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Niru has split into two parts:

(1) is CAI liable in UE to the claimants, and is SGS liable in tort to the claimants in respect of the same series of transactions?

(2) if so, then does a contribution or reimbursement claim lie between them?

In answer to (1) Moore-Bick J said yes, to both: [2002] EWHC 1425 (Comm); the CA has now affirmed him in a decision that contains some interesting discussion of the change of position defence by Clarke and Sedley LJJ:

http://www.bailii.org/ew/cases/EWCA/Civ/2003/1446.html

This means that (2) remains a live issue. The problem is that following Royal Brompton NHS Trust v Hammond no claim could lie under the Civil Liability (Contribution) Act 1978 because a claim in UE is not relevantly a claim in respect of 'damage' as required by the Act. Moore-Bick J got around this problem by holding that in a case where C owes X a liability in UE, and D owes X a liability in tort (or vice versa), C can recover some or all of his payment to X from D by acquiring X's rights against D via (reviving) subrogation. At the same time, though, Moore-Bick J also held that a direct claim for contribution or reimbursement will not lie: [2003] EWHC 1032 (Comm).

I think I must be missing something here, because I can't see why he is willing to allow recovery via one route but not via the other. In my view reviving subrogation could only be available for reasons that would compel the conclusion that the reimbursement or contribution claim was available too, and I should also have thought that the availability of the direct route to recovery would then make subrogation redundant in the absence of any secured claim to which C might be subrogated.

The result seems like a good one, since it is clearly unsatisfactory that a meritorious contribution claimant should be left without a remedy because of gaps in the courts' jurisdiction under the 1978 Act, but the reasoning seems unduly complex. I expect that part 2 will now follow part 1 to the CA, and so we must hope that they sort it all out for us there.

Charles