Section 1(1) of the Civil Liability (Contribution) Act 1978 (the Act) provides that any person liable in respect of damage suffered by another may recover a contribution from any other person liable in respect of the same damage.
Section 1 (4) of the Act provides that if a person has settled or compromised a claim in good faith, that person is entitled to recover a contribution without regard to whether or not he "is or ever was liable in respect of the damage, provided however that he would have been liable assuming the factual basis of the claim against him could be established".
In this case IMI had settled the original claim against them which had been based on European Commission findings that a cartel had operated in the market for copper and copper alloy fittings between 1998 and 2004. IMI had argued that the claim, issued in 2012, was time barrred. The claimants in turn had argued that IMI had deliberately concealed the cartel. IMI settled the claim in 2014, leaving only its contribution claim against another defendant, D2.
Overruling High Court authority to the effect that there could be an investigation into the first defendant's collateral defence, not denying the factual basis, such as a limitation defence, (Arab Monetary Fund v Hashim and others (judgment of 28 May 1993, unreported)), the Court of Appeal held that the second defendant could not defend the claim by the first defendant on the basis of a collateral limitation defence that could have been taken by the first defendant (here IMI).