Kerry Underwood

PERSONAL INJURY: QOCS AND FUNDAMENTAL DISHONESTY: NEW HIGH COURT CASE

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These principles, and the whole issue of Qualified One-Way Costs Shifting, is dealt with in my book – Qualified One-Way Costs Shifting, Section 57 and Set-Off – Available from me here for £15.

The matters dealt with in this piece are examined in great detail in my three volume, 1,300 page book Personal Injury Small Claims, Portals and Fixed Costs – price £50 and available from Underwoods Solicitors here.

Kerry Underwood offers consultancy services in relation to this and other matters and details are here.

In

Pegg v Webb & Anor [2020] EWHC 2095 (QB)

the Queen’s Bench Division of the High Court, on appeal, overturned the trial judge’s finding that the claimant had not been fundamentally dishonest and substituted its own decision that the claimant had been fundamentally dishonest, and therefore lost Qualified One-way Costs Shifting protection and had to pay the costs of the defendant.

This was a road traffic accident for which the defendant driver was wholly liable, although the insurance company for the defendant had argued that there had been no accident, or if there had been, then it had been contrived by the parties.

The trial judge rejected that argument, but nevertheless dismissed the claim on the basis that the claimant had not shown that the accident had caused the injuries complained of, or indeed any injury at all.

Thus, it was a strange decision in that the judge accepted the claimant’s evidence that there had been an accident but rejected the claimant’s evidence as to injuries suffered and actually dismissed the claim, rather than just awarding modest damages and/or punishing the claimant in costs.

On appeal, the High Court said:

“…no judge could reasonably have failed to have come to the conclusion that the claim for damages as presented by the Claimant in this action was a fundamentally dishonest one, perpetrated by fundamentally dishonest accounts to the only medical expert and in the various court documents.”

In spite of dismissing the claim the trial judge had ordered the successful defendant to pay 60% of the claimant’s costs on the basis that the defendant’s allegation of fundamental dishonesty against the claimant meant that what would have been a one day fast-track claim became a two day multi-track claim.

There was no appeal against the finding that there had been no accident, or that if there had been an accident it had been staged between the parties.

Thus, the appeal turned on the dishonest evidence given by the claimant  to the medical expert.

The trial judge found that the claimant had failed to give the expert relevant information and that what he told the expert about the longevity of his injuries was inconsistent with his own evidence at trial.

Consequently, the trial judge said that no reliance could be placed on the medical report and, without that report the claim had to fail.

That a bit self is a somewhat curious finding as clearly a person could give evidence about their own injuries.

A month after the accident the claimant was involved in another accident, arising from his use of a quad bike and he attended the emergency department at hospital, but made no mention of the road traffic accident, and his alleged injuries, to the doctor at the hospital.

The expert spent just 10 minutes with the claimant.

He did not mention the second accident to the expert, and lied about various matters.

The trial judge said:

“I accept that, on the balance of probabilities, Mr Pegg knew that it was relevant to tell Mr Shakir about the quad bike accident but he did not do so.”

On appeal, the High Court found that that must have involved the trial judge finding that the failure by the claimant to tell the expert about the quad bike accident was dishonest.

Although each case will depend upon its facts, the court here reviewed the case law in relation to findings of fundamental dishonesty in the context of QOCS.

Here the High Court found that the dishonesty about the injuries was fundamental as that was the whole point of the claim and the evidence, as liability had been admitted.

It was “the very basis of the claim.”

The court adopted the common law test for dishonesty as recently restated by the Supreme Court in

Ivey v Genting Casinos Limited [2018] AC 391,

where the court said:

“When dishonesty is in question the fact-finding tribunal must first ascertain (subjectively) the actual state of the individual’s knowledge or belief as to the facts. The reasonableness or otherwise of his belief is a matter of evidence (often in practice determinative) going to whether he held the belief, but it is not an additional requirement that his belief must be reasonable; the question is whether it is genuinely held. When once his actual state of mind as to knowledge or belief as to facts is established, the question whether his conduct was honest or dishonest is to be determined by the fact-finder by applying the (objective) standards of ordinary decent people. There is no requirement that the defendant must appreciate that what he has done is, by those standards, dishonest.”

The High Court here also examined the scope of an appellate court in relation to findings of fact by the trial judge and reminded itself that there is a distinction between the finding of a specific fact and the finding of facts which were really an inference drawn from the facts specifically found.

In the case of so called inferred facts, an appellate tribunal will more readily form an independent opinion than in the case of specific facts which involve the evaluation of the evidence of witnesses.

The High Court allowed the appeal and ordered that the order dismissing the claimant’s claim be endorsed with a finding of fundamental dishonesty on the part of the claimant in relation to the claim for damages.

In relation to costs, the judge substituted an order that the claimant pay 70% of the defendant’s costs, to be assessed on the indemnity basis, and due to the finding of fundamental dishonesty the defendant can enforce the full order in accordance with CPR 44.16(1) which provides:

“(1) Orders for costs made against a claimant may be enforced to the full extent for such orders with the permission of the court where the claim is found, on the balance of probabilities, to be fundamentally dishonest.”

The reason that the court only ordered 70% of the defendant’s costs to be paid was that it had failed in its allegation against the claimant that the claim was bogus either because there had been no collision or there had been collusion between the parties.

Written by kerryunderwood

August 4, 2020 at 2:00 pm

Posted in Uncategorized

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