A defendant may feel that another person caused or contributed to the loss which a claimant is trying to recover in court.
If so, the defendant will seek a contribution from that third party for the payment of any damages the claimant is awarded or towards any settlement.
In principle, the defendant has two main options.
It can join the third party into the main proceedings or it can wait to see if the claim is successful and then commence a further contribution claim against the third party.
Joining the third party to the main claim is the simpler approach and it removes the need for issuing separate proceedings and ensures that the third party is part of the court process and be cross examined.
This is know as a “Part 20 Procedure” and results in the question of contribution being heard as part of the same set of proceedings as the main claim.
This can bring forward the time at which any contribution from the third party is actually paid (meaning that the defendant does not need to carry the whole liability pending further proceedings).
However, it may also increase the costs in the short term (as there are three or more parties participating in the dispute), introduce another ‘front’ on which to fight and potentially lead to more days in court and also lead to ‘cut-throat’ defences where each defendant tries to blame the other.
Also, if the judge decides that the claimant’s claim fails then the defendant may (despite having actually won) become liable for the costs of the third party whom it dragged into the proceedings (see the recent case of Wagenaar v Weekend Travel Ltd t/a Ski Weekend).
The alternative is to wait for judgment and then, if the defendant is held liable for the claimant’s loss, issue fresh proceedings for contribution against the third party under the Civil Liability (Contribution) Act 1978.
This delays the time for payment to be obtained and requires a whole new set of proceedings.
However, as a recent Court of Appeal case demonstrates (Chief Constable of Hampshire v Southampton CC)http:, claims under the Civil Liability (Contribution) Act are subject to special limitation periods and the defendant will have to issue proceedings against a third party within two years from either the date of judgment in the original claim; or from the date on which the main proceedings settled.