At the deep end

There are certain procedural issues which need to be considered when bringing proceedings for contempt of court. Jurisdiction and the importance of clearly drafted particulars are not least among these.

The recent decision of Coulson J in Kirk v Walton [2009] EWHC 703 (QB) could pave the way for an increase in contempt of court proceedings, particularly as a weapon for insurers to try and reduce the rising number of false personal injury claims.

As a result of a road traffic accident between Mrs Kirk and Mrs Walton in 2001, proceedings for damages were commenced by Mrs Kirk in the county court. Video surveillance (obtained by Mrs Walton's insurers) allegedly showed Mrs Kirk to be suffering no disabilities. Mrs Kirk agreed to settle the case before trial after the disclosure of the surveillance evidence.

Following settlement, Mrs Walton's solicitors were given permission to commence contempt of court proceedings against Mrs Kirk. Permission was given under CPR 32.14, which allows proceedings to be brought if a false statement is made in a document verified by a statement of truth without belief that the facts stated in it are true.

Determining jurisdiction

In Kirk both counsel agreed immediately prior to trial that the case could be heard in the High Court (by the allocated trial judge Mr Justice Coulson), notwithstanding that a potential procedural irregularity had been identified.

Paragraph 28.1(1) of the practice direction to CPR 32 suggests that an allegation that a statement of truth is false should be referred to the court dealing with the claim in which the statement of truth has been made; in this case the county court. The practice direction, however, also cross refers to the practice direction to RSC Order 52 which states that the committal application may be made to the county court in question if the alleged contempt 'consists of an act done in the course of proceedings in a county court' (thus also permitting the application to be made in an appropriate superior court).

RSC Order 52.1(2) states that 'where contempt of court... is committed in connection with ... proceedings in an inferior court '¦ then an order of committal may be made only by a Divisional Court of the Queen's Bench Division'.

Despite the apparent conflict between the various procedural rules, both parties agreed that the Divisional Court had jurisdiction to try the matter. However, the proceedings had been commenced in the QBD, and Coulson J was concerned to ensure he had jurisdiction to hear the matter. He would undoubtedly have had jurisdiction to hear the matter had the alleged contempt occurred in High Court proceedings (as set out in RSC Order 52, Rule 1(3)), but curiously not in county court proceedings.

It is worth noting that PD RSC Order 52, para.10 does state that 'the court may waive any procedural defect in the commencement or conduct of a committal application if satisfied that no injustice has been caused to the respondent by the defect'. This raises the interesting point of whether a judge at a later hearing is empowered by this provision to give himself the jurisdiction to waive the procedural defect if the court who granted

permission for the proceedings had no jurisdiction to give permission in the firstinstance.

Coulson J concluded on the issue of jurisdiction that despite the 'opaque nature' of RSC 52.1, CPR 32.14 does provide a High Court judge with the necessary jurisdiction to deal with a committal for contempt of court arising out of documents verified in the county court by way of a statement of truth.

It was also argued at trial by the applicant that in addition to the many allegations of contempt set out in the particulars (of which only two were eventually proved) there were three further instances of contempt of court even though they were not set out in the particulars. Coulson J's decision emphasised the importance of ensuring that all allegations are properly pleaded and would only hear those that were pleaded.

What about Shah?

This brings us onto the more recent case, Shah v Ul-Haq and others [2009] EWCA Civ 542. All three respondents in this case had brought claims against the appellant, Mrs Shah, for personal injuries allegedly sustained in a road traffic accident when the car in which they claimed to have been travelling in had collided with hers. Mrs Shah admitted liability for the collision but alleged that the second respondent was not in the car at the time and therefore the first and third respondents' cases should be struck out as an abuse of process due to their part in the attempted fraud.

At first instance, the judge found that the second respondent had not been in the car and that the first and third respondents had conspired to bring a false claim but declined to strike out their claims. The court penalised the respondents on costs with the result that the total costs payable to Mrs Shah exceeded the damages awarded to the first and third respondents. Mrs Shah appealed against the decision that it was not appropriate to strike out.

The appeal was made on the basis that the first and third respondents should have been struck out at first instance as a result of the fraud. The Court of Appeal dismissed the appeal, stating that:

• a claimant would not be deprived of damages to which he was entitled because he had fraudulently attempted to obtain more;
• on the facts there was no suggestion that the fraud had led to an unfair trial;
• in certain cases the power to strike out could be deployed where it became apparent at trial that a fair trial could not be heard or that a claim could not succeed without the corrupt evidence; and
• a court can deal with the fraud by way of imposing costs penalties.

Given the decision in Kirk earlier this year, the question arises whether proceedings could have been brought for contempt of court (pursuant to CPR 32.14) against all the respondents. It could be suggested that such an option was open to the appellant because the court in Kirk made it clear that personal injury claimants can be held in contempt of court for exaggerating a claim as well as in situations where claims have been totally false.

Estoppel

However, prior to pursuing contempt of court in these circumstances it would be sensible also to consider the issue of estoppel given that the Court of Appeal had made a final determination on the strike out application prior to any potential contempt proceedings being issued. This is where Shah differs from Kirk. In Kirk the personal injury claim was settled prior to a determination of any sort from the court. In addition, it would probably be worth considering what issues have already been decided by the court prior to issuing contempt of court proceedings.

In any event, it does not appear that the issue of contempt of court was raised before the Court of Appeal in Shah and the court did not take the opportunity to make any comment in relation to it.

However, what is clear from both decisions is that the courts will deal severely with any party who exaggerates their claim. But practitioners should bear in mind that making an application for strike out (as in Shah) is a less expensive way of dealing with a purportedly false claim than issuing an application for contempt of court (as in Kirk).