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New 'Fundamental Dishonesty' ruling on exaggerated claims

My Trusty Gavel by Brian Turner/steakpinball on Flickr

A recent case has revealed a new judgement on the Jackson reforms that is likely to lead to more defendants contesting cases from claimants who have suffered personal injury.

In Gosling v Screwfix and anor, a case heard by Cambridge County Court last month, the ruling judge found that the claimant had over-exaggerated his injuries following a fall from a ladder.

Since the Jackson reforms, the civil litigation measures enforced in April 2013 representing the biggest change to the civil litigation law since the 1990s, claimants are protected under ‘Qualified One-way Costs Shifting’ (QOCS) from having to pay defendant’s legal costs even when their claims are unsuccessful. However, the unfolding of the Gosling case revealed an exception if the claimant is deemed to have been ‘fundamentally dishonest’.

The defendant’s representatives, personal injury specialists at insurance law firm BLM, submitted the argument and revealed to the court that Gosling’s ongoing injuries were exaggerated, through the use of covert surveillance commissioned by the defendant’s insurer. Judge Maloney presided over the court during the case and ruled that Gosling pay Scewfix’s costs on an ‘indemnity basis’, that is without theoretical limitation, after the finding effectively reduced his claim by half.

Evidence of fundamental dishonesty reduced Gosling’s personal injury claim by half

Mr. Gosling received a blow to his knee on 31 July 2008 after falling through a rung on a ladder made by the first defendant and supplied to him by Screwfix. The claim was issued in December 2011 and scheduled for trial in December 2013; however, the defendant noticed inconsistencies in the claimant’s reported symptoms and through the use of covert surveillance, discovered an exaggeration of the injuries, later confirmed by medical experts.

The judge accepted the value of the circumstances that brought about the claim - that the claimant had received an injury following a fall from a ladder but due to the surveillance footage collected by the defendant, the value of the claim was reduced by half. Maloney found Gosling “fundamentally dishonest” and reasoned that dishonesty which is “incidental” or “collateral” to a claim is not fundamental, but would be, if it affects “the whole or substantial part of the claim”. In this instance, Maloney declared the dishonesty as worth about half the value of the claim and ruled it “on any view” as “fundamental”.

Gosling’s original injury when falling from the ladder in 2008 predates the QOCS and Jackson reforms. The case dates back to 2011, but Gosling appealed for QOCS protection only a few weeks before the hearing of the case in 2014, which forced the defendant to put forth an application for a discovery of fundamental dishonesty.

Freedom to contest Personal Injury claims is encouraging for insurers

Matthew Ford, partner at BLM, the firm which represented the defendant, stated that the new ruling will encourage insurers to contest claims that they are unsure about:

“It has been a concern that personal injury claimants – including those that exaggerate their claims – will be able to pursue cases with impunity, in the knowledge that they will not be liable to pay defendants’ legal costs even if they lose. This case will help defendants and their insurers to challenge the protection of QOCS, when a significant element of the claimant’s claim is exaggerated, and hopefully, recover their costs.”

The judge ruled that the over-exaggeration of the ongoing injuries was “deliberately dishonest”, designed to “deceive and give a false impression”.

The Jackson reforms were a shock to the civil justice system when Lord Justice Jackson promised to improve efficiency and decrease litigation costs. Just over a year on, these proceedings cast the reforms in a positive light, after controversy on their implementation in April 2013 due to firms fearing loss of business.

The story serves as a reminder and clear warning to victims of personal injury to pursue their claim with transparency. Ford added: “This judgment shows that it is not necessary for an entire claim to be fabricated – significant exaggeration is sufficient for a claim to be defined as dishonest”.

Have you been injured in an accident at work? Here at Fonseca & Partners we can provide you with expert advice and guidance regarding personal injury claims against an employer. If you would like to speak with one of our professional solicitors you can contact us on 01495 303124 or email enquiries@fonsecalaw.co.uk.