Have i broken the suspension?

I have Btwin Rockrider 5.1 and have recently been using it as a road bike with skinny wheels and the suspension set to very stiff.
I put its fat tyres back on yesterday and went off road and realised that i needed to soften things up.
The twist control was really stiff and i ended up having to use a small wrench to get it moving. When i looked next I noticed that I twisted it so much the knob was stilling higher than its seating position and i could see a washer inside, also when compressed I could hear air coming out the top of the forks.
So i twisted it back in (took the photo below half way through) and its sitting back roughly where it should.
Have i broken it?
I put its fat tyres back on yesterday and went off road and realised that i needed to soften things up.
The twist control was really stiff and i ended up having to use a small wrench to get it moving. When i looked next I noticed that I twisted it so much the knob was stilling higher than its seating position and i could see a washer inside, also when compressed I could hear air coming out the top of the forks.
So i twisted it back in (took the photo below half way through) and its sitting back roughly where it should.
Have i broken it?

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Posts
yes that is indeed broken. Does it still adjust the springs ? If it does, it probably wont do for long. If its still under warranty take it back other wise you will have to live with what settings you have OR replace the fork or see if someone can effect a repair that lasts more than a few twists
XCTs can be picked up for pennies second hand, but if your going to the trouble of changing it, try for something a bit better, XCMs or XCRs are both fairly inexpensive and available
Which of those 2 are the better fork?
Make sure you get one with Hydraulic damping though, most XCR (but not all) have it and about 50% of XCM (look for an HLO (Hydraulic lockout) not an ML) (Mechanical). XCR is a bit lighter than the XCM as it has Magnesium lowers.
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