Farstad Supply AS v Enviroco Ltd & Anor [2008] ScotCS CSOH_63 (23 April 2008)

Farstad Supply AS v Enviroco Ltd & Anor [2008] ScotCS CSOH_63 (23 April 2008)

Where a contractual indemnity predating the loss excludes the third party's liability in damages to the pursuer, the third party is not a person who, if sued, might have been held liable under section 3(2) of the 1940 Act, and thus no right of contribution arises for the defender.

Citation
[2008] ScotCS CSOH_63
Parties
Pursuer: Farstad Supply AS; Defender: Enviroco Limited; Third Party: ASCO UK Limited
Jurisdiction
Scotland
Judgment Date
23 April 2008
Procedural Posture
Civil Action for Damages and Contribution / Opinion Following Procedure Roll Debate
Outcome
Defenders not entitled to contribution from third party; pursuers' plea upheld.
Legal Topics
Indemnity Clauses, Contribution Between Wrongdoers, Interpretation of Statutory Contribution Rights, Allocation of Risk in Contracts
Contract Law Tort/delict Maritime Law Indemnity Clauses Contribution Between Wrongdoers Interpretation of Statutory Contribution Rights Allocation of Risk in Contracts

Case Brief

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Parties

Farstad Supply AS

Pursuer

Enviroco Limited

Defender

ASCO UK Limited

Third Party

Procedural Posture

Civil Action for Damages and Contribution / Opinion Following Procedure Roll Debate

Legal Issues

  1. 1 Whether a contractual indemnity prevents a defender from seeking contribution from a third party under section 3(2) of the Law Reform (Miscellaneous Provisions) (Scotland) Act 1940
  2. 2 Proper construction of 'defend, indemnify and hold harmless' in a charterparty

Ratio Decidendi

Where a contractual indemnity predating the loss excludes the third party's liability in damages to the pursuer, the third party is not a person who, if sued, might have been held liable under section 3(2) of the 1940 Act, and thus no right of contribution arises for the defender.

Court Disposition

Defenders not entitled to contribution from third party; pursuers' plea upheld.

Orders

  • Exclusion from probation of specified averments in the defences and answers.
  • Repelling the fifth plea-in-law for the defenders.