One Hyde Park Limited v Laing O'Rourke Construction South Limited

Summary

The freeholder of the One Hyde Park development in Knightsbridge sued the contractor that built it for serious defects, principally in the chilled water pipework. The claim was brought under a collateral warranty by which the contractor had warranted its performance to the freeholder.

Shortly before trial the contractor said it was entering liquidation and would not take part. The trial went ahead in its absence, with the freeholder opening its case and calling its evidence, and the freeholder still had to prove its claim.

Mrs Justice Jefford gave judgment for the freeholder. She accepted the unchallenged expert evidence on the cost of the remedial works after scrutinising it, and awarded more than 34 million pounds for the chilled water pipework alone, with further sums for the other defects, bringing the total judgment to about 35 million pounds.

Background and facts

One Hyde Park, a development of luxury flats in Knightsbridge, was completed in 2011. Laing O'Rourke had built it under a main contract of 2007 with the original developer. In 2010 it gave a collateral warranty to One Hyde Park Limited, warranting that it had performed the main contract in accordance with its terms. The freehold was transferred to that company in 2014.

The freeholder alleged serious defects, in particular in the chilled water pipework, which had suffered dozens of leaks between 2017 and 2022, along with failed valves and a defective facade access cradle. It claimed the cost of the remedial works under the collateral warranty.

The trial was listed for early 2025. Shortly before it, the contractor's solicitors said the contractor was entering liquidation and no longer intended to participate. The trial proceeded as a hearing at which the freeholder opened its case and adduced evidence to prove it.

The issue

The court had to decide whether the freeholder had proved, on its evidence, that the defects existed and were the contractor's responsibility under the collateral warranty, and what the reasonable cost of the remedial works was, notwithstanding that the contractor was not there to challenge the case.

The decision

Mrs Justice Jefford gave judgment for the freeholder. The absence of the contractor did not relieve the freeholder of the burden of proving its case, and the court examined the evidence rather than simply accepting the pleaded figures.

The judge was satisfied that the freeholder had made out its case on the defects, and she scrutinised the expert's approach to the cost of the works before accepting it, finding that he had assessed the costs carefully and independently. On the largest item, the chilled water pipework, she accepted the expert's revised assessment:

"I accept his unchallenged evidence of this assessment and will give judgment for the claimant in this amount."Mrs Justice Jefford, paragraph 96

That item alone came to 34,437,122.60 pounds. She also worked through the disputed duration of the remedial works, about ten and a half years, and was satisfied on the evidence:

"I am satisfied that OHP has made out its case on this matter."Mrs Justice Jefford, paragraph 86

Adding the chilled water pipework to the other items, including the failed valves, leaking soldered joints and the facade access cradle, the total judgment came to about 35 million pounds.

Practical implications

A collateral warranty gives a later owner a direct claim against the original contractor. The freeholder here did not build the development and was not a party to the main contract, but the collateral warranty entitled it to sue the contractor for defective work as if it had the benefit of the main contract obligations. Owners and funders should secure collateral warranties, and contractors should remember that these warranties expose them to claims from parties down the line for many years.

A defendant's absence does not hand the claimant a win. Even where the contractor did not attend and did not challenge the evidence, the claimant still had to prove its case, and the court tested the expert evidence before accepting it. A claimant proceeding to trial in the defendant's absence should present a properly evidenced case, because the court will assess it, not rubber-stamp the pleaded sums.

Unchallenged expert evidence still has to persuade the court. The judge accepted the cost assessment because she found it careful and independent, rather than because it was unopposed. A claimant relying on unchallenged evidence should ensure it is sound and even-handed, and an expert should show that they have weighed points against their assessment as well as for it.

Letting a subsidiary fail is not a costless way to avoid a claim. The contractor's decision to enter liquidation rather than defend did not stop the freeholder obtaining a substantial judgment, which stands against the company. Groups considering that course should understand that the claim proceeds and the judgment is entered, with the consequences that follow for the insolvent entity.

One Hyde Park Limited v Laing O'Rourke Construction South Limited [2026] EWHC 155 (TCC), Technology and Construction Court, The Honourable Mrs Justice Jefford DBE. Judgment handed down 2 February 2026.