically designed to respond to every liability created by the Building Safety Act 2022.

In June 2026, parts of the Ardmore Construction Group entered administration after a £14.9 million Building Liability Order connected to defects at Admiralty Quarter in Portsmouth. Around 275 jobs were lost, subcontractors faced an estimated £5.1 million exposure, and the surety market was reported to be facing potential losses of up to £100 million.

The project had been completed in 2009.

That combination matters. A liability arising from an old project reached seven related group companies, contributed to a major contractor failure and created consequences for employees, subcontractors, developers, insurers and bond providers.

The High Court decision remains subject to appeal, but the practical message for general contractors is already clear: corporate structures, old project files and standard insurance assumptions all need closer examination.

What happened in the Ardmore case?

Ardmore Construction was engaged to design and build the Admiralty Quarter development, comprising 19 residential buildings in Portsmouth. Construction took place between 2007 and March 2009.

Following post-Grenfell investigations, concerns were raised about fire safety defects involving external wall systems, combustible materials, compartmentation and fire stopping. In August 2025, an adjudicator found Ardmore liable under the Defective Premises Act 1972 and awarded approximately £14.9 million.

Ardmore Construction entered administration. Crest Nicholson then applied for Building Liability Orders under sections 130 and 131 of the Building Safety Act, seeking to extend the relevant liability to associated group companies.

On 1 April 2026, the Technology and Construction Court granted both an anticipatory BLO and an order making seven associated Ardmore companies jointly and severally liable for the adjudicated sum. The Court’s approach showed that a claimant does not necessarily have to stop at the original contracting entity where the wider corporate group is associated with it and extending liability is considered just and equitable.

This is not a general removal of separate legal personality. It is a statutory route that can, in practical terms, reach beyond the company that signed the original contract.

Hand-drawn illustration of a contractor group structure with related companies connected by highlighted lines

Lesson 1: A BLO can target the group, not just the insured company

Many contractors insure each trading entity separately. That can be sensible for accounting, contracting and operational reasons, but it does not mean that risk is neatly separated when the Building Safety Act applies.

A Building Liability Order may extend a relevant liability from the original company to associated companies. The Court will consider the facts, the corporate relationships, the history of the liability and whether it is just and equitable to make the order.

For a general contractor, the first practical exercise is therefore a group structure review.

Ask:

Which company signs construction contracts?
Which company employs site staff?
Which company owns plant, property or retained profits?
Are historic liabilities held in a different entity?
Have businesses been reorganised, transferred or placed under a new parent?
Do policy schedules identify every relevant company?
Do the insurance wordings include the correct subsidiary and associated company provisions?

A policy covering the main trading company may not respond in the same way to a statutory liability imposed on another group company. Even where an extension exists, there may be different limits, conditions, aggregation provisions and exclusions.

This is where a broker’s involvement matters. A proper review should look at the group chart and the claims history alongside the policy wording, rather than treating a certificate of insurance as the complete answer.

Lesson 2: Legacy projects do not simply disappear

The Ardmore project was completed in 2009. That is a long time in construction. People change jobs, companies restructure, records move to storage and insurers may be replaced several times.

The Building Safety Act introduced significant changes to how historic building safety claims can be pursued, including extended limitation periods for certain claims. The result is that a project which appeared closed may still create financial and legal exposure many years later.

Hand-drawn illustration of a completed residential building, an old blueprint and a timeline from 2009 to the present

This creates a particular challenge for SMEs. Larger contractors may have dedicated legal, technical and compliance teams, but smaller firms often rely on directors remembering what happened and where the documents were kept.

That approach is not robust enough.

For each significant project, retain:

The contract and amendments
Design responsibility records
Employer’s requirements and specifications
Subcontractor appointments
Product and material approvals
Inspection and test plans
Building control correspondence
Fire strategy and engineering documents
Site photographs
Completion certificates
Defect and remediation records
Details of the insurers notified at the time

Good records will not remove liability, but they can help establish what was designed, supplied, inspected and approved. They may also support contribution claims against designers, subcontractors, manufacturers or other responsible parties.

Lesson 3: Insurance exclusions are different from uninsurable liabilities

A common assumption is that if a company has public liability or Construction Contractor Insurance, the insurer will deal with any claim arising from defective construction work.

That is not how most policies operate.

Public liability insurance is generally intended to cover legal liability for injury to third parties or accidental damage to third-party property. It is not automatically a warranty that the contractor’s work will be fit for purpose. The cost of correcting defective work, improving a design or replacing faulty materials may be excluded, particularly where the loss is treated as a contract liability or a rectification cost.

A Building Liability Order creates an additional complication. It is a statutory mechanism that can make an associated company jointly and severally liable for a relevant liability of the original body. A standard policy may not have been written to respond to that type of exposure, particularly where:

The company was not the original contracting party
The liability relates to a project completed many years ago
The claim concerns fire safety or structural defects
The loss is a remediation cost
The policy contains defective workmanship or contract liability exclusions
The company was not named as an insured at the relevant time

That does not mean every BLO-related claim is automatically uninsured. It means the answer depends on the specific policy wording, the applicable policy period, the nature of the underlying liability and how the claim is presented.

Directors should not wait for a claim before asking these questions. Our earlier guide on the clause in contractors insurance that could leave you uncovered explains why the detail of a contractors policy matters.

Lesson 4: Bonds and retentions are changing the risk conversation

The construction sector has relied heavily on retentions, parent company guarantees and performance bonds to manage project risk. That balance is changing.

The proposed Small Business Protections (Late Payments) Bill includes reforms aimed at restricting payment terms to 60 days and banning construction retentions, subject to parliamentary passage and implementation arrangements. The Bill does not necessarily require every retention to be replaced with a surety bond, but the commercial effect is likely to increase pressure on contractors and clients to find alternative security.

That is important because surety capacity has already been tested by contractor failures including Buckingham, ISG, Readie and Henry. Market reporting has put the wider UK surety market at roughly £200 million of annual premium in normal conditions, while construction bond premium volumes have at times exceeded £1 billion as demand and pricing increased.

The Ardmore failure adds another major loss event. Performance bonds may be called when projects stop, contracts are terminated or replacement contractors are appointed. Subcontractors, meanwhile, may lose retentions and unpaid applications at the same time.

For general contractors, the practical actions are to:

Understand every bond, guarantee and indemnity given to a client
Check whether the bond is on-demand or conditional
Model the cash-flow impact of a bond call
Review counter-indemnity obligations
Keep payment applications and variations properly documented
Discuss bond requirements with your broker before signing a contract

Hand-drawn illustration of a surety bond, shield, hard hat and organised project records

Lesson 5: Evidence-based governance is becoming part of insurability

The construction industry often talks about the “golden thread” in relation to building safety information. For contractors, the wider principle is straightforward: insurers, courts, developers and funders increasingly want evidence, not assurances.

It is not enough to say that a competent person inspected the work. You should be able to show who inspected it, when they did so, what they found, what was changed and who approved the change.

Insurers are likely to look favourably on contractors that can demonstrate:

Clear responsibility for design and compliance
Formal approval of material substitutions
Consistent site inspection records
Documented subcontractor competence checks
A controlled process for variations
Regular board review of legacy liabilities
A live register of claims, complaints and potential defects
Proper notification to insurers when circumstances arise

This is not about producing paperwork for its own sake. It is about being able to reconstruct decisions years later, when the people involved may no longer be available.

What should general contractors do now?

The Ardmore case does not mean every construction business faces a £14.9 million claim. It does mean that a standard liability certificate is not a complete risk-management strategy.

I recommend that general contractors arrange a structured review covering:

Corporate structure: Identify every company that has carried out, owned or benefited from construction work.
Legacy projects: Create a register of completed projects, particularly residential and higher-risk buildings.
Insurance wording: Check defective work, contract liability, pollution, professional services and building safety provisions.
Bonds and guarantees: Understand the financial consequences of calls and counter-indemnities.
Records: Confirm that project information is accessible, complete and securely retained.
Broker engagement: Ask for advice before renewing, restructuring or accepting a major contract.

At Moyak Insurance Services, we take an individual approach because no two contractors have the same projects, group structure or appetite for risk. As a Business Insurance Broker serving Essex, Kent and London, we work with leading UK insurance markets to assess the cover against the work you actually undertake, not just the description written on a proposal form.

Our focus is simple: care about every client, identify the gaps early and help you choose protection that fits your business and budget. That may include a broader commercial combined insurance policy, public liability, employers’ liability, professional indemnity, contract-specific insurance or advice on bonds and guarantees.

The key lesson from Ardmore is not to panic. It is to stop assuming that a liability belongs only to the company that carried out the work, or that a standard policy will automatically follow it. Review your group structure, revisit your old projects and ask your broker to explain what your insurance does : and does not : cover before a Building Liability Order makes the question urgent.

This article is for general information only and is not legal advice. The Ardmore proceedings and related appeal may continue to develop. Contractors should obtain specific legal and insurance advice based on their own circumstances.