The Court of Appeal has dismissed Delta’s appeal against the ruling of Mrs Justice Rose last June, so that Delta is precluded from resisting IMI’s contribution claim on the basis of a limitation defence. The judgment is the latest in a series of ground breaking rulings arising from the Copper Tubes and Copper Fittings claims, in which IMI has now twice been successful in the Court of Appeal.
The judgment concerns section 1(4) of the Civil Liability (Contribution) Act 1978, which applies where the main claim against the contribution claimant (in this case, Travis Perkins’s claim against IMI) has been the subject of a bona fide settlement. Under section 1(4), the liability of the contribution claimant (IMI) to the main claimant (Travis Perkins) cannot be re-opened by the contribution defendant (Delta) if the conditions of a proviso are satisfied – that is, if IMI would have been liable “assuming that the factual basis of the claim against him could be established”. Where section 1(4) applies, the contribution defendant cannot resist the contribution claim on the basis that the contribution claimant was never liable in the first place.
In the present case, Delta sought to resist IMI’s claim for contribution on the basis that the main claim against IMI by Travis Perkins was time barred. Rose J rejected that argument, holding that, under section 1(4), Travis Perkins’ plea in Reply that the cartel was deliberately concealed is assumed to be true; as a result the limitation argument failed.
The Court of Appeal upheld a different interpretation of section 1(4), advanced by IMI, that the proviso only involves an inquiry into whether the Particulars of Claim disclose a cause of action. This new interpretation offers settling parties greater protection from attempts by the contribution defendant to re-open the claim which has been settled. However, the Court also upheld Rose J’s application of the section as a secondary and alternative view.
Please click to view a copy of the IMI PLC & anr -v- Delta LTD & ors judgment.
Paul Harris QC and Rob Williams acted for the successful party IMI.