The claimants sought damages against the defendants for their late delivery of a building. The contractors sought to share the damages with the architects who had certified the delays, defeating their own claims.
Held: The Act sought to extend the circumstances under which contributions could be sought, but their claim against the architects were of a different nature to the claims they were defending. For a contribution claim to succeed under the 1978 Act, it had to be shown that the other party was ‘liable in respect of the same damage’. Even a purposive interpretation could not be used to extend the meaning to bring together different claims. The mutual discharge test in Howkins should not be used as a threshold test, but rather a practical test. The damage from delay was different from the damage of transferring legal responsibility for the delay.
Lord Bingham of Cornhill said: ‘It is plain beyond argument that one important object of the 1978 Act was to widen the classes of person between whom claims for contribution would lie and to enlarge the hitherto restricted category of causes of action capable of giving rise of such a claim. It is, however, as I understand, a constant theme of the law of contribution from the beginning that B’s claim to share with others his liability to A rests upon the fact that they (whether equally with B or not) are subject to a common liability to A. I find nothing in section 6(I)(c) of the 1935 Act or in section 1(1) of the 1978 Act, or in the reports which preceded those Acts, which in any way weakens that requirement. Indeed both sections, by using the words ‘in respect of the same damage’, emphasise the need for one loss to be apportioned among those liable.
When any claim for contribution falls to be decided the following questions in my opinion arise. (I) What damage has A suffered? (2) Is B liable to A in respect of that damage? (3) Is C also liable to A in respect of that damage or some of it? At the striking-out stage the questions must be recast to reflect the rule that is arguability and not liability which then falls for decision, but their essential thrust is the same. I do not think it matters greatly whether, in phrasing these questions, one speaks (as the 1978 Act does) of ‘damage’ or of ‘loss’ or ‘harm’, provided it is borne in mind that ‘damage’ does not mean ‘damages’ (as pointed out by Roch LJ in Birse Construction Ltd v Haiste Ltd [1996] 1 WLR 675, 682) and that B’s right to contribution by C depends on the damage, loss or harm for which B is liable to A corresponding (even if in part only) with the damage, loss or harm for which C is liable to A. This seems to me to accord with the underlying equity of the situation: it is obviously fair that C contributes to B a fair share of what both B and C owe in law to A, but obviously unfair that C should contribute to B any share of what B may owe in law to A but C does not.
Approached in this way, the claim made by the architect against the contractor must in my opinion fail in principle. It so happens that the employer and the contractor have resolved their mutual claims and counterclaims in arbitration whereas the employer seeks redress against the architect in the High Court. But for purposes of contribution the parties’ rights must be the same as if the employer had sued both the contractor and the architect in the High Court and they had exchanged contribution notices. The question would then be whether the employer was advancing a claim for damage, loss or harm for which both the contractor and the architect were liable, in which case (if the claim were established) the court would have to apportion the common liability between the two parties responsible, or whether the employer was advancing separate claims for damage, loss or harm for which the contractor and the architect were independently liable, in which case (if the claims were established) the court would have to assess the sum for which each party was liable but could not apportion a single liability between the two. It would seem to me clear that any liability the employer might prove against the contractor and the architect would be independent and not common. The employer’s claim against the contractor would be based on the contractor’s delay in performing the contract and the disruption caused by the delay, and the employer’s damage would be the increased cost it incurred, the sums it overpaid and the liquidated damages to which it was entitled. Its claim against the architect, based on negligent advice and certification, would not lead to the same damage because it could not be suggested that the architect’s negligence had led to any delay in performing the contract.’
A judge who, instead of delivering a judgment orally at the end of the argument, has reserved it to be given at a later date in writing, will circulate a draft of that judgment before handing it down. A judge may alter the draft judgment between circulating it (and receiving comments from the parties) and handing it down.
Judges:
Lord Bingham of Cornhill, Lord Mackay of Clashfern, Lord Steyn, Lord Hope of Craighead and Lord Rodger of Earlsferry
Citations:
Times 26-Apr-2002, [2002] UKHL 14, [2002] 1 WLR 1397, [2002] 1 All ER (Comm) 897, [2003] 1 CLC 11, [2002] TCLR 14, [2002] PNLR 37, [2002] BLR 255, [2002] 2 All ER 801, 81 Con LR 1
Links:
Statutes:
Civil Liability (Contributions) Act 1978 1(1)
Jurisdiction:
England and Wales
Citing:
Disapproved in part – Friends’ Provident Life Office v Hillier, Parker May and Rowden CA 1997
Friends Provident had participated in a development project on terms which required it to pay its share of the development costs as it proceeded. It employed Hillier Parker, a firm of surveyors, to check demands made from time to time for payment of . .
Cited – Hurstwood Developments Ltd v Motor and General and Andersley and Coinsurance Services Limited and Another CA 21-Nov-2001
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Cited – Howkins and Harrison (A Firm) v Tyler and Another ChD 9-Mar-2000
Having paid out andpound;400,000 to a lender as damages for a negligent survey valuation after default in repayments by the defendant, the claimant sought to recover the payment from the defendant under the Act. The application was refused. The Act . .
Cited – Birse Construction Ltd v Haiste Ltd CA 12-Dec-1995
A contribution order was only proper where the damage caused was the same damage to the same person. . .
Appeal from – The Royal Brompton Hospital National Health Service Trust v Hammond and Others CA 23-May-2001
. .
Appeal from – The Royal Brompton Hospital National Health Service Trust v Hammond and Others (No 5) CA 11-Apr-2001
When looking at an application to strike out a claim, the normal ‘balance of probabilities’ standard of proof did not apply. It was the court’s task to assess whether, even if supplemented by evidence at trial, the claimant’s claim was bound to fail . .
Cited – Royal Brompton Hospital National Health Trust v Hammond etc TCC 8-Jan-1999
. .
See Also – Royal Brompton Hospital National Health Trust v Hammond and others TCC 9-Dec-1999
. .
See Also – The Royal Brompton Hospital NHS Trust v Hammond and Others TCC 18-Dec-2000
. .
See Also – Royal Brompton Hospital National Health Service Trust v Hammond and others CA 9-Feb-2001
. .
Cited by:
Cited – NIRU Battery Manufacturing Company and Another v Milestone Trading Ltd and others ComC 8-May-2003
There was a contract for the sale of lead ingots. The sale was supported by letters of credit but inaccurate certificates were issued to release payment. The parties sought now to amend the contributions in the light of the Royal Brompton Hospital . .
Cited – Niru Battery Manufacturing Company, Bank Sepah Iran v Milestone Trading Limited CA 23-Oct-2003
The claimant had contracted to purchase lead from some of the defendants. There were delays in payment but when funds were made available they should have been repaid. An incorrect bill of lading was presented. The bill certified that the goods had . .
Cited – Aer Lingus v Gildacroft Ltd and Another CA 17-Jan-2006
The claimant had been found liable to pay damages for personal injury, and now sought contribution from the defendants. The defendants said that they were out of time since the contribution action had been commenced more than 2 years after the . .
See Also – Royal Brompton Hospital National Health Service Trust v Hammond and others PatC 11-Oct-2002
. .
Cited – Charter Plc and Another v City Index Ltd and others ChD 12-Oct-2006
An employee of the claimant had fraudulently spent several million pounds of the claimant’s money on personal bets through the defendant company. The claimant said that the defendants knew the origin of the funds and were liable to repay them. . .
Cited – City Index Ltd and others v Gawler and others; Charter plc v City Index Ltd CA 21-Dec-2007
A senior employee of Charter had fraudulently spent substantial sums with City Index. City Index had paid out on a claim of knowing receipt, and sought contributions from directors of Charter and their auditors, saying that they had known of the . .
Cited – Nationwide Building Society v Dunlop Haywards (HLl) Ltd (T/A Dunlop Heywood Lorenz) and Cobbetts ComC 18-Feb-2009
The claimant had leant money on a property fraudulently overvalued by an employee of the now insolvent first defendant. A contribution order had been agreed by the solicitors. The court heard applications by the claimants and the solicitors against . .
Cited – Luke v Kingsley Smith and Company and Others QBD 23-Jun-2003
The claimant sued various of those who had represented him in a claim against the Ministry of Defence. He believed that he had had to accept an inadequate sum in settlement after being at risk of losing the claim for non-prosecution. The defendant . .
Cited – Sunderland City Council v Brennan and Others EAT 2-May-2012
EAT PRACTICE AND PROCEDURE – Contribution
PRACTICE AND PROCEDURE – Disclosure
(1) An employment tribunal has no jurisdiction to determine claims for contribution under the Civil Liability . .
Cited – Bath v Escott ChD 11-May-2017
Judgment need not follow hearing transcript
Application to have released the audio recording of a hearing to a county court, the applicant saying that the judgment was not a true record of the hearing.
Held: Rose J explained the status of the various elements: ‘the mere fact that the . .
Lists of cited by and citing cases may be incomplete.
Damages
Updated: 06 June 2022; Ref: scu.171306