Author: IISTL

Today’s Supreme Court decision in SSAFA v Allgemeines Krankenhaus Viersen GmbH [2022] UKSC 29 on the applicability of the Civil Liability (Contribution) Act 1978, while eminently sensible, is not of enormous practical significance. Nevertheless it is still worth noting, especially by indemnity insurers.

As long ago as 2000 Harry Roberts, a British forces’ child, suffered a mishap at the time of his birth in Germany, owing allegedly due to the negligence of a midwife employed by SSAFA (behind whom stood the MoD). SSAFA, having been sued in tort, argued that the fault, or at least part of it, was that of the German hospital where Harry had been born, and sought contribution from it. At this point a problem arose. Under the then English conflict of laws rules the contribution claim, like the claim against SSAFA, was governed by German law; and whereas it would have been in time in England under the Civil Liability (Contribution) Act 1978, under the equivalent German law it was statute-barred.

Nothing daunted, SSAFA claimed over in England against the German hospital under the 1978 Act. Moreover, much to the discomfort of conflicts lawyers here, they succeeded, both at first instance and on appeal. The reason was a holding by Soole J and a and a majority of the Court of Appeal, that the 1978 Act by its wording was applicable as a matter of overriding law to all proceedings in England, however tenuous their connection with this jurisdiction, and to that extent excluded any reference to foreign law under what would otherwise be our rules of private international law. This conclusion, it was said, followed both from the fact that the Act provided for contribution arising out of liabilities arising under foreign law, and expressly superseded all other non-contractual rights to contribution.

Such an exercise in projecting the English private law of contribution willy-nilly onto foreigners involved in transactions abroad is of course theoretically possible, given Parliamentary sovereignty. But it seems, to put it mildly, hard to justify such exorbitancy. Moreover it certainly appears nowhere expressly in the 1978 Act, as pointed out by Lord Lloyd-Jones, giving the Court’s judgment. The Court were unanimous in discountenancing the holdings below, and confirmed, much to everyone’s relief (except that of the MoD, who may well now have to foot a much bigger bill than they thought) that there was nothing so special about the 1978 Act. It was simply an ordinary brick in the edifice of English private law, apt like any other to be pulled out where some other system of law fell to be chosen to govern a transaction under the rules of private international law.

Roberts was a pre-Rome II case: but as regards litigation today its upshot is that we are back to art.20 of Rome II, which says that claims for contribution are governed by the same system of law that controls the original claim out of which the contribution claim arose. This could be significant. Take, for example, the case where because of the negligence of one of the investor’s local advisers, a real estate transaction undertaken by an English investor in Ruritania fails or money is stolen from an account held in Ruritania. The indemnity insurers of the adviser now at least know where they stand. Even if they sue in England any claim against others in Ruritania, whether the fraudster or someone else, will fall to be governed by whatever passes for a contribution regime in Ruritania, whether this is more or less generous than the regime here. Simple. And right.