Contractor pays out millions to settle civil claim after Grenfell Tower disaster
06 July 2023
UK-based contractor Rydon has paid out nearly £26.7 million (€31.3 million) to settle a civil court claim lodged by people affected by the Grenfell Tower disaster in London.
A fire at Grenfell Tower, on 14 June 2017, claimed the lives of 72 people.
The fire started in a fourth-floor flat at the 23-storey residential block, before spreading rapidly throughout the 1960s building, fuelled by aluminium composite material (ACM) rainscreen cladding and combustible insulation, added during a 2015-2016 refurbishment.
Rydon was the main contractor in charge of the refurbishment works.
It has faced civil proceedings from a group of people who suffered bereavements as a result of the fire, as well as survivors and residents of the block (BSR), alongside several other parties who were subject to a long-running public inquiry into the tragedy, whose hearings finally concluded in November 2022.
The proceedings have taken the form of an alternative dispute resolution (ADR) process, involving the BSR group, companies involved in the inquiry and their insurers.
Rydon made a provision in its accounts for a total of £26.7 million for its share of the settlement.
The company has also made a separate provision in relation to separate discussions with parties not involved in the BSR group, plus members of the fire service, policy and ambulance services who responded to the tragedy.
In a statement issued as part of its financial results for the year to 30 September 2022, Rydon said, “Along with many other contractors and developers, Rydon used cladding in its partial refurbishment of the building which was marketed widely by its manufacturers.
“It is now apparent the manufacturers circumvented fire regulations to assist in the marketing of their products and the certification process was very weak. The government finally admitted publicly five and a half years after the tragedy in early 2023 its acceptance that the relevant Building Regulations were ‘faulty and ambiguous’.
“Consequently, a large number of projects were commissioned by bodies such as housing associations, local authorities and private developers, which deployed similar cladding products on 600 buildings across the UK. Grenfell Tower was only one such project.
“The Royal Borough of Kensington and Chelsea (the client) commissioned architects to undertake the design and then Rydon Maintenance Limited (RML) as the design and build contractor to reclad the tower. RML in turn commissioned a specialist design sub-contractor to carry out and procure the work. A similar process is likely to have occurred on the 600 buildings across the UK.”
Elsewhere in its results, Rydon confirmed its decision to withdraw from the design and build contracting market to reduce its risk to fixed-price construction projects. Its Rydon Homes and Rydon Maintenance businesses continue.
The group saw its turnover including its share of joint ventures fall from £146.8 million (€172 million) in 2021, to £94 million (€110.2 million) in 2022. Its pre-tax profit also fell slightly from £6.2 million (€7.3 million) in 2021 to £5.8 million (€6.8 million) in 2022.
The Grenfell Tower Inquiry is due to issue its final report into the tragedy in 2024.