CLAIMANT WAS NOT FUNDAMENTALLY DISHONEST: TO WHAT EXTENT CAN A DEFENDANT EXPLORE “PERIPHERAL” MATTERS WHEN MAKING ASSERTIONS OF DISHONESTY?

In Long v Elegant Resorts Ltd [2021] EWHC 1330 (QB)HHJ Pearce (sitting as a Judge of the High Court) considered, and rejected, an argument that the claimant had been fundamentally dishonest.  In fact the claimant beat his own Part 36 offer and received an additional £50,497. The case contains a consideration of how far a defendant needs to plead, or put the claimant on notice, of allegations of fundamental dishonesty, particularly in relation to “peripheral” matters.

 

THE CASE

The claimant brought an action for damages for personal injury. The defendant’s case was that the claimant was not seriously injured and that he had exaggerated his case.

 

THE LAW AS TO FUNDAMENTAL DISHONESTY

The judge considered the statute in relation to fundamental dishonesty and the requirement that the claimant be put on notice.

Fundamental Dishonesty
70.               Insofar as relevant, section 57 of the Criminal Justice and Courts Act 2015 (“CJCA 2015”) provides as follows:
“Personal injury claims: cases of fundamental dishonesty
(1)    This section applies where, in proceedings on a claim for damages in respect of personal injury (“the primary claim”) —
a.       the court finds that the Claimant is entitled to damages in respect of the claim, but
b.       on an application by the Defendant for the dismissal of the claim under this section, the court is satisfied on the balance of probabilities that the Claimant has been fundamentally dishonest in relation to the primary claim or a related claim.
(2)    The court must dismiss the primary claim, unless it is satisfied that the Claimant would suffer substantial injustice if the claim were dismissed.
(3)    The duty under subsection (2) includes the dismissal of any element of the primary claim in respect of which the Claimant has not been dishonest.
(4)    The court’s order dismissing the claim must record the amount of damages that the court would have awarded to the Claimant in respect of the primary claim but for the dismissal of the claim.
(5)    When assessing costs in the proceedings, a court which dismisses a claim under this section must deduct the amount recorded in accordance with subsection (4) from the amount which it would otherwise order the Claimant to pay in respect of costs incurred by the Defendant
71.               In considering whether an allegation of dishonesty is made out, the court must bear in mind the following:
i)                    The test for dishonesty is that set out in paragraph 74 of the judgment of Lord Hughes in Ivey v Genting [2016] UKSC 67:
When dishonesty is in question the fact-finding tribunal must first ascertain (subjectively) the actual state of the individual’s knowledge or belief as to the facts. The reasonableness or otherwise of his belief is a matter of evidence (often in practice determinative) going to whether he held the belief, but it is not an additional requirement that his belief must be reasonable; the question is whether it is genuinely held. When once his actual state of mind as to knowledge or belief as to facts is established, the question whether his conduct was honest or dishonest is to be determined by the fact-finder by applying the (objective) standards of ordinary decent people. There is no requirement that the Defendant must appreciate that what he has done is, by those standards, dishonest.”
ii)                  The burden of proving that a witness has been dishonest, a proposition which is not self-evident, lies upon the party alleging it (see Robins v National Trust [1927] AC 515);
iii)                The standard for proving dishonesty in a civil case is the balance of probabilities (Secretary of State for the Home Department v Rehman [2001] UKHL 47, applying Re H [1996] AC 563);
iv)                However, an allegation of dishonesty is a serious allegation that will require appropriately cogent evidence to persuade the court (Re H op. cit.).
72.               As to whether any dishonest conduct should be found to be “fundamental”, Julian Knowles J in London Organising Committee of the Olympic and Paralympic Games v Sinfield [2018] EWHC 51 at paragraph 61 conveniently sets out the law. Having reviewed the authorities, he stated:
In my judgment, a Claimant should be found to be fundamentally dishonest within the meaning of section 57(1)(b) if the Defendant proves on a balance of probabilities that the Claimant has acted dishonestly in relation to the primary claim and/or a related claim … and that he has thus substantially affected the presentation of his case, either in respects of liability or quantum, in a way which potentially adversely affected the Defendant in a significant way, judged in the context of the particular facts and circumstances of the litigation.”
73.               In its defence, the Defendant reserved its position as to what injuries the Claimant had suffered as a result of the accident. By the time of the service of the Counter Schedule dated 18 September 2020, the Defendant’s position had hardened to the following:
i)                    It was denied that the Claimant had suffered any injury (or at least any injury of significance) in the accident;
ii)                  Insofar as an alternative explanation for any symptoms suffered by the Claimant was to be advanced, they were probably a continuing manifestation of a pre-existing condition, triggered by redundancy rather than the accident;
iii)                The Defendant proposed to explore the Claimant’s genuineness at trial;
iv)                The Claimant had falsely represented to that his redundancy in April 2015 was or may have been accident related and that, absent the accident, the redundancy would not have caused him stress in any event.
74.               In the Defendant’s written skeleton argument, served for the purpose of trial, the Defendant added to this:
i)                    That the Claimant was “a demonstrably unreliable historian” in respect of issues other than merely the circumstances of his redundancy;
ii)                  That the Claimant appeared to be a man who exaggerates and therefore his evidence must be treated with the utmost caution.
75.               During the trial, counsel for the Claimant at various points objected to lines of questioning by counsel for the Defendant on the ground that they went to issues of dishonesty that had not been pleaded. In this regard, I bear in mind the judgment of Newey LJ in Howlett v Davies [2017] EWCA Civ 1696. At paragraph 31 of his judgment, he said:
Statements of case are, of course, crucial to the identification of the issues between the parties and what falls to be decided by the court. However, the mere fact that the opposing party has not alleged dishonesty in his pleadings will not necessarily bar a judge from finding a witness to have been lying: in fact, judges must regularly characterise witnesses as having been deliberately untruthful even where there has been no plea of fraud. On top of that, it seems to me that where an insurer in a case such as the present one, following the guidance given in Kearsley v Klarfeld [2006] 2 All ER 303, has denied a claim without putting forward a substantive case of fraud but setting out ‘the facts from which they would be inviting the judge to draw the inference that the plaintiff had not in fact suffered the injuries he asserted’, it must be open to the trial judge, assuming that the relevant points have been adequately explored during the oral evidence, to state in his judgment not just that the Claimant has not proved his case but that, having regard to matters pleaded in the defence, he has concluded (say) that the alleged accident did not happen or that the Claimant was not present. The key question in such a case would be whether the Claimant had been given adequate warning of, and a proper opportunity to deal with, the possibility of such a conclusion and the matters leading the judge to it rather than whether the insurer had positively alleged fraud in its defence.”
76.               During closing submissions, counsel for the Claimant made the valid point that the demands of ensuring that costs are proportionate means that a Claimant cannot be expected to incur cost in exploring factual issues in advance of a trial which are apparently peripheral, merely in order to cover the risk that, at trial, the Defendant will cross-examine on those issues and seek to establish inconsistencies in the evidence which are then said to be evidence of dishonesty.
77.               In my judgment, the court must be careful about drawing conclusions adverse to the honesty of a Claimant from evidence about peripheral issues, most particularly where the Defendant has not given adequate advanced warning of its intention to raise the particular issue. Indeed, having regard to the passage from Howlett v Davies referred to above, the court would doubtless consider preventing cross-examination in such circumstances, on the ground that fairly reaching a conclusion adverse to the Claimant and that therefore the cross-examination was inappropriate. This was the approach taken by HHJ Coe QC in paragraph 14 of her judgment in Pinkus v Direct Line [2018] EWHC 1671 (QB) and it is one with which I agree. I would have been minded to apply the same principle to cross-examination on peripheral matters which a Claimant has understandably declined to investigate, having regard to the need to conduct litigation at proportionate cost.
78.               In this case, the Defendant has adequately given notice of its intention to explore the circumstances of the Claimant’s redundancy. Ironically, the lack of investigation of this point has been arguably more on the Defendant side that it has been on the Claimant’s (at least insofar as evidence placed before the court is concerned), a point of some significance on this issue, as identified below. However, I see no unfairness in the Defendant having been allowed to explore the issue and thereafter seeking to draw an inference of dishonesty from the evidence, given that this is a central issue in the case. Further, insofar as the court has been concerned with the genuineness of the Claimant’s symptoms, his reliability as a historian has been an issue throughout the case. The alleged tendency to exaggerate has arisen more recently and in any event, as will be considered further, has been suggested at times to be a consequence of a somatic symptom disorder, rather than deliberate exaggeration. however, again, the accuracy of the Claimant’s reporting is inevitably a central issue in this case. I am satisfied that, with the appropriate approach to the application of the burden of proof, as set out above, no injustice is done to the Claimant through the failure to raise this point more clearly or at an earlier point in time.
79.               I should add that I have had regard to the judgment of Master Davison in Mustard v Flower [2021] EWHC 846 which was heard and decided after I heard the trial in this case and therefore was not referred to in submissions. I would agree with his analysis of the law, which is close to mine as set out above.

NO FUNDAMENTAL DISHONESTY HERE

The judge dismissed the allegations of fundamental dishonesty.
Issue 5 – Was any exaggeration by the Claimant of his injury/symptoms deliberate?
  1. There are two discrete areas of the Claimant’s evidence, not relating to the symptoms as such, but rather to his underlying condition and the consequence of the accident, where the Defendant has alleged that the Claimant has deliberately misstated the position.
  2. The first relates to what the Claimant had to say about the scan results in May 2015. As I have indicated under the heading of Issue 3 above, the scanning was reported in terms that excluded any serious brain damage. However, the Claimant reported that he had had a “small bleed” (GP note of 9 April 2015) and “internal swelling and bleeding intracranially of brain” (accident report of 20 April 2015). The Defendant identifies these as examples of the Claimant deliberately misstating his condition. As Mr Dignum QC put it in cross examination to Dr Pierce, “when he signs the document on 20 April, he knows he has not got a bleed and never has a bleed to his brain…”
  3. The reason for the Claimant describing his injury in this way was explored at some length in evidence. The Claimant’s account in cross examination was that he was told they were “investigating a bleed or bruising at the back of my bran … and that conversation went on for basically four days while I was in hospital and so that is where I got the impression … that there had been some kind of intracranial bleed or, I mean the internal swelling is taken given that I had a head injury but the bleeding intracranially came from conversations with particularly there was a specialist from Liverpool who came in to see me, ordered specific CT scans and he was the person that said this is what we are looking at.” It is common ground that Dr Fletcher, who carried out neurological review at CoC on 31 March 2015, had come from the Walton Centre in Liverpool and that the reference to a specialist from Liverpool is therefor likely to be a reference to him. As I have noted, Dr Fletcher did indeed query whether the CT scan showed a right occipital contusion, although was ultimately reassured that it did not. Mr Dignum QC contended that the medical records show that his reassurance took place on the day after the scan, 31 March 2015, not 4 days later. His basis for this submission is a nursing note at 18.38 on 31 March 2015 which state, “Pt seen by Dr Fletcher CT reviewed by Walton informed that scan is normal.” The Defendant takes that note as an indication that, after Dr Fletcher saw the Claimant on 31 March and raised the issue of whether the scan showed a contusion. He obtained reassurance from the Walton Centre and later saw the Claimant again. Whilst clearly this is a possible sequence of events, one might have expected that Dr Fletcher would himself have made a note if he had seen the Claimant again. The nursing note is also consistent with the nursing staff having reviewed the information that the scan was reassuring. If that was so, there is no evidence as to when the Claimant was reassured. On the other hand, a note from Dr Chakrabarty on 2 April 2015 states that the Claimant could be discharged after a radiology meeting to discuss his scan – that suggests that the reassuring message was not even able to the doctors until towards the end of the Claimant’s admission.
  4. During questioning from me, Dr Heaney accepted that, had Dr Fletcher raised with the Claimant the suggestion that the scan might be abnormal and had the Claimant pressed Dr Fletcher on what the potential abnormality was, Dr Fetcher may have explained in a way that mentioned the concept of “a bleed on the brain” or similar. I cannot be satisfied on this evidence that any misstatement of the scan results from the Claimant resulted from a deliberate attempt to misstate the severity of his injury.
  5. The second matter is the Claimant’s accounts to Dr Pierce and Dr Heaney of his fibromyalgia. Dr Pierce recorded at paragraph 2.8 of her report of June 2018 that the fibromyalgia “had resolved and that he had not ‘flare ups’ of pain for years prior to the index accident. Dr Heaney recorded at paragraph 3.1.7 of his report that the Claimant said to him “on direct questioning that in or around 2007 he had been diagnosed with fibromyalgia after experiencing joint pain and he had been treated in a pain management clinic. He told me that this condition did not cause any problems.” In each case, it seems that the Claimant gave an incorrect account of the fibromyalgia. For example, on 20 June 2014, the Claimant’s GP reported “has fibromyalgia and pain is worse again.”
  6. That said, there are pointers against concluding that the Claimant was deliberately misstating this condition to Dr Heaney. The severity of the condition was undoubtedly fluctuant, and the evidence summarised at paragraph 80 above tends to suggest that his condition as being much better in the 2-3 years before the accident that it had been in the previous 5-6 years. In the last direct reference to fibromyalgia before the accident, a GP attendance on 4 September 2014, the condition is said to be stable.
  7. More importantly, the Claimant told Dr Bourke [23], Dr Bird [24] and Dr McCulloch [25] of the diagnosis of fibromyalgia, so if he was attempting to deceive doctors as to his medical history, his attempt was poorly executed. Given that the Claimant gave an account of his alleged fibromyalgia to other doctors (albeit that he disputed the account) it does not seem to me reasonable to conclude that his statement to Dr Heaney was an inaccurate one made with the deliberate attempt to deceive.
  8. I have considered to what extent the Claimant’s account may involve deliberate exaggeration, not as a feature of a somatic condition, but rather simply over stating his symptoms so as to increase his damages. I have to accept the possibility that some exaggeration of this kind might have taken place. Some of the florid accounts given by the Claimant might be thought to be such. Any finding that the Claimant had misstated his case so as to increase his damages would be a serious allegation, to be determined on the balance of probabilities, but requiring compelling evidence. Three points lead me to the conclusion that I cannot be satisfied on the balance of probabilities that any particular account of his symptoms was deliberately exaggerated in this sense, rather than as a manifestation of an underlying somatic disorder:
  9. i)Given my judgement on the underlying cause of the Claimant’s symptoms, namely FNSD and SSD in the context of a history of fibromyalgia, any particular apparent exaggeration may be explained by that medical history rather than a conscious attempt to exaggerate the claim;
  10. ii)In fact, there is some reasonable consistency between the various accounts of the Claimant as to the course of his symptoms;
iii)                The improvement in the Claimant’s symptoms since 2018 suggests that he is not deliberately exaggerating his claim so as to maximise recovery.
  1. I am fortified in this conclusion by the fact that, whilst the Defendant’s case has not conducted its case on exaggeration by suggesting that the Claimant has repeatedly exaggerated his symptoms. Whilst the Defendant does contend that there have been some specific cases of exaggeration, which are considered below in issue 5, it has focused on defending this claim on the causation of the Claimant’s symptoms and the significance of his redundancy, rather than saying that large swathes of his complaints are invented.
Issue 6 – Has the Claimant given an honest account of the circumstances leading to his redundancy, whether he believes that he would have been made redundant in any event and/or what his response to the redundancy would have been absent the accident?
  1. I have set out under issue 3 above my reasons and conclusion that the tone of the document does not accurately reflect the Claimant’s thinking as of 10 March 2015. I accept, for reasons given earlier, that the Claimant did not see his redundancy as an inevitability at the time of the accident.
  2. It does not automatically follow from the finding on Issue 3 that the Claimant has not been guilty of dishonesty of this issue. It would be dishonest by the standards of ordinary people to give a deliberately misleading account of the circumstances of the redundancy even if the motivation in doing that were to bolster the Claimant’s true belief that the redundancy was not inevitable and/or that the Claimant’s ill health was not related to the redundancy.
  3. But there are several puzzling features relating to the Claimant’s redundancy. Whilst in part these flow from an apparent inconsistency in his account of the circumstances (which for understandable reasons plays a significant part in this case), there are other features which suggest that the court does not have a full picture before it.
  4. The starting point is that the Claimant had only relatively recently been taken on by the Defendant as its head of IT. Whilst Mr Dignum on behalf of the Defendant sought to draw attention to some weaknesses in the probationary reviews that had taken place, the Defendant had nevertheless felt able to offer the Defendant a permanent post shortly before the accident. Further, when the question of the redundancy arose, Ms Helen Smith said in an email to the Claimant, “your performance isn’t in question.
  5. However, the Claimant was made redundant some months before any potential successor was employed. Mr Jones (who cannot be expected to have detailed knowledge of such matters) accepted that Mr Long was made redundant in April 2015 but that his replacement did not come in until “later that year.” Mr Long’s own case (see paragraph 9 of his fifth witness statement) is that the new head of IT was appointed in August 2015. The Defendant has not sought to contradict that, even doubtless it would have available the evidence necessary to do so. Based on this evidence, I conclude that the new head of IT, who was in effect the Claimant’s replacement, albeit that the job may have been at a higher level, was not appointed until about four months after the Claimant was made redundant. This is strongly suggestive that the Claimant’s redundancy was accelerated, so as to take effect earlier than the true point of redundancy.
  6. The Claimant’s account of the circumstances of his redundancy closest in time to the accident, is contained in the May 2015 Document. It is the Claimant’s case that the document was drafted together with the assistance of employment lawyers. It sets out essentially four grounds of appeal:
  7. i)That the Defendant had failed to follow a fair process;
  8. ii)That the terms of the Claimant’s redundancy were not clear;
iii)                That the Defendant failed to make reasonable adjustments for the Claimant’s disability; and
  1. iv)That the Claimant had been bullied by Mr Redmond Walsh.
  2. It must also be borne in mind that the Claimant’s account in the May 2015 Document was available for the medical experts and the Defendant’s legal advisors to see. The very fact that it has only played a major role in this case at a very late stage notwithstanding that it has been referred to in disclosed documents throughout the litigation might suggest that it the document does not bear the significance that the Defendant contends for. But it does not necessarily follow from this that the Claimant was not trying to mislead people on this issue. For example his assertions about his redundancy to Dr Bourke which were taken as an indication that no possibility of redundancy had arisen before the accident might have been made by the Claimant in the context of his either having forgotten about the May 2015 Document or in the belief that the document would not come to light.
  3. On balance however I am not persuaded that the Claimant’s failure to refer to the risk of redundancy, whether to Dr Bourke or more generally in this ligation was a deliberate attempt to deceive. I say this for the following reasons:
  4. i)I repeat that a finding of a deliberate attempt to deceive would require cogent evidence.
  5. ii)Other aspects of the Claimant’s evidence, upon which I have commented, suggest that he is not someone prone to lying when the circumstances suit;
iii)                For reasons set out under issue 3, I conclude that the extreme reaction to the risk of redundancy only arose in May 2015. It follows that the Claimant would not naturally associate his deterioration in health which had already occurred started by then with the redundancy;
  1. iv)It would be understandable if the detailed sequence of events in respect of the redundancy have not been in the forefront of the Claimant’s mind during the litigation process, in particular if he does not attribute any health consequences to the redundancy.
  2. In my judgment, it is more probable that the Claimant’s failure to refer to the redundancy as a possible cause of his ill health or, in the case of his consultation with Dr Bourke, even to acknowledge the risk of redundancy at all prior to the accident, is more probably a consequence of an unswerving conviction that it was the accident rather than the redundancy that has caused his various symptoms coupled with the failure to recall the detail of a redundancy process which in his mind was of no relevance to the issues in the litigation.
Issue 7 – Has the Claimant has been guilty of Fundamental Dishonesty within the meaning of Section 57 of CJCA 2015?
  1. It follows from my conclusions under issue 6 that there is no finding of dishonesty here which could be described as “fundamental” and so issue 7 is resolved easily in favour of the Claimant.

THE ORDER FOR COSTS

The claimant recovered damages and costs.   The judgment records that the claimant had beat his own Part 36 offer and recovered an additional £50,497 pursuant to CPR 36.17(4)(d).