Late claims found fundamentally dishonest
Fraud Aware Issue 4
Costs have been awarded to LV= following fraudulent personal injury claims brought up to 23 months after the accident. This is the first instance where LV= have applied to have two claims case managed in an application to have QOCS dis-applied due to fundamental dishonesty.
The cases of Daniel Wolstencroft v Mohammad Nazim & Liverpool Victoria and Anthony Allen v Ken Roberts were heard together at Stoke on Trent County Court by His Honour Judge Main QC on Tuesday 26th May 2015.
Whilst separate cases, the circumstances of the claims followed a similar pattern and both claimants were represented by the same claimant solicitors. In both instances, personal injury claims were not made at the time of the accidents, instead, they were made up to 23 months later.
In the case of Mr Wolstencroft, an accident happened on 2nd November 2010, but a claim was only pursued after Mr Wolstencroft was contacted by Complete Claims Solutions (CCS), and subsequent proceedings were issued by Mr Wolstencroft via his solicitors LA Law Ltd in October 2013. Mr Wolstencroft was examined for the purposes of a medical report, which recorded his complaints of back and shoulder problems which interfered with his sleep and his rest.
In the case of Mr Allen, the accident occurred on 1st November 2012 and proceedings were issued in July 2014. Mr Allen contended that he suffered neck and lower back pain requiring analgesics for 12 months and one day off work.
However, when LV= investigated the claims, they were able to access recordings of telephone conversations with the claimants following the accidents. In the recordings, LV= representatives questioned the claimants regarding personal injuries and in both cases the claimants confirmed that there had been no injuries.
On this evidence, both claimants sought to discontinue their case. However, in the circumstances, Keoghs, acting on behalf of LV=, put to the judge that the claimants had been fundamentally dishonest and therefore costs should be awarded on behalf of LV=.
The judge was satisfied that both cases were dishonest and set aside QOCS protection in order to award costs. In regards to Mr Wolstencroft’s claim he stated: “I am satisfied that there has been dishonesty, it goes to the very root of the claim … and this is a classic case where the rules relating to one-way costs shifting should be set aside and the defendants should be entitled to recover their costs.”
Ben Leech, Associate at Keoghs who handled the claims, commented: “Following the LASPO reforms we have seen an increase in the number of fraudulent late claims being presented to insurers. The QOCS protection offered to a claimant means that there is little, if any, disincentive not to pursue a claim; the claim also represents an investment to claims farmers (the solicitors or claims management companies who pursue the claim) providing them with a real financial incentive to convert the ‘case’ into cash.
“Therefore, this result is welcomed and proves that insurers and the courts will not stand for this type of fraudulent activity. There are powers within the legal system to pursue fraudulent claimants and remove the costs protection that they do not deserve.”
Clare Lunn, Head of Claims Crime Prevention at LV= said, “Claims farming remains a significant problem for the industry, with farmed claims representing circa 25% of monthly portal cases. This positive result sends a strong message to both claimant solicitors and claims management companies that insurers will pursue fraudulent claimants for reimbursement of their costs. LV= takes a tough stance on fraud and late reported claims and will not allow claimants to simply ‘try it on’ and then walk away.”