PI Claimant Lawyers: Spotting Fraud and Fundamental Dishonesty

Fraud and fundamental dishonesty are big topics, and claimant lawyers need to be hot on spotting such issues. We were reminded of this during training with James Henry, Counsel, of Temple Garden Chambers. As a claimant firm we are fully committed to stamping out fraud and fundamental dishonesty. All our staff are now trained to identify and deal with such claims.

The key is to get into the mind-set of the defendant.

Ensure that your client, or the Litigation Friend as the case may be, is asked whether any previous claims have been made. It is of note that insurers can and do share information related to crime (as permitted by section 29 of the Data Protection Act 1998) and so it is most likely they will be aware of fraudulent claims. It may be that a defendant also asks for disclosure of any relevant criminal offences committed by your client.

Furthermore, defendants are very likely to search for your client’s social media accounts (statuses, comments, photos, likes, hobbies etc.), YouTube and/or press releases to try and build their case. Such a search could even reveal links with other Parties and/or witnesses. As a result, it is essential that you carry out such searches.

In relation to road traffic accidents, be alert to the following:

  • “Slam on” collisions, which often take place on slip roads and roundabouts.
  • Multi-occupancy vehicles where there could be scope for bogus passengers.
  • Staged or contrived accidents (which can also occur in slip/trip cases).
  • How long after the accident a claim is being pursued.

In any claim, look out for inconsistencies in evidence.

The key provisions in relation to fundamental dishonesty, specifically, are section 57 of the Criminal Justice & Courts Act 2015 and CPR rule 44.16. Note that the former does not apply to proceedings started by the issue of a claim form before the day on which this section came into force, namely 13th April 2015.

In essence, section 57 provides that if an otherwise successful claimant is found, on the balance of probabilities, to have been fundamentally dishonest in relation to their claim or a related claim,[1] the claimant’s claim must be dismissed. That is unless the Court is of the view that the Claimant would suffer substantial injustice. Such an exception is likely to have more force in a case where catastrophic injuries are concerned. Remember though that before the defendant can make such an application liability needs to be admitted or proven as the section only applies where the claimant is entitled to damages.

CPR r.44.16 provides exceptions to qualified one-way costs shifting where permission is required. Under r.44.16(1) orders for costs made against the claimant may be enforced to the full extent of such orders with the permission of the court where the claim is found on the balance of probabilities to be fundamentally dishonest.

The 2015 Act refers to the claimant being found fundamentally dishonest as opposed to the claim as in the CPR.

Determining what is fundamental dishonesty is no simple task. However, asking oneself whether the dishonesty goes to the heart/core/foundation of the claim is usually a good place to start.

Comparing the value of the head of loss to the total claimed can be useful in some cases, but not all. Be aware of this trap since while the value may only be a small percentage of the total it may still go to the heart of the claim.

Of course there are other remedies that may be sought by a defendant, including:

  • Contempt of court;
  • Exemplary damages;
  • Tort of deceit.

Despite the above, of course the vast the majority of claimants are entirely honest. Even where exaggeration is concerned there is a real distinction as to whether it is conscious or unconscious. Some possess a genuine mistaken belief in relation to their injury, for instance.

The key is to remember not to breach client confidentiality unless necessary, and to not mislead the Court (with whom your overriding duty lies) or your opponent. As a result, you must come off record where fraud or fundamental dishonesty are suspected. This is likely to be an indication to the defendant that the claimant/claim is not all that they/it seemed initially. Of course this may not be the end of the matter as the defendant can still, for instance, pursue a finding of fundamental dishonesty. Nevertheless, it sends a clear message to dishonest claimants that their lies will not be tolerated and that we are unwilling to represent them as a result.

 

Miss Henrietta Hughes

In House Counsel

Hilary Meredith Solicitors Ltd