Keoghs Casebook – Fraud Analysis April ‘17
With the volume of successful cases currently experienced by our fraud team, we’ve decided to dip into our casebook and provide some extracts in a new regular blog post on the art of the possible when defeating fraudulent claims.
Over the coming months these thematic snippets should help build a library of useful tactics and information on fighting fraud.
In our first post we explore some of the more unusual strategies employed to push a case to a successful outcome…
More than one way to skin a cat
With Keoghs counter-fraud teams focussed on investigating suspected frauds of various types, pleading fundamental dishonesty and pursuing contempt of court actions; one could be forgiven for presuming that such approaches become the only focus of a case.
In actual fact, Keoghs fraud lawyers use a number of tactics to defeat claims alongside standard counter-fraud and intelligence led investigations. Here we flag recent cases which demonstrate how our lawyers ensure they utilise all tools at their disposal in defeating fraudulent claims, ensuring maximum return on investment for our clients.
Case 1: Credit Hire Company made to pay
In our first highlighted case, a suspected staged accident, the judge at trial in Bradford County Court found that the claimant had not proven his case but stopped short of making a finding of fraud.
However, as a result of concerns related to the claim for hire charges presented, Keoghs Partner, Elaine Ibbotson, applied for and successfully obtained a costs order against the hire company, leaving them with a bill of £60,000 for our client’s costs in the long-running litigation; costs that would never have been recoverable from the impecunious claimant directly.
This decision shows the potential benefit of securing a costs order against a credit hire company where their conduct can be called into question and they can be seen to have controlled the ultimately unsuccessful litigation. During cross-examination, the claimant made it clear he had tried to abandon the claim at an early stage but was compelled to continue to trial by the hire company.
Case 2: Burden of proof weighs heavy on claimant
In a recent case at Preston County Court where both the claimant and defendant were poor witnesses, the judge struggled to make a decision on what the actual truth was and found that the claimant simply hadn’t done enough to prove his case. The claimant appealed, arguing that the judge had to reach a conclusion as to whose evidence he preferred as opposed to sitting on the fence. However, in response to the appeal, Associate, Gareth Berry, successfully argued that it was open to a judge to dismiss a claim on the basis that the claimant had not proven his case.
When considering whether to defend a claim all the way to trial, the quality of witness evidence is always a key factor to take into consideration. In some cases – particularly where claims litigate close to limitation – the memories of witnesses will inevitably fade and the quality of their evidence can diminish. This appeal decision shows that trial judges are entitled to simply dismiss a claim if the burden of proof has not been met by the claimant bringing the claim.
Case 3: Are you sure you have the right defendant?
From time to time we all come across cases where the policyholder denies involvement in a collision. Here, Keoghs’ Fraud Rings Team successfully dis-applied QOCS under CPR 44.15 and obtained costs from the claimant on the basis that they had not properly identified who their claim should have been brought against.
There are a number of exclusions from QOCS which relate to deficiencies in the manner in which the proceedings are brought. These include an absence of reasonable grounds to bring the claim, abuse of process, or where the conduct of the claimant or their representatives is likely to obstruct the just disposal of proceedings.
The result in this case highlights the risk to the claimant in ignoring protestations from the defendant that ‘it wasn’t me’, with the potential escalation and costs consequences if they get it wrong. If a claimant issues proceedings against a defendant who could have easily been established as not involved had reasonable enquiries been made, QOCS protection can be lost and enforceable costs orders made.
Case 4: For want of a translation clause
Keoghs Associate, Tim Ibbotson, picked up on a sneaky point in a case he recently ran in Clerkenwell and Shoreditch County Court. How often do we discover late in the day that the claimant needs an interpreter at trial because he can’t speak English? When this happened in Tim’s case he indicated to the claimant’s solicitors that their client’s witness statement was not valid and opposed the claimant’s application for permission to serve a translated statement. At the hearing, the court struck out the claim, observing that the particulars of claim were invalid without the requisite translation clause. As a result, the claimant’s solicitors were ordered to pay wasted costs.
This case demonstrates that the late revelation that a claimant can’t speak English and needs an interpreter can be turned into a positive. For one, the absence of a translation clause provides the opportunity for a strike-out due to the particulars of claim being inadmissible. Also, if a claimant solicitor later seeks to use an interpreter there is potential to apply to have the statement declared inadmissible due to lack of proper statement of truth.
The claimant’s representatives should of course make proper enquiries into their client’s ability to understand the documentation relating to their claim. Where language difficulties are not identified and properly addressed by the claimant’s representatives at the outset of the claim, they run the risk of being liable to pay wasted costs should the claim subsequently be struck out, as in Tim’s case, or where delays are caused by late attempts to rectify deficiencies in the claimant’s evidence.
Case 5: More than one bite of the cherry
Our final highlighted case saw Keoghs Partner, Avrom Topperman, persuade a claimant to drop his issued claim for personal injury on the basis that it represented a ‘second bite of the cherry’. Unbeknown to the claimant, his own insurers had issued proceedings for their outlay without his knowledge some time earlier. A number of technical arguments were raised as to when the time honoured principle of ‘one bite only’ would apply as there were a number of contra-indicators to the principle applying in this case. However, with case-law broadly supportive of the defendant’s position, the claimant discontinued.
A second set of proceedings covering a claim for injury excluded by a previous set of proceedings (which arose from the same cause of action) can, in certain circumstances, be deemed an abuse of process. A 2009 Court of Appeal case sets out some clear guidance that the court should take into account when determining such issues and the key will generally be whether new information has genuinely come to light since the first set of proceedings.
Second sets of proceedings will often be a feature in cases of late notified personal injury claims where there may also be questions over whether the claimant is actively providing instructions to proceed with the claim and/or whether the claimant was genuinely injured. In such cases, the abuse of process argument can be a highly persuasive point in securing an early discontinuance.
Keep an eye out for our next excerpts from the Keoghs fraud casebook, dealing with a variety of fundamental dishonesty cases.
In the meantime, bookmark us here to keep up to date with all the latest news and views from the fraud team.
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