Our Expertise

Lorem ipsum dolor sit amet, consectetur adipisicing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam, quis nostrud exercitation ullamco laboris nisi ut aliquip ex ea commodo consequat.

Allegation of Fundamental Dishonesty? No Interim Payment Permitted.

<!-- wp:paragraph --> <p><strong>Qaiser Mehmood (by LF Asma Islam) v Harry Mayor [2024] EWHC 1057 (KB)</strong></p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p>Decision of Master Fontaine (SIR)</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p>8 May 2024</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><a href="https://www.bailii.org/cgi-bin/format.cgi?doc=/ew/cases/EWHC/KB/2024/1057.html&amp;query=(Mehmood)+AND+((by)+AND+(his)+AND+(litigation)+AND+(friend)+AND+(Mrs)+AND+(Asma)+AND+(Islam))+AND+(v)+AND+(Mayor)">https://www.bailii.org/cgi-bin/format.cgi?doc=/ew/cases/EWHC/KB/2024/1057.html&amp;query=(Mehmood)+AND+((by)+AND+(his)+AND+(litigation)+AND+(friend)+AND+(Mrs)+AND+(Asma)+AND+(Islam))+AND+(v)+AND+(Mayor)</a></p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><span style="text-decoration: underline;">Introduction</span></p> <!-- /wp:paragraph --> <!-- wp:list --> <ul><!-- wp:list-item --> <li>In this case, the claimant brought a claim for serious injuries arising from a RTA in January 2019. As a consequence, the claimant suffered severe brain injury which he alleged caused a lack of capacity.</li> <!-- /wp:list-item --></ul> <!-- /wp:list --> <!-- wp:list --> <ul><!-- wp:list-item --> <li>The defendant admitted primary liability, but alleged contributory negligence and disputed the extent of the claimant’s alleged injuries. </li> <!-- /wp:list-item --></ul> <!-- /wp:list --> <!-- wp:list --> <ul><!-- wp:list-item --> <li>The defendant disputed the issue of capacity, and this was to be determined at trial.</li> <!-- /wp:list-item --></ul> <!-- /wp:list --> <!-- wp:list --> <ul><!-- wp:list-item --> <li>Further, relying on medical and surveillance evidence and by an Amended Defence, the defendant alleged the Claimant was fundamentally dishonest and that the claim should be dismissed under s57 Criminal Justice and Courts Act 2015.</li> <!-- /wp:list-item --></ul> <!-- /wp:list --> <!-- wp:list --> <ul><!-- wp:list-item --> <li>The claimant sought retrospective approval of an interim payment of £10,000 made in August 2019 and applied for a further interim payment of £75,000.  The further payment was to be used to fund rehabilitation recommended by the experts instructed by the claimant and defendant.</li> <!-- /wp:list-item --></ul> <!-- /wp:list --> <!-- wp:list --> <ul><!-- wp:list-item --> <li>The application was refused.   Even though primary liability had been admitted, the defendant’s allegation of fundamental dishonesty meant that the threshold criteria contained in CPR 25.7(1)(a) and CPR 25.7(1)(c) had not been met.</li> <!-- /wp:list-item --></ul> <!-- /wp:list --> <!-- wp:paragraph --> <p><span style="text-decoration: underline;">Law</span></p> <!-- /wp:paragraph --> <!-- wp:list --> <ul><!-- wp:list-item --> <li>CPR 57 provides:<br><br>25.7(1) The court may only make an order for an interim payment where any of the following conditions are satisfied—<br><br>(a) the defendant against whom the order is sought has admitted liability to pay damages or some other sum of money to the claimant;<br><br>(b) the claimant has obtained judgment against that defendant for damages to be assessed or for a sum of money (other than costs) to be assessed;<br><br>(c) it is satisfied that, if the claim went to trial, the claimant would obtain judgment for a substantial amount of money (other than costs) against the defendant from whom he is seeking an order for an interim payment whether or not that defendant is the only defendant or one of a number of defendants to the claim…<br><br>(4) The court must not order an interim payment of more than a reasonable proportion of the likely amount of the final judgment.<br><br>(5) The court must take into account—<br><br>(a) contributory negligence; and<br><br>(b) any relevant set-off or counterclaim.<br><br></li> <!-- /wp:list-item --> <!-- wp:list-item --> <li>S57 of the Act provides:<br><br>(1) This section applies where, in proceedings on a claim for damages in respect of personal injury (“the primary claim”)—<br><br>(a) the court finds that the claimant is entitled to damages in respect of the claim, but<br><br>(b) on an application by the defendant for the dismissal of the claim under this section, the court is satisfied on the balance of probabilities that the claimant has been fundamentally dishonest in relation to the primary claim or a related claim.<br><br>(2) The court must dismiss the primary claim, unless it is satisfied that the claimant would suffer substantial injustice if the claim were dismissed.<br><br>(3) The duty under subsection (2) includes the dismissal of any element of the primary claim in respect of which the claimant has not been dishonest.</li> <!-- /wp:list-item --></ul> <!-- /wp:list --> <!-- wp:paragraph --> <p><span style="text-decoration: underline;">The claim</span></p> <!-- /wp:paragraph --> <!-- wp:list --> <ul><!-- wp:list-item --> <li>The Judge reviewed and summarised the evidence of the medical experts instructed by the claimant and the defendant; and in particular identified the experts’ evidence relevant to the allegation of fundamental dishonesty.</li> <!-- /wp:list-item --></ul> <!-- /wp:list --> <!-- wp:list --> <ul><!-- wp:list-item --> <li>At paragraph 25 she stated:<br><br>‘The issue as to whether the Claimant is exaggerating the effect of his injuries, and if so, whether he is being fundamentally dishonest in so doing, can only be resolved at trial when the oral evidence of the medical experts and of the witnesses of fact is heard. That is not an issue that can be resolved on a summary basis with only documentary evidence.’<br><br></li> <!-- /wp:list-item --> <!-- wp:list-item --> <li>She continued at paragraph 26:<br><br>‘Even if the trial judge considers that the conditions of s. 57(1) are satisfied, they will have different options as to what the consequence of such finding should be. It may be dismissal of the primary claim, but if the court finds that the Claimant would thereby suffer substantial injustice that is not obligatory. If the court found that there had not been substantial dishonesty, but, for example, found there had been exaggeration of the Claimant’s symptoms and/or the effects of the injuries suffered which were not fundamentally dishonest, the damages claimed may be reduced to a greater or lesser degree depending upon the judge’s findings. Alternatively, the judge may consider that there is no merit to the application for a finding of fundamental dishonesty and that the submissions made on the Claimant’s behalf as to his inability to carry out the work he previously did are correct. But this is not a case similar to the position in <em>Salwin</em>, and indeed in many applications for interim payments in personal injury claims. The range of what the Claimant may expect to recover is from nothing to the full amount he is seeking. There is no “irreducible minimum” as referred to in <em>Chiron Corporation &amp; ors v Murex Diagnostics Limited (No 13) </em>[1996] FSR 578 and <em>Trebor Bassett Holdings limited v ADT Fire &amp; Security plc </em>[2012] EWHC 3365 (TCC) per Coulson J. at [13]. Thus, it is not possible for the court to conclude, in accordance with CPR 25.7(4), what would be “<em>a reasonable proportion of the likely amount of the final judgment</em>”.<br><br></li> <!-- /wp:list-item --> <!-- wp:list-item --> <li>The Judge rejected the application; at paragraph 27 she stated:<br><br>‘In any event, the Defendant is correct that the requirements of CPR 25.7(1)(a) are not satisfied in this claim, namely that “<em>the Defendant against whom the order is sought has admitted liability to pay damages or some other sum of money to the Claimant.</em>” By virtue of the plea of fundamental dishonesty the Defendant has denied liability to “<em>pay damages</em>” to the Claimant, and at paragraph 29 of the Amended Defence seeks dismissal of the claim under either s. 57 or under the jurisdiction outlined in <em>Summers v Fairclough </em>[2012] UKSC 26. That is the short answer to the application.’<br><br></li> <!-- /wp:list-item --> <!-- wp:list-item --> <li>The Judge also rejected the claimant’s submission that the court also had power to make an order under CPR 27(1)(c) and stated at paragraph 29:<br><br>‘Exactly the same considerations apply in respect of CPR 25.7(1) (c) as apply to CPR 25.7(1) (a). For the reasons given, the court cannot be so satisfied.’<br><br></li> <!-- /wp:list-item --> <!-- wp:list-item --> <li>The Judge acknowledged that the refusal to make an interim payment may cause injustice to the claimant should the defendant’s allegation of fundamental dishonesty be rejected as he would not have received the funds needed for the recommended rehabilitation.   However, the requirements for an interim payment were not met and the Judge was bound to refuse the application.</li> <!-- /wp:list-item --></ul> <!-- /wp:list --> <!-- wp:paragraph --> <p><span style="text-decoration: underline;">Takeaway</span></p> <!-- /wp:paragraph --> <!-- wp:list --> <ul><!-- wp:list-item --> <li>The Judge’s refusal to allow the application was not dependent upon an assessment of the evidential value of the medical evidence or surveillance evidence.  An allegation of fundamental dishonesty (which as here had been pleaded and was supported by evidence) was without more an absolute bar to an interim award of damages.</li> <!-- /wp:list-item --></ul> <!-- /wp:list --> <!-- wp:list --> <ul><!-- wp:list-item --> <li>A bare allegation of fundamental dishonesty (especially if not pleaded) will not by itself prevent a court making an interim award. Even though there is a wealth of authority which permits a defendant to raise fundamental dishonesty at trial even when not pleaded (providing the claimant has been given adequate warning and a proper opportunity to meet the allegation per paragraph 31 of Howlett v Davies [2017] EWCA Civ 1696), this case is a salutary reminder for defendants that in many cases it essential for the allegation to be pleaded  fully and properly.</li> <!-- /wp:list-item --></ul> <!-- /wp:list --> <!-- wp:list --> <ul><!-- wp:list-item --> <li>If the interim payment has already been made before the allegation of fundamental dishonesty is pleaded, an application for repayment of the interim payment is likely to be permitted under CPR 25.8 if fundamental dishonesty is proven.</li> <!-- /wp:list-item --></ul> <!-- /wp:list --> <!-- wp:list --> <ul><!-- wp:list-item --> <li>The court has power to retrospectively validate any step taken in proceedings under CPR 21.3(4).  Here, the Judge refused to do so for the same reasons she rejected the application for a further interim payment.</li> <!-- /wp:list-item --></ul> <!-- /wp:list --> <!-- wp:paragraph --> <p><a href="https://parklaneplowden.co.uk/Corin_Furness">Corin Furness</a> is a member of the PLP Serious Injuries Team and Head of the Civil Fraud &amp; Credit Hire Team.</p> <!-- /wp:paragraph -->

Nicola Twine reflects on securing a finding of Fundamental Dishonesty with Enforceable Costs

<!-- wp:paragraph --> <p><strong><mark style="background-color:rgba(0, 0, 0, 0)" class="has-inline-color has-luminous-vivid-orange-color">“</mark></strong> What appears at first blush to be a straightforward case often is not. Many personal injury claims arise from ‘rear end shunt no fault accidents’, and damages are often expected to be recovered where that accident was sufficient to cause injury.<br><br>Withholding of information and misleading provision of information can have serious consequences.<br><br>Last week, in a case instructed by <a href="https://dwfgroup.com/en/services/legal-services/insurance/motor">DWF</a> for <a href="https://www.aviva.co.uk/">Aviva</a>,  I was successful in having a claim dismissed and securing a finding of ‘fundamental dishonesty’.<br><br>The Claimant had been involved in two accidents in proximity and brought claims arising from both. DWF had obtained the medical reports in both cases and social media posts, which were able to be considered alongside her medical records. </p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p>The Claimant had been selective in what she had disclosed to medical experts, in relation to: each accident, her injuries, and her medical history. On the special damages claim there were suspicions of ‘claims layering’ - that the CBT and physiotherapy treatment had been added with the specific purpose of increasing the value of the claim and costs.<br><br>As the Defendant did not call evidence the case was determined following robust cross examination and submissions on credibility. The Claimant's reasons for her apparent failures were many. She was a poor historian unable to explain the inconsistencies and oddities. What is outlined as expected of a genuine claimant in 'Molodi' was not present. The trial Judge did not make finding of 'claims layering' but expressed concern about the medical reports in the case. Whilst it appeared that the Claimant may have been caught up in a model operated by others the Judge found that the Claimant was dishonest. In this case there was more than exaggeration at play, although exaggeration alone can give rise to a finding of fundamental dishonesty.<br><br>Fundamental dishonesty was found with enforceable costs and the Claimant was ordered to repay an interim payment.<br><br>Thanks to <a href="https://www.linkedin.com/in/ACoAAD7cNOYBLe-BDqnjeo_BlCJOGtKN6Re40to">Rohini Kapur</a> for her instructions and assistance. <strong><mark style="background-color:rgba(0, 0, 0, 0)" class="has-inline-color has-luminous-vivid-orange-color">”</mark></strong></p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p></p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><em>Nicola Twine is a member of the specialist Personal Injury, Clinical Negligence, and Employment Teams at Parklane Plowden Chambers and is ranked as a Leading Junior by Chambers &amp; Partners and The Legal 500 in Employment and by The Legal 500 in Clinical Negligence. Her full profile can be accessed <a href="https://www.parklaneplowden.co.uk/barristers/nicola-twine">here</a>.</em></p> <!-- /wp:paragraph -->

A Sigh of Relief? Court of Appeal Confirms that Denton Principles Apply to Applications to Set Aside Default Judgment

<!-- wp:paragraph --> <p>In <em>FXF v English Karate Federation &amp; Anor</em> [2023] EWCA Civ 891, the Court of Appeal confirmed beyond doubt that the <em>Denton </em>principles must be taken into account when considering an application to set aside judgment.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>The Claim</strong></p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p>The Claimant brought proceedings in relation to alleged sexual abuse by a karate instructor. The Second Defendant, Ishinryu Karate Association (“IKA”), failed to file its defence in time. The Claimant obtained default judgment, pursuant to CPR 12.4.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p>IKA applied to set aside the judgment, pursuant to CPR 13.3. A Master allowed the application. The Claimant appealed on the basis that the Master had failed to “apply <em>Denton </em>to the exercise of his discretion.” The Claimant contended that had the Master applied <em>Denton </em>then he would not have set the judgment aside.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>The Court of Appeal’s Decision</strong></p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p>The Court of Appeal held that the Master <em>had </em>applied the <em>Denton </em>criteria, although he had not made this explicitly clear in his judgment, noting that:</p> <!-- /wp:paragraph --> <!-- wp:paragraph {"style":{"typography":{"fontStyle":"italic","fontWeight":"400"}}} --> <p style="font-style:italic;font-weight:400">4. The Master set aside the Judgment dealing specifically with the two factors mentioned in CPR Part 13.3, namely the merits and delay in applying to set aside. He held that (i) the IKA had a real prospect of successfully defending the claimant's case on vicarious liability: the defence was "arguable and sophisticated", and (ii) the application to set aside had not been made promptly and there was no good reason for the delay. In relation to <em>Denton</em>, he said in his judgment: </p> <!-- /wp:paragraph --> <!-- wp:paragraph {"style":{"typography":{"fontStyle":"italic","fontWeight":"400"}}} --> <p style="font-style:italic;font-weight:400">However, I turn to the express primary requirements of 13.3(1). Mr Tahzib [counsel for the claimant] refers appropriately to&nbsp;<em>Denton</em>&nbsp;and its criteria. But the familiar criteria of&nbsp;<em>Denton</em>&nbsp;are qualified because of necessary incorporation into the context and the express criteria under CPR 13.3: in particular, the criterion of "real prospect of successfully defending the claim".</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p>In addition, the Court of Appeal agreed with the Master’s decision that it was appropriate that judgment should be set aside.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>General Application of the Judgment</strong></p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p>Importantly, the Court of Appeal confirmed unequivocally that the <em>Denton </em>criteria do apply to applications to set aside judgment pursuant to CPR 13.3.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p>Sir Geoffrey Vos MR, giving the leading judgment, stated:</p> <!-- /wp:paragraph --> <!-- wp:paragraph {"style":{"typography":{"fontStyle":"italic","fontWeight":"400"}}} --> <p style="font-style:italic;font-weight:400">72. For the reasons I have given, this court is now clearly stating that the&nbsp;<em>Denton</em>&nbsp;tests apply in their full rigour to applications to set aside default judgments.&nbsp;<em>PXC&nbsp;</em>is overruled and the&nbsp;<em>dicta&nbsp;</em>in&nbsp;<em>Cunico</em>&nbsp;are no longer to be relied upon.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Comment</strong></p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p>Although the Court of Appeal came down firmly in favour of applying <em>Denton </em>(and, indeed, held that this was made clear by the existing authorities), it seems fair to say that the position has <em>not </em>always been clear to practitioners.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p>While it may, on one view, have made sense to apply the <em>Denton </em>criteria, it would not have been obviously foolish to take the view that only the criteria set out at CPR 13.3 (which are different from the <em>Denton </em>criteria) should apply.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p>The White Book commentary accompanying CPR 13.3 (specifically 13.3.5) does not make clear that <em>Denton </em>should be applied, instead setting out the competing contentions as to its relevance.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p>The clarity now provided by the Court of Appeal is welcome.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p>A link to the full judgment on Bailli can be found <a href="https://www.bailii.org/cgi-bin/format.cgi?doc=/ew/cases/EWCA/Civ/2023/891.html&amp;query=(Fxf)+AND+(karate)">here</a>.</p> <!-- /wp:paragraph -->

Giving Notice – Fundamental to Alleging Dishonesty?

<!-- wp:paragraph --> <p><strong>Written by <a href="https://www.parklaneplowden.co.uk/our-barristers/sophie-watson/" target="_blank" rel="noreferrer noopener">Sophie Watson</a></strong></p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p>In the High Court case of <em>Jenkinson v Robertson </em>[2022] EWHC 791 Mr Justice Choudhury overturned a finding of fundamental dishonesty. This case highlights the need to give a Claimant adequate notice of allegations of fundamental dishonesty and provide them with sufficient time to properly respond.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Background</strong></p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p>By way of the background, the Claimant sustained injuries in a road traffic collision. The first instance judge found that the Claimant was dishonest in that he exaggerated his symptoms of a back injury. &nbsp;</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p>The Claimant was given permission to appeal on 3 grounds:</p> <!-- /wp:paragraph --> <!-- wp:list {"ordered":true,"type":"1"} --> <ol type="1"><li>Procedural fairness: The Claimant had not been given sufficient notice/opportunity to respond to allegations of fundamental dishonesty.<br></li><li>The Judge had wrongly reversed the burden of proof, requiring the Claimant to prove that he was not fundamentally dishonest.<br></li><li>The Judge was led into error, or was wrong, in relation to each of the factors upon which he based his decision that the Claimant was fundamentally dishonest.</li></ol> <!-- /wp:list --> <!-- wp:paragraph --> <p><strong>Judgement</strong></p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p>In respect of the first ground, the Defendant relied upon correspondence which asserted that the claim was ‘<em>exaggerated and unreasonable’ </em>as evidence of putting the Claimant on notice<em>.</em></p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p>However, Mr Justice Choudhury rejected that this was sufficient to equate to allegations of fundamental dishonesty and may be misconceived. He found any doubt as to the allegations could have been cleared up by pleading with specificity.<em></em></p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p>The Defendant also sought to argue, in further correspondence, that they had stated that they did not consider the Claimant’s losses to be reasonable or credible. However, Mr Justice Choudhury found that ‘<em>an allegation that a claim was not credible could amount to notice of an allegation of dishonesty; but without more… it did not unequivocally amount to such an allegation’</em>.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p>The Court also noted that the Defendant refused to provide particulars on grounds which its s.57 Criminal Justice and Courts Act 2015 (‘s.57’) application was made, even though requested to do so. Mr Justice Choudhury found that this was not a satisfactory way to pursue an allegation of fundamental dishonesty.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p>It was ultimately found that the Claimant was not given any real notice apart from a ‘<em>vague and deliberately unparticularised allusion to the possibility of a s.57 application’. </em>This had led to key documents and information failing to be placed before the Court.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p>Mr Justice Choudhury stated that in the interests of fairness the Claimant should have been given adequate warning of and proper opportunity to deal with fundamental dishonesty given the severe consequences.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p>The appeal for procedural fairness was allowed.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p>Briefly, ground 2 was dismissed on the basis that there was no real reference in the first instance judgement of the burden of proof. It therefore could not be said that the burden had been reversed.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p>Finally, on ground 3, it was upheld that there were substantial errors in all 3 matters which the first instance judge found fundamental dishonesty.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Comment</strong></p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p>As acknowledged in the judgement, the Defendant is not precluded from running a s.57 defence if the same is not pleaded. However, this is another case which warns against the possibility of failing to put the Claimant on proper notice of allegations of fundamental dishonesty. Without adequate notice and sufficient time for the Claimant to respond there is a real possibility that the Court could reject allegations of fundamental dishonesty. &nbsp;</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p>The full judgement can be accessed at <a href="https://www.bailii.org/cgi-bin/format.cgi?doc=/ew/cases/EWHC/QB/2022/791.html&amp;query=(jenkinson)+AND+(v)+AND+(robertson)" target="_blank" rel="noreferrer noopener">www.bailii.org - <em>Jenkinson v Robertson</em> (Rev1) [2022] EWHC 791</a></p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><strong>Author </strong></p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p><a href="https://www.parklaneplowden.co.uk/our-barristers/sophie-watson/" target="_blank" rel="noreferrer noopener">Sophie Watson</a>&nbsp;is a pupil barrister currently undertaking a pupillage with Parklane Plowden Chambers.</p> <!-- /wp:paragraph --> <!-- wp:paragraph --> <p>Sophie is now accepting instructions.</p> <!-- /wp:paragraph -->