Personal injury claims and contempt of court: a recent case study

On behalf of the defendant insurer, Kennedys recently secured a finding of contempt against a claimant who fraudulently alleged an inability to work as a roofer following a road traffic accident.

Background

On 17 August 2019 Mr Higham was struck as a pedestrian by a vehicle insured by Haven Insurance Company Limited. Primary liability for the incident was admitted pre-litigation.

On 19 July 2022 Mr Higham issued court proceedings making a claim for damages up to £200,000. He alleged that due to ongoing issues with his knee and shoulder, he avoided doing DIY and using ladders as it was unsafe for him to do so. He also alleged that he had not been able to return to work as a roofer due to his ongoing knee and head injuries, as well as ongoing symptoms such as dizziness. A similar picture had been painted by Mr Higham to the two medico-legal experts instructed by the claimant. A claim was therefore made by Mr Higham for his alleged loss of earnings.

Surveillance undertaken by the defendant insurer

Mr Higham had, however, been under surveillance by the defendant insurer since late 2020. This showed Mr Higham “displaying considerable agility whilst going up and down ladders”.

Relying on the surveillance, on 10 December 2022 Kennedys served a defence and counter schedule alleging fundamental dishonesty. Mr Higham then discontinued his claim. In view of the serious nature of the attempted fraud, our client pursued the Claimant for contempt of court as a deterrent to future fraudulent claims.

Contempt proceedings

Mr Higham admitted to being dishonest in his response to the contempt proceedings and Mr Justice Cotter heard the matter on 1 December 2023. 

The judge held that Mr Higham persistently “chose deliberately to pursue a course of fraud” and had only discontinued in the face of “overwhelming evidence of dishonesty”.

Mr Justice Cotter held that the custody threshold had been crossed because of the claimant’s “serious and persistent course of conduct”.

Ultimately “by the narrowest of margins and applying the Court’s mercy”, Mr Justice Cotter suspended the two month sentence for one year due to the Claimant’s significant mitigating circumstances.

Comment

The pursuit of a fraudulent insurance claim is often misunderstood to be an action resulting at worst in a costs sanction. Pursuing a further sanction after the successful defence of the claim allows an insurer to protect its position, and that of its shareholders, by ensuring that a strong message goes out to potential fraudsters that their actions will not be tolerated. A criminal conviction is a sanction that has a significant impact on those who bring fraudulent claims and, in the right cases, it is an effective deterrence tool for insurers.