FINDING OF FUNDAMENTAL DISHONESTY AT TRIAL OVERTURNED ON APPEAL: THE TRIAL JUDGE WAS WRONG TO RELY ON AN INJURY THAT DID NOT FORM PART OF THE CLAIMANT’S PLEADED CASE

I am grateful to Express Solicitors for sending me a copy of the judgment of HHK Baddeley in Robinson -v- UK Insurance Limited, a note that  case and of the judgment is available here –Robinson word . HHJ Baddeley was hearing an appeal from a trial where the claimant had been found to have been fundamentally dishonest in advancing a claim for personal injuries  to his shoulder that was not caused by the accident.  That decision was overturned on appeal. The claimant had advanced the claim pre-issue but not pursued it once the medical expert stated that the shoulder in jury was not related to the accident. The shoulder injury had never been part of the claimant’s pleaded case and the

“It is unclear from the note why he concluded that the Claimant’s dishonesty was fundamental to the claim. In my judgment, he was wrong to so find. The shoulder injury had no bearing on the claim that was issued, which was a £1,500 claim for 2 weeks of minor injuries. I don’t accept the fraudster’s charter argument put forward. I agree with the advocates that it is a question of fact and degree. There is a floodgates argument the other way. Should the Defendant be encouraged to litigate the detail of every issue litigated pre-proceedings in the hopes of a fundamental dishonesty finding where it is not subsequently litigated? The answer must be “no”. Here the Claimant must have been found to be dishonest regarding the shoulder and neck, but when the medical evidence didn’t support it he abandoned it. It did not go to any issue pleaded in the claim. It did not go to the root  of the claim that the Claimant brought. I find that it was not fundamental to the claim and DDJ Masheder was wrong to find that it was.”

THE CASE

The claimant brought an action for damages for personal injury arising out of a road traffic accident. In the  CNF he made a claim for an injured shoulder.  However when medical evidence was later obtained it stated that the shoulder injuries were not related to the accident.  When proceedings were issued the claimant relied on the medical evidence and did not plead that he suffered a shoulder injury.

The claimant’s action failed at trial. The Deputy District Judge found that he was dishonest and also, by initially advancing a claim that he had a shoulder injury, he was fundamentally dishonest.

THE CLAIMANT’S  SUCCESSFUL APPEAL AGAINST THE FINDING OF FUNDAMENTAL DISHONESTY (ALTHOUGH IT TOOK SOME TIME…)

The claimant appealed against the finding of fundamental dishonesty.  The appeal appears to have taken a considerable time to reach the appeal judge. This was because there was no transcript of evidence available, the trial judge had retired and a considerable amount of time was spent attempting to obtain a transcript and then agree written notes.

THE JUDGMENT OF HHJ BADDELEY ON APPEAL

(This judgment is a note taken by barrister Jonathan Brownson,  who represented the claimant)

“The Claimant in this case is Nicholas Robinson. The Defendant is UK Insurance Ltd. The Claimant brings this appeal against the finding of Deputy District Judge Masheder at the trial on 10th November 2020 that his personal injury claim was fundamentally dishonest and that he must pay the Defendant’s costs of £3,104.16. There is no appeal against the dismissal of his personal injury claim for lack of proof.

“Mr Brownson represented the Claimant / Appellant today, as he did at the trial. Mr Gaydon represented the Defendant / Respondent. He was not trial counsel. Trial counsel for the Defendant, like DDJ Masheder, has retired since the date of the trial. The relevant chronology is as follows. On 2nd February 2017 [sic], this was the date of the accident and the Claimant was thrown from a quad bike. On 10th May 2018 the Claimant contacted his GP. The note reads, “RTA three months ago. Toothache-like pain. Diagnosis: shoulder joint pain” [p87]. The records note that the Claimant did not attend, but did a few days later on 14th May 2018, the note reading:

“Pain in right shoulder girdle and right clavicle. Had an accident over a year ago and now pains in the last four months progressively worse and, at times, right arm feels swollen and numb and has to shake it at times to get sensation back.
“Right shoulder: no joint line tenderness. Tender right trapezius. Vaguely tender over clavicle. Rest of arm and forearm no swelling.
“Diagnosis: shoulder tendonitis. Will refer to Orthopaedic CATS. Took exception to my asking him about smoking. Cannot see how it is related or causing shoulder pain.
“Ultrasound right shoulder and Xray shoulder and clavicle.”
The note of the shoulder x-ray showed no abnormality. On 28th July 2018 [sic], the Claimant served a Claims Notification Form through his solicitors. In terms of the injuries alleged, the CNF said he had, “sharp pain in right shoulder, bruising to both legs, both arms and left ankle”. 22nd December 2018 the Claimant saw his medicolegal expert, Dr Qureshi. Dr Qureshi’s report notes that he complained of pain and stiffness and discomfort in the neck and right shoulder, which onset at 1-2 weeks and that he had ongoing moderate symptoms. The report records that he found 10% restriction…. Appeared to cause discomfort and tender right trapezius muscle and a 10% restricted movement of his right hand behind his back. He recommended an orthopaedic referral and also noted 2 week injuries sustained…
“Following Dr Qureshi’s referral, on 23rd April 2019 he saw Mr Helm. On examination, he noted end of range discomfort on external rotation and adduction and positive scarf test … Mr Helm’s opinion included the following [p88]:

“I do not think his present right shoulder symptoms are related to the accident of 26.02.2017. According to the General Practitioner’s records, he did not develop symptoms in the right shoulder until many months after the index accident and although, sometimes, whiplash injuries and similar types of soft tissue injury do not cause pain for a day or two, I cannot conceive of any injury not causing symptoms for many months before becoming symptomatic.

“His present symptoms are probably constitutional. Aches and pains in the neck and shoulder girdle are, in fact, fairly common in the general population, often due to minor wear changes in the joints and related soft tissue structures of the shoulder.
“It is difficult to know if he did sustain any significant injury at the time of the accident as there are no contemporaneous medical records and his memory of the events is unclear.”
“These proceedings were issued on 31st January 2020. There was no reference in the Claimant’s pleaded claim to the neck or shoulder injury that he went to see Mr Helm about. Under Particulars of Injury, it said, “As a result of the accident the Claimant sustained anxiety, bruising to his leg, grazing to his left leg and grazing to his ankle.” The Claimant served a witness statement in the litigation dated 3rd August 2020. He deals with his neck and shoulder at paragraphs 39 and 40. He says:
“Mr Helm has said that he agreed was probably injured as I was thrown from a quad bike and would expect me to suffer injuries such as those to my arm, ankle and leg. Mr Helm has said that because of the length of time between the accident and me going to my GP about the shoulder pain, he cannot say that it is due to the accident and is probably just one of those things.

I always thought it was due to the accident, but Mr Helm is right, I did not complain of this injury and I even accept that it went away before coming back. Mr Helm is the expert and if he thinks my current shoulder symptoms are not due to the accident I will agree with him. He’s the doctor.”

The matter came for trial on 10th November 2020. Unfortunately there is limited information about what happened at the trial. The recording equipment was not working and there is no transcript available. The Judge and Defendant counsel have retired and all that we have is Mr Brownson’s note. Whilst that is headed non-verbatim, Mr Brownson tells us today that it recorded as far as he was able word-for-word what DDJ Masheder said in the quotation marks. That covered nearly all of the judgment, save for the introduction section and the very last paragraph, which reads, “DDJ Masheder went on to confirm that the Claimant’s attendance upon Dr Helm [sic] (or at least his attempt to place reliance upon
the injury that was the subject of his report) was dishonest and that it was fundamental to the claim.” That bit wasn’t an attempt at a word-for-word record.

“DDJ Masheder’s judgment was surprisingly short and more detail would have been helpful, but there is no appeal on the ground that there was a lack of reasons given. In summary, DDJ Masheder found that given accident circumstances, the Claimant was likely to have suffered some injury. He said it was necessary to take a closer look at the medical records from date of accident to Mr Helm’s report. He noted that the Claimant appears to have accepted that he cannot pursue a claim for shoulder and neck symptoms. The Claimant was cross-examined at some length. He described the Claimant’s evidence thus :
“…the Claimant’s evidence was extremely poor. It is littered with inconsistencies: in respect of both medical reports and in relation to attendances at GP and hospital and inconsistencies contained within his own statement of evidence. The conclusion that I came to quite simply was that yes, he was a poor historian and that in itself is not necessarily a crime, but he just could not really provide the court with any credible evidence, other than the circumstances surrounding the accident itself. ln relation to medical issues, to put it bluntly, the Claimant was all over the place. I came to the conclusion, that in terms of credibility and reliability, I did not find the Claimant to be either a credible or a reliable witness.”

Judge Masheder then went on to say that there must be considerable doubt as to Dr Qureshi’s conclusions because they were based on what he was told by the Claimant and he went on to find that the Claimant had failed to prove a claim. In relation to the parts of the judgment dealing with fundamental dishonest, DDJ Masheder said:
“l then have to move on to consider the issue of fundamental dishonesty. Of course, I have already made reference to the tact that the Claimant has not proved to be a credible witness and that of course Dr Qureshi’s report was based upon what he was told by the Claimant. It seems to me when I consider the fact that I have before me an accident in February 2017 and CNF amended l7th July 2018 that there is some considerable force in the argument here that the Claimant’s purpose has been to effectively increase his claim with a view to financial gain… Perhaps I should have made reference when referring to the Claimant’s evidence in relation to timings, again he was very much all over the place.

When I consider the sequence of events here, I reach the conclusion that in the particular circumstances here, the issue of fundamental dishonesty has been made out and I find accordingly.” “When asked by Mr Brownson to clarify, the Deputy District Judge went on to say that the Claimant’s attendance on Mr Helm or his attempt to place reliance on the injury was dishonest and that was fundamental to the claim.

“Also relevant is what he wrote in the N460 form refusing permission to appeal. He said that the Claimant’s oral evidence was entirely inconsistent with the medical evidence and his own witness statement and his first visit to the GP was with a view to increasing a likely award of damages. There is no reference in the judgment to the test set out at 44.16 of the CPR, but that must have been the test that DDJ Masheder was applying.
“44.16 reads that, “Orders for costs made against the claimant may be enforced to the full extent of such orders with the permission of the court where the claim is found on the balance of probabilities to be fundamentally dishonest.”

“There are two substantive grounds of appeal pursued before me today. Perhaps unsurprisingly, one is dishonesty and the other is fundamentality.
“Dealing first with the dishonesty issue, Mr Brownson’s submission is that the DDJ was wrong to find that the Claimant was dishonest. His judgment is very brief, but when read with the N460 he gives 2 examples where found the Claimant to be dishonest. First, the attendance on Mr Helm and his attempt to place reliance and secondly on his first GP visit on 14th May 2018. Both Mr Helm and [the note from] 14th May 2018 are limited to consideration of the shoulder / neck injury. There is no reference in the judgment to any other aspect of the claim being dishonest. Indeed, he notes that the accident circumstances would have meant that the Claimant was likely to suffer some injury being thrown off. Mr Brownson seeks to persuade me that he was wrong to find dishonesty on the facts. He notes that: injuries were documented on the GP notes; that the GP referred to a diagnosis of shoulder problems; that both medical experts found evidence of restricted range of movement or pain and that no Part 35 questions were put about their findings. It is referred to as uncontroverted evidence per Griffiths v TUI. He pointed out that the C Claimant accepted the med evidence on causation upon receipt of Mr Helm’s report and before issue.

“It is a high bar seeking to overturn findings of fact on appeal. The Appellant’s case is particularly difficult where we have no transcript of the evidence and whilst it is not a requirement to obtain one when dealing with an appeal, it is likely that one would have been obtained if available. The Appellant’s solicitors have been trying to obtain, hence the delay in hearing the appeal. It is common ground that this Court would only overturn where the Judge’s findings were plainly wrong. I am referred to comments of Lord Reid in Henderson v Foxworth Investments Limited and another [2014] UKSC 41… [para 62]:

“…It does not matter, with whatever degree of certainty, that the appellate court considers that it would have reached a different conclusion. What matters is whether the decision under appeal is one that no reasonable judge could have reached.”

“I cannot accept Mr Brownson’s submissions that DDJ Masheder was plainly wrong to find the Claimant to be dishonest. He had the benefit of hearing the evidence and recorded in the N460 that the oral evidence was inconsistent with his own witness statement and medical evidence. I am not sure that all judges would have concluded that the Claimant was dishonest in referring to a shoulder injury in the CNF, but I cannot say on the evidence before me that it was plainly wrong to so find in this case.

Ground 1 fails.

“Moving on to Ground 2. I am referred to the leading cases on fundamental dishonesty. Firstly Howlett v Davies [2017] EWCA 1696, approving the approach of HHJ Moloney in Gosling v Hailo:
“The corollary term to ‘fundamental’ would be a word with some such meaning as ‘incidental’ or ‘collateral’. Thus, a claimant should not be exposed to costs liability merely because he is shown to have been dishonest as to some collateral matter or perhaps as to some minor, self-contained head of damage. If, on the other hand, the dishonesty went to the root of either the whole of his
claim or a substantial part of his claim, then it appears to me that it would be a fundamentally dishonest claim”

“I am also referred to the judgment of Knowles J in London Organising Committee of the Olympic and Paralympic Games v Sinfield [2018] EWHC 51 (QB), a case considering section 57 of the Criminal Justice and Courts Act 2015 and not CPR r.44.16. It is common ground that the test is the same. In that case, Knowles J said [para 62]:

“In my judgment, a claimant should be found to be fundamentally dishonest within the meaning of s 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 (as defined in s 57(8) ), 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. Dishonesty is to be judged according to the test set out by the Supreme Court in Ivey v Genting Casinos Limited (t/a Crockfords Club), supra.

“By using the formulation ‘substantially affects’ I am intending to convey the same idea as the expressions ‘going to the root’ or ‘going to the heart’ of the claim.”

“The Claimant argues that any dishonesty was not fundamental. Mr Brownson raised the “so what” test. All that was said about the shoulder injury were 5 words in the CNF. There has been a sharp pain in the right shoulder. Nothing was said about: duration; when it came on or cleared up; how severe it was or anything like that. Mr Brownson reminds that following the receipt of the med evidence, the Claimant quickly abandoned the neck and shoulder injury and limited the claim to £1,500 and conceded in his witness statement that Mr Helm was the doctor and he would accept his view. Mr Brownson submitted that the shoulder issue didn’t affect the course of the litigation at all. It did not affect the trial on the pleadings; not costs as this was a fixed costs case. This was the very essence of a collateral matter.

“Mr Gaydon for the Defendant responded and disagreed. His submission was that DDJ Masheder was right to find that there was fundamental dishonesty in this case. Mr Gaydon reminded me that most personal injury claims settle pre-issue and a CNF is a vital document. Whilst in a sense it has the same status as a Letter Before Action, unlike that it contains a statement of truth. It has been said that CNFs are important documents, which has to be right. I have been referred to the case of Richards & McGrann v Morris [2018] EWHC 1289 (QB). Mr Gaydon submitted that it would create a fraudster’s charter to say that this cannot amount to fundamental dishonesty and so it would be artificial to draw the line at the commencement of proceedings. That was in the context of a discussion as to the meaning of the words “the claim”. I am told that there is no authority dealing with the issue of whether the claim regarding litigation is taken as starting with the Claim Form or the bringing of a claim for personal injury, which would start at an earlier stage, probably with the CNF.

“Mr Gaydon noted that the Claimant maintained was suffering with shoulder symptoms, although he accepted that no compensation was available.
“When considering fundamental dishonesty, it is a matter of fact and degree. I was referred to the case of Denzil v Mohamed & UK Insurance [2023] EWHC 2077 (KB), which like this case dealt with a non-pleaded issue. In the Denzil case, fundamental dishonesty was overturned and the reason given at paragraph 48 is that it was because of the combination of the fact that the head injury was not part of the pleaded claim and the fact that it was minor and short-lived. The facts here are different. Here there is a significant issue, but that was abandoned on receipt of the medical evidence before the issue of proceedings, so that did not feature in the litigation at all as an issue to be determined on the pleadings.

“DDJ Masheder did not deal in any detail with the issue of fundamentality in his judgment. It is unclear from the note why he concluded that the Claimant’s dishonesty was fundamental to the claim. In my judgment, he was wrong to so find. The shoulder injury had no bearing on the claim that was issued, which was a £1,500 claim for 2 weeks of minor injuries. I don’t accept the fraudster’s charter argument put forward. I agree with the advocates that it is a question of fact and degree. There is a floodgates argument the other way. Should the Defendant be encouraged to litigate the detail of every issue litigated pre-proceedings in the hopes of a fundamental dishonesty finding where it is not subsequently litigated? The answer must be “no”. Here the Claimant must have been found to be dishonest regarding the shoulder and neck, but when the medical evidence didn’t support it he abandoned it. It did not go to any issue pleaded in the claim. It did not go to the root  of the claim that the Claimant brought. I find that it was not fundamental to the claim and DDJ Masheder was wrong to find that it was.
“I allow the appeal on Ground 2 and substitute the usual QOWCS order for the cost order made by the DDJ.”