Judge entitled to dismiss claim in absence of finding of fraud

The Court of Appeal has confirmed that although the trial judge had been incorrect to find that a road traffic accident had been fraudulent, he did not have to make a positive finding of fraud in order to dismiss the claim.

In the case of (1) Mohamed Rizan (2) Mohammed Rilshad -v- (1) Barry Hayes (2) Allianz Insurance plc [2016] EWCA Civ 481, the Claimants presented a claim that the First Defendant had negligently driven his van out of a side road, into the side of their vehicle. Claims were pursued in relation to soft tissue injuries, vehicle damage, and vehicle hire.

The First Defendant did not take part in the trial, but the claim was defended by the Second Defendant, the insurer of his vehicle.

The Second Defendant alleged that either:

  • the accident had been a staged collision, in which the First Defendant was complicit; or
  • the Claimants had deliberately brought their vehicle to a sudden stop in front of the First Defendant’s van, so as to cause the collision.

Whilst the Claimants initially alleged that they had been travelling at circa 30 – 40 mph at the time of the impact, accident reconstruction experts agreed that the impact damage was not consistent with a collision whilst the Claimants’ vehicle was moving.

The First Claimant subsequently altered his account to suggest that whilst he had been travelling at 30 – 40 mph pre-impact, he had braked on seeing the Defendant’s vehicle, and had come to a standstill at the time of impact.

The Second Claimant maintained that their vehicle was still moving at the time of impact. The trial judge noted, however, that he had little confidence in the Second Claimant’s evidence; the Second Claimant had been involved in ten motor collisions between August 2007 and March 2011 which he had avoided disclosing, when questioned.

The Second Defendant adduced evidence from an enquiry agent who had interviewed the First Defendant, but the judge found that – due to a number of inconsistencies in the First Defendant’s account – he could place little faith in his evidence.

The trial judge found that he could not be satisfied with the Claimants’ alleged account of the accident; accordingly the claim was failed. At the end of his judgment, the trial judge also commented that, if it were necessary for him to do so (which he did not consider to be the case) he would have found that the claim was fraudulent. No reasoning was given for this finding.

The claim was therefore dismissed, and the Claimants were ordered to pay costs on the indemnity basis.

The Claimants appealed the decision, submitting that the finding of fraud could not be supported. In addition, it was averred that in the absence of a finding of fraud, the evidence supported the fact that the collision occurred when the First Defendant pulled out from a minor road into a major road on which the Claimants were travelling. Accordingly, the conclusion that, on the balance of probabilities, the accident occurred as a result of the negligence of the First Defendant was the only conclusion that could properly have been reached.

The Court of Appeal accepted that the trial judge had been unwise in expressing a view on whether the claim was fraudulent. His initial view that the Claimants had failed to establish their case on the balance of probabilities was correct; it was not necessary for him to go further to address the question of fraud.

Tomlinson LJ commented that, in the absence of the enunciation of any reasons for trial judge’s conclusion that the claim had been fraudulent, that finding would be set aside.

However the dismissal of the claim was upheld. The only evidence as to the accident circumstances came from the Claimants themselves. Their account was inconsistent with the agreed conclusions of the accident reconstruction experts, who had accepted that the Claimants’ vehicle had been stationary at the time of impact. Accordingly, the Claimants had failed to establish, on the balance of probabilities, that the accident had occurred as alleged.

The order that the Second Defendant’s costs should be assessed on the indemnity basis was set aside and substituted with an order that those costs would instead be assessed on the standard basis.

This decision serves as helpful confirmation that even in the absence of a finding of fraud (which will require strong and cogent evidence to establish), courts will be willing to dismiss claims if satisfied that a claimant’s account of the accident cannot be accepted on the balance of probabilities.

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