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Fundamental Dishonesty in Personal Injury Claims

Medico Legal

by Kelvin Farmaner, Trethowans Solicitors

A 2018 High Court decision provides a useful clarification as to when a dishonest Claimant’s personal injury claim will be dismissed in its entirety, even if parts of the claim were valid. This is likely to mean a more robust stance can be taken by many insurers or others facing such claims when fraud is suspected.

In the case of London Organising Committee of the Olympic & Paralympic Games (In Liquidiation) v Hayden Sinfield (2018) The Claimant (C) had broken his left arm and wrist whilst acting as an assistant to spectators at the 2012 Olympic and Paralympic Games. The Defendant (D) admitted liability. Part of C’s case that he had incurred gardening expense as a result of his injuries as he had to employ a gardener, whereas he and his wife had previously carried out these tasks. The gardening expenses element of the claim was just short of £14,000. Invoices were disclosed which were said to have been rendered by the gardener. D approached the gardener who said he had been working for C for many years and that his level of work did not change as a result of the accident. The gardener also said that the invoices provided in the case were not from him.

At the initial County Court hearing D had applied to dismiss the claim by reference to Section 57 of the Criminal Justice and Courts Act 2015. Section 57 gives the Court power to dismiss a claim if a Claimant has been fundamentally dishonest about it. The County Court Judge declined to dismiss the claim finding that C had not been dishonest, but rather “muddled, confused and careless”, in relation to the preliminary schedule of loss; he had been dishonest in creating false invoices and in stating in his witness statement that the accident had caused him to employ a gardener for the first time; the dishonesty did not contaminate the entire claim; there was a genuine claim for personal injuries which “went wrong” when C was careless and then dishonest; C had not been fundamentally dishonest, but if he had been it would be substantially unjust for the entire claim to be dismissed when the dishonesty related to a peripheral part of the claim and the remainder of it was genuine.

Reversing the first instance decision the High Court reviewed the proper approach to Section 57. The Court said that a Claimant should be found to be fundamentally dishonest if it was proved on the balance of probabilities that he had acted dishonestly either in relation to the primary claim and/or a related claim, and that he had substantially affected the presentation of his case, in a way which potentially adversely affected the Defendant in a significant way.

The Court cited the Supreme Court’s recent decision in Ivey v Genting Casinos UK which confirmed that “whilst dishonesty is a subjective state of mind, the standard by which the law determines whether that state of mind is dishonest is an objective one, and that if by ordinary standards a Defendant’s state of mind is dishonest, it is irrelevant that the Defendant judges by different standards”. If the judge was satisfied of this then he had to dismiss the claim, including any element of the primary claim in respect of which C had not been dishonest, unless, he was satisfied that C would suffer substantial injustice. “Substantial injustice” had to mean more than the mere fact that C would lose his damages for those heads of claim that were not tainted with dishonesty.

In the Sinfield case the High Court said that the first judge had been wrong to say that C had merely been muddled and careless. His schedule of loss contained dishonest misstatements and what he did was fundamentally dishonest. He presented a claim for a significant sum that was dishonest and evidenced it with false invoices and a dishonest witness statement. The dishonesty was premeditated and maintained over many months. This could have resulted in D paying out far more than it should.

This is an important decision in that it clarifies that Claimants cannot rely on ignorance or misunderstanding to escape a finding of dishonesty. Nor can a Claimant rely on the fact that he had a genuine injury to justify exaggerations to elements of his claim. It is hoped that this decision will act as a deterrent to those Claimants considering exaggerating a claim.

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