How bad is the damage and what is the fault? If it is a fault that can be related to dropping it I'm not sure what would happen there.
Can they prove that the fault is related to the damage? If not. I'd be seeking advice from fair trading...
Or go through insurance if u have it.. but make it clear to Vodafone that they can stick it where the sun don't shine and go elsewhere. Its amazing how these places dont care for their customer base. No wonder Apple have been crowned for their exceptional customer service, because no one else gives a shit but them!!