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Contribution claims—Court of Appeal clarifies CL(C)A 1978, s 1(4) (W.H. Newson Holding v IMI)

Published on: 28 July 2016
Published by: LexisPSL
  • Contribution claims—Court of Appeal clarifies CL(C)A 1978, s 1(4) (W.H. Newson Holding v IMI)
  • Practical implications
  • How did the contribution issue arise in this case?
  • What does CL(C)A 1978, s 1(4) provide?
  • The background and authorities on CL(C)A 1978, s 1(4)
  • Sir Colin Rimer's clarification of CL(C)A 1978, s 1(4)
  • The concept of a 'collateral defence' (para [47])
  • Reading CL(C) 1978, s 1 as a whole (paras [48]–[53])
  • How far does the 'factual basis' under CL(C) 1978, s 1(4) extend (paras [54]–[62])?
  • The Court of Appeal still dismissed Delta's appeal
  • More...

Article summary

Dispute Resolution analysis: Sir Colin Rimer has clarified the scope of the proviso in section 1(4) of the Civil Liability (Contribution) Act 1978 (CL(C)A 1978). Thus, where a defendant (D1) has concluded a bona fide settlement with the claimant (C) then D1 can pursue a contribution claim against D2 irrespective of whether D1 was or was not liable to C, provided that D1 can show that the factual basis would have disclosed a reasonable cause of action against D1 such as to make him liable in law to C in respect of the damage. If he can do that, he will be entitled to succeed against D2. To the extent that Chadwick J in Hashim decided that the subsection permits D2 to raise an inquiry as to whether, in light of any collateral defence raised by D1 to C's claim, C would not have been actually liable to C, it was wrongly decided. This is consistent with the key drivers of the formulation of the sub-section as identified in the Law Commission Report of 1977. or take a trial to read the full analysis.

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