Lawbite: Vista Tower RCO remains in force – Upper Tribunal dismisses appeal in its entirety

The Upper Tribunal (“UT”) has dismissed the four grounds of appeal against the Vista Tower Remediation Contribution Order (“RCO”).

In 2025, the First-Tier Tribunal (“FTT”) ordered the second ever RCO which ordered the original developer of Vista Tower in in Stevenage, and 74 of its associates to make payments to Grey in the total sum of c.£13m with each entity ordered to pay being held as jointly and severally liable.

As a result of this dismissal, the RCO as originally ordered remains in full force.

This decision will be of interest to developers of residential buildings in England and companies associated with them, and also to landlords and occupiers of such buildings.

Remediation Contribution Orders

A RCO is a type of order introduced bys.124 of the Building Safety Act 2022 (BSA). Parties including regulators, leaseholders and landlords can apply to the FTT to request a RCO requiring landlords, developers and/or persons associated with them to make a contribution towards the costs of remedying building safety defects in certain buildings. The FTT can only make such order where it is ‘just and equitable’ to do so.

The grounds of appeal:

The UT was to decide four issues:

1. whether s.124 permits a single, joint and several RCO;
2. whether the FTT wrongly eroded the principal of separate corporate identity and whether it was just and equitable to do so in circumstances where many of those associates were not directly involved in Vista Tower’s construction or ownership;
3. whether any risk above a low risk should be regarded as a building safety risk for the purposes of s.120; and
4. whether the FTT’s wide approach to its assessment of costs by including the full cost of replacing the Type 1 wall system was just and equitable.

The UT, in dismissing each of the four grounds of appeal, decided that:

1. the wording in s.124 was subject to statutory construction, and when read within the context of the BSA and with its purpose in mind, the correct construction is that there exists the power to order a RCO against multiple respondents on a joint and several basis;
2. that did not mean that in different circumstances, e.g. in the case of one wealthy parent company within a wider corporate structure holding all the money, it may be just and equitable to single out the wealthy parent company and make an RCO against that entity alone;
3. there is no minimum requirement or nexus required between the original developer and its associates – what will be just and equitable will be fact-sensitive;
4. nor is there a requirement for an associated company to have had direct participation or receipt of profits from the particular development before the FTT can make a RCO against that entity.
5. reference to a risk in the context of a building safety risk under the BSA, means any risk (subject to it satisfying the other conditions for the existence of a building safety risk) and was not confined to risk which can be described as intolerable. In fact the UT went further than the FTT by disagreeing that a risk meant any risk above a low risk; and
6. the assessment of costs is fact-specific and the FTT’s findings were explained and grounded in evidence.

Takeaways:

• This decision clarifies that a building safety risk does not need to be intolerable to justify remediation, a relevant defect is one which causes any risk
• Although it is possible to order an RCO against numerous respondents on a joint and several basis, that is not the starting point, but in such a case it is important that the respondents explain clearly the nature and extent of their ‘associate’ relationship
• Crucially, the UT’s decision reinforces the very wide discretion held by the FTT when determining what is just and equitable for the purpose of ordering RCOs. The UT reinforced this message by refusing to list or limit the factors which could be taken into account by the FTT when reaching its assessment. Understanding this broad discretion is an important consideration when mapping the risk profile of a group structure and where liability might spread
• The distinction between explanatory notes which were in existence at the time that the Act was enacted and which have been published since is material and the latter cannot be relied on as heavily as to Parliament’s intention