P worked for cleaning firm X at D’s factory. One of D’s employees, R, negligently injured P. In the contract between X and D, X agreed to indemnify D against the negligence of either party’s servants and agreed that there had to be insurance. P sued D. D claimed indemnity under the contract so that X would have to indemnify D. X had to accept this, but, due to subrogation, insisted on having D’s rights against R so as to reclaim the indemnity it would have to pay for D. CA refused to compel D to lend its title to X to reclaim money from R on the grounds that (1) it would be unfair to do so (Lord Denning argues that the insurance companies can and should bear the burden of compensating X and it would be unfair if an individual such as R should be made liable + it would lead to a strike); and (2) There is an implied term that the indemnity clause does not give rise to any subrogation within the contract (James LJ says that subrogation would be “unacceptable and unrealistic” in the industrial setting but fails to clarify). NB the difference between this case and Lister is that here the indemnification term is explicit since Lister prevented such a clause from being implied, which Lord Denning calls “unfortunate”.
