Fraudulent Claims: The Difference North And South Of The Border

All too commonly courts hear cases in which the claimant alleges, through exaggeration or lies, that they suffered severe injuries as a result of a harmless accident. But legislating to prevent dishonest claims such as these is fraught with difficulty because there is a risk that borderline, yet meritorious, cases will be discouraged from appearing in the courtrooms. The Scottish legal system has diverged from the English and Welsh system in trying to tackle the difficult issues presented by fraudulent claims. Two recent cases, one North and one South of the border put the consequences of those different approaches into sharp focus.

Fraud in personal injury claims can range from mild exaggeration to flat-out falsehood. The court has the difficult task of deciding where to draw the line. In England, the treatment of fraudulent cases is set out in statute, in Scotland the Courts are bound to interpret and apply the common law.

The position in England

In England and Wales, Section 57 of the Criminal Justice and Courts Act 2015 requires the court to dismiss, in its entirety, any claim in which the claimant is held to have acted with 'fundamental dishonesty'. The operation of this provision was seen in full effect in the case of Pinkus v Direct Line [2018] EWHC 1671 (QB), handed down in July 2018. In Pinkus, the claimant's presentation was found to be exaggerated and dishonest and although the judge found in favour of the claimant, to a limited extent, for pain, suffering and loss of amenity; the Judge dismissed the entire claim at the end of proceedings on the basis that the claimant had been 'fundamentally dishonest'.

In deciding what constituted fundamental dishonesty, the judge approved the Sinfield test, as set out in LOCOG v Sinfield [2018] EWHC 51 (QB) In terms of that test, fundamental dishonesty is established if the claimant's dishonesty "substantially affected the presentation of his case... in a way which potentially adversely affected the defendant in a significant way." In Sinfield the claimant had fabricated a claim for gardening costs. Other elements of his claim were accepted as genuine.

Pinkus made a considerable claim against the defender, largely in relation to loss of earnings. Pinkus tried to establish his claims through - in the opinion of the judge - massively exaggerated courtroom performances, dishonest testimony to doctors, and numerous lies in peripheral matters. Combining these factors, the judge held that Pinkus had...