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On appeal from: [2014] EWCA Civ 562.

The Supreme Court has unanimously dismissed the appeal of the appellant Council, in a case concerning the payment of compensation under the Building Act 1984, s 106, where loss is caused to a business as a result of emergency action.

The appellant Council had exercised emergency powers to restrict public access to a pier on the grounds that it was in a dangerous condition due to serious structural defects. The respondent sought compensation from the appellant for the loss it suffered as a result of the closure. The appellant had argued that it was not liable to pay compensation, alleging that there had been a breach of the Occupiers Liability Act 1957 and the Health and Safety at Work Act 1974, which amounted to a “default” that precluded the respondent from claiming compensation under the 1984 Act.

Lord Carnwarth gave the only judgment, with which the other Justices agreed.

In this instance, the emergency action taken by the appellant was in response to the state of the pier, combined with a fear of possible collapse from crowd-loading during events. The emergency action had not been triggered by the fact that specific repairs had not been carried out by the business for which the respondent now acted as assignee. While this business may have been in breach of duties to clients and employees, it was not “in default” for the purposes of the 1984 Act. The respondent was thus entitled to succeed in its claim for compensation.

For judgment, please download: [2016] UKSC 50
For Court’s press summary, please download: Court’s Press Summary
For a non-PDF version of the judgment, please visit: BAILII

To watch the hearing, please visit: Supreme Court website (23 June 2016 morning session)