That is your back-flow preventer... it protects your home water supply by preventing water in you irrigation pipes from getting sucked back into the house plumbing. This particular type of back-flow preventer is called a pressure vaccum breaker (PVB).
Beyond that, I can't tell you much more... I'm just a DIY homeowner that uses a different type of backflow preventer.
cool that makes sense now.. i finally figure out how to open it.. (the black thing).. and the spring came off so when the water was pushing up the bonnet (i think) wasnt making a good seal hence the leak!
thanks to this site i managed to fix it already without buying new parts..
thanks again!