Probably the heater control/bypass valve, this sits on the engine side of the bulkhead. When the heater is set to cold the internal heater is by-passed completeley by this valve and it only shifts back to letting water pass when the heater is turned on to heat the car interior. On the petrol models is vacuum actuated. It can be identified by following the two inch-and-a-quarter rubber heater hoses that pass thru the bulkead together as a pair, these should go right to the bypass valve. Check this out. Good luck.
Steve
Steve Ball
November 2006