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Supreme Court refuses to strike out damages claim by man who lied about injuries

Contempt proceedings 'the most economical and the most just' way to deal with similar cases

27 June 2012

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Courts have the power to strike out personal injury claims for abuse of process but only in “very exceptional cases”, the Supreme Court ruled this morning.

The case involved the victim of a workplace accident who was found by the High Court to have lied to medical experts and the Department of Work and Pensions, until he was filmed by an undercover surveillance team driving and loading a van without difficulty.

The Supreme Court heard that Shaun Summers originally claimed damages of over £838,000, which he reduced to £250,000 after the surveillance evidence was disclosed.

The High Court found that there was no doubt that he had suffered serious fractures as a result of the accident, requiring at least two operations.

However, the judge also found that the evidence was “sufficiently cogent to sustain a claim of fraud”, not only applying the civil standard of being satisfied on the balance of probabilities but also on the criminal standard of being satisfied beyond reasonable doubt.

The High Court cut Summers’ claim to £88,700. Fairclough Homes appealed, arguing that the court should strike out the claim in its entirety.

Delivering the judgment of the court in Fairclough Homes v Summers [2012] UKSC 26, Lord Clarke said the justices recognised that there had been “many cases” where claimants dishonestly inflated their claims or even fraudulently invented them.

Overturning the Court of Appeal judgments in Ul-Haq v Shah and Widlake v BAA, he said courts did have the power to strike out claims even after trials where the court had been able to make an assessment of both liability and the amount of damages.

However, Lord Clarke said that, as a matter of principle, courts should only strike out claims in “very exceptional cases”.

He went on: “It was submitted that an ascertained claim for damages could only be removed by parliament and not by the courts.

“We are unable to accept that submission. It is for the court, not for parliament, to protect the court’s process. The power to strike out is not a power to punish but to protect the court’s process.”

Under article 6 of the ECHR, Lord Clarke said any limitation on the right of access to the courts must “pursue a legitimate aim and the means employed to achieve the aim must be proportionate”.

While it was in the public interest that the court should have a power to strike out claims for abuse of process, the court accepted that courts must “examine the circumstances of the case scrupulously” to ensure that striking out was proportionate.

Lord Clarke said the defendant had “indicated some reluctance” to launch contempt proceedings but he could see “no difficulty”, provided the relevant facts could be proved and that such an approach was likely to be the “both the most economical and the most just way to proceed”.

He said there was also the possibility of bringing criminal proceedings, and it was open to judges to refer cases to the CPS or the DPP.

“The test in every case must be what is just and proportionate. It seems to us that it will only be in the very exceptional case that it will be just and proportionate for the court to strike out an action after a trial.”

Concluding that Summers’ claim should not be struck out, Lord Clarke said: “We accept the submission that this is a serious case of abuse of process. The claimant persistently maintained his claim on a basis or bases which he knew to be false, both before he was found out and thereafter at the trial.

“Nevertheless, as a matter of substantive law, he had suffered significant injury as a result of the defendant’s breach of duty and, on those findings of fact, subject to the deductions referred to below was entitled to damages amounting to £88,716.76.”

Lord Clarke said an interim payment of £10,000 would have to be deducted, along with state benefits amounting to up to £63,000.

“Whatever the true figures turn out to be, it seems unlikely that the claimant will receive much, if anything, out of the award of £88,716.76.”

Lords Kerr, Hope, Dyson and Reed contributed to the judgment.

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Procedures Health & Safety