Cedik v European Metal Recycling – When is a collateral lie not collateral?17 October 2017
Manchester County Court 6th Oct 2017 (Judgement delivered 10th Oct 2017)
The Claimant brought a claim for personal injury arising from an accident at work on 26/04/12 when the crane he was working in began to shake violently, causing the Claimant to bang his head on the window and injuring his left shoulder. Liability was conceded pre-litigation.
It was accepted that the Claimant suffered an injury to his left shoulder caused by the index accident. However, the medical position was complicated. The Claimant was predisposed to venous thoracic outlet syndrome due to his muscular physique (having been an ice hockey player). The Claimant underwent a rib resection surgery in November 2014.
However, following the surgery the Claimant did not recover as expected and continued to complain of pain and restriction such that he could not work and was more or less housebound.
Unsurprisingly the Claimant had been placed under periods of surveillance. These, whilst showing the Claimant carrying moderately heavy items and moving fluidly, did not capture the Claimant undertaking heavy manual activity or working.
On 23/04/15 the Claimant issued a claim on the basis that he had not worked since the accident and was unlikely to be able to return to heavy manual work in the future.
The Defendants medical expert was of the view that the Claimant’s ongoing symptoms could only be medically explained by residual stenosis of the left subclavian vein. The opinion of an Interventional Radiologist was obtained which concluded there was no such residual stenosis.
On 31/01/17 the Claimant signed a schedule of loss asserting that his symptoms would not allow him to engage in full-time employment involving heavy manual work and claiming future loss of earnings in the sum of £140,000. Further, in his witness statement, also signed 31/01/17 he stated that he had “no employment prospects at the present time”.
It was therefore a surprise to the Defendant when two weeks later it received a request for a reference from a Manchester Airport where the Claimant had successfully applied for a role as a baggage handler.
After further specific disclosure it transpired that the application to the airport had been made only 6 days after he signed his witness statement and schedule of loss. Within the application and CV the Claimant claimed he had been working for a company called ‘Frostbite Refrigeration’ since leaving the Defendant’s employ.
The Claimant sought to explain this by admitting that he had lied on the application to Manchester Airport and that he had not, in fact, worked for Frostbite Refrigeration. The Claimant said he was desperate for work and needed to show a 5 year working history in order to satisfy rigorous security requirements for employees. Frostbite Refrigeration confirmed that the Claimant had not worked for them, although it was noted that the owner of that business was a close friend of the Claimant.
The Claimant had named his fiancé on the application as a reference, stating she was a business friend, rather than divulging the true nature of their relationship.
Ultimately the Claimant did not proceed with the role at Manchester Airport. According to him, he felt he would not be able to manage the physical demands of the role.
The Claimant’s position was that, whilst the mistruths on his CV and application form were dishonest, this dishonesty was collateral to his claim. He maintained he was suffering the symptoms complained of and that he remained unable to undertake heavy manual employment.
The Defendant accepted accident related symptoms up to March 2015 (following the rib resection surgery and recovery) but asserted at trial that the claim should be dismissed pursuant to section 57 of the Courts and Criminal Justice Act 2015 as the Claimant had been fundamentally dishonest.
The judge found that the Claimant’s accident related symptoms resolved within a short period of the rib resection surgery, and at least by the end of February 2015.
Regarding the baggage handler application, the judge found that the Claimant must have known, prior to applying, that the role involved heavy manual labour and that he would not have applied if he did not consider himself fit to do the job. Further, in respect of the Claimant not taking up the role, the judge noted that the Claimant had gone to the trouble of ‘creating’ a CV and attending the interview; he had intended to get the job and had the Defendant not intervened he would have started the job.
Regarding the admitted dishonesty within the Manchester Airport application, she found such activity was criminal and was astonished by the Claimant’s behaviour in times of heightened security. Moreover, the attitudes of the Claimant and his fiancé, that their actions were reasonable in order to secure employment was disconcerting; both the Claimant and his fiancé were found to exhibit serious and persistent dishonesty.
The judge did not accept that the Claimant had been suffering restriction since 2015 or that he had believed himself to be suffering such restriction. The claim for loss of earnings was therefore fabricated and this amounted to fundamental dishonesty which went directly to the heart of the claim. On the point of substantial injustice, which the court was obliged to consider the judge acknowledged that the consequences of her finding were significant but that was the purpose of the legislation.
The claim was dismissed in its entirety and the amount which would have been awarded but for dismissal was recorded as £46,160.07. As the Claimant had already received £18,000 in interim payments, these were ordered to be repaid with 21 days. The Claimant was ordered to pay the Defendant’s costs on an indemnity basis, to be assessed if not agreed.
The case was handled by Andrew Steel, Partner, Plexus Law, Manchester in collaboration with the Plexus Law fraud team. Counsel for the Defendant was Matthew Mawdsley of St Johns Buildings.
For further information on this case please contact:
Andrew Steel, Partner
T: 0344 245 1065 | E: email@example.com
Sick Too Quick – Holiday Sickness Successful Defence3 October 2017
It’s good news for insurers and the travel industry that slowly but surely sickness claims are reaching the courts and those without merit are being dismissed.
One recent fast track matter handled by Plexus Law on behalf of a tour operator was dismissed at trial following scrutiny over the medical expert’s written report.
The Claimant alleged food poisoning following a 14 night all-inclusive holiday to Tunisia in October 2013. This claim was not typical of the questionable sickness claims presented to the industry over the last 12-18 months. In this matter, the Claimant had clearly suffered with a gastric illness. Whilst no official report of the sickness was made in resort, the Claimant changed hotels on approximately the 4th day of the holiday. Rightly or wrongly, clearly the Claimant was dissatisfied with the original accommodation.
Within days of the Claimant’s return to the UK a detailed email of complaint was sent to the tour operator. The Claimant also posted a very unfavourable review on Trip Advisor the same day. The Claimant alleged food poisoning and described gastric symptoms which justified 2 days in bed at the start of the holiday. The Claimant cited the first lunch of fish and rice taken at the first hotel as the cause. Symptoms began approximately 5 hours after eating the lunch on the first day of the holiday.
The Claimant’s initial email went on to explain how, following the change of accommodation, confidence in Tunisian hotel hygiene standards resulted in taxis being taken to the local town in order to avoid getting food poisoning for a second time. This inferred that the short bout of sickness had resolved.
At the time of the holiday, the Claimant was on various medications for, amongst other things, asthma, a rheumatological condition and weight loss. The side effects of the medications could cause gastric symptoms. The medications and pre-existing issues meant the Claimant was a fairly regular visitor to the GP. The Claimant had visited the GP 3 weeks before the holiday with diarrhoea. The Claimant visited the GP 5 days after returning from Tunisia. She had a flu jab and there was no mention of the sickness recently suffered on holiday.
Proceedings were issued against the tour operator in October 2016. In the pleadings the sickness had increased to a fairly lengthy 6 weeks. The Claimant’s holiday was ruined as a result of ‘barely leaving the bed for the rest of the holiday’ (the witness statement of the Claimant’s travelling companion).
The Claimant’s medical expert opined that the sickness was an infective gastroenteritis acquired by ingesting food and drink at the first hotel. Part 35 questions were put to the expert and asked the expert to consider the possibility that the sickness was idiopathic traveller’s diarrhoea. The expert maintained his opinion and elaborated that the cause was most probably a strain of E-Coli. The medical expert did not consider the incubation periods required for the various possible pathogens; E-Coli in particular has a typical incubation period of 3-4 days. The expert did not consider the breakfast consumed at home or the inflight meal earlier that same day. The expert’s report was therefore unable to persuade the judge that the first meal eaten at the first hotel was the most probable cause of the symptoms which began just 5 hours later. Put simply, the Claimant was sick too quick. The judge accepted that the Claimant was reasonable in believing that this meal was the cause and further accepted that the apparent exaggeration as to the length of the sickness and effect on the holiday was simply a cloudy memory due to the passage of time.
The abundance of hygiene documentation, lack of sickness outbreak at the hotel and willingness of the head chef to give evidence by way of video link from Tunisia is likely to have assisted the judge in reaching this conclusion.
The claim was dismissed at the trial on 21 September 2017 and costs were awarded to the Defendant. As qualified one-way costs shifting applies, the Defendant is however unable to enforce the costs order.
For further information on this case please contact:
Claire Scargill, Solicitor
T: 0344 245 5330 | E: firstname.lastname@example.org
A Cocktail of Toxic Ingredients – Interpretation of CPR 44.15 (c)/exception to QUOCS3 October 2017
Derby County Court has recently provided a useful judgment regarding the interpretation of CPR 44.15 (c). The rule provides an exception to qualified one-way costs shifting (QUOCS) following a strike out of a Claimant’s statement of case as a result of the Claimant’s conduct obstructing the just disposal of the proceedings.
It was previously unclear what type of conduct and obstruction would implement the exception. It was open to interpretation and likely to be fact specific to a particular strike out.
This matter arises from a foreign holiday taken by the Claimant and two other holidaymakers on 20 August 2012 for 7 nights. The Claimant made a number of bookings over the telephone with the Defendant which included return flights from East Midlands airport to Corfu, 7 night’s all-inclusive accommodation at the Corfu Sea Gardens and airport transfers.
During the stay at the Corfu Sea Gardens the Claimant alleges that she became ill as a result of poor hygiene standards at the hotel. The Claimant issued proceedings against the Defendant pursuant to the Package Travel, Package Holiday and Package Tours Regulations 1992 (PTR) alleging that the Defendant supplied a package holiday and was therefore vicariously liable, pursuant to the PTR, for the acts and/or omissions of the suppliers who performed the obligations under the travel contract. The proceedings were issued on 6 September 2015 and served upon the Defendant’s solicitors, on 12 December 2015. It appeared that the matter was issued outside of limitation however, the papers were brought to the court on time. Perhaps an early indication as to how this matter was to be run; by a Claimant who eventually exhausted all bites of the cherry.
The Defendant’s defence was twofold. Firstly, the Defendant denied that a package holiday was supplied and therefore denied that they were vicariously liable for the acts and/or omissions of the hotel. Secondly, in the event that the Defendant should fail on the first point, the Defendant denied that the hotel’s hygiene standards were poor. The defence was filed and served in February 2016. Directions were set and the trial was listed for 20 September 2016.
Standard disclosure by list was due by 4pm on 25 May 2016. The Defendant received the Claimant’s unsigned list late on 31 May 2016 followed by a signed list on 6 June 2016. On 2 June 2016 the Defendant requested to inspect 2 items from the list (various holiday photographs and GP Records). The Claimant was obliged to comply with this request within 7 days; by 9 June 2016.
The parties were due to exchange lay witness evidence by 4pm on 6 July 2016. By 18 July 2016, the Defendant was still not in receipt of the requested documents or the Claimant’s witness statements and so put the Claimant on notice that an application for strike out would be made within 7 days.
The application was filed and the application hearing was listed for 16 August 2016. In response to the application the Claimant made an application for relief from sanction, thereby accepting the breaches. The court made an Unless Order which provided the Claimant with a deadline of 4pm on 19 August 2016 to comply with the directions Order; namely that the requested documents (photographs and GP records) be disclosed, witness statements served, and also for the updated schedule of special damages now due to also be served. Failure to comply would result in the matter being struck out.
On 18 August 2016 the Claimant disclosed, via email, GP records and 2 witness statements. No photographs or updated schedule of special damages was received and the matter duly stood as struck out. The court made an Order confirming the strike out on 5 September 2016. The court also awarded the Defendant’s costs of the action to be assessed.
The Claimant applied to set aside the Order on the basis that there was no updated schedule of special damages to serve and the requested photographs were emailed to the Defendant in June 2016. The Claimant submitted that the Unless Order had therefore not been breached. The Defendant denied ever receiving the email, in June 2016 or at all, and assumes the Claimant must have received a failure notification.
Why the Claimant had not previously alerted either the Defendant or the court to this June 2016 email, for example at the hearing on 16 August 2016 or in response to the Unless Order, remains to be seen. The production of the photographs went to the very heart of the strike out and the opposing solicitor’s had emailed on several occasions on the subject and reference to the photographs being emailed in June 2016 was never made. On the contrary, the Claimant seemed to previously accept that there had been a breach in failing to disclose the photographs and a September email from the Claimant’s solicitor to the Defendant’s solicitor confirmed they were taking their client’s instructions on the photographs. These positions make little sense if the Claimant believed they had in fact already disclosed the photographs two/three months previously.
At a November 2016 hearing of the Claimant’s application to set aside the Order, the judge was critical of the Claimant only recently referring to the June 2016 email. Serving an additional witness statement, to flesh out the ‘good reason’ limb of the Denton test, on the Defendant’s counsel on the morning of the hearing was also unlikely to gain the judge’s favour. The judge looked at the matter in the round and concluded that the case consisted of ‘a cocktail of toxic ingredients’. The judge dismissed the Claimant’s application and the matter remained struck out.
The judge was not minded to make a finding on CPR 44.15 (c) on whether QUOCS was excluded and preferred to review case law and guidance in this area.
The Claimant submitted that a strike out following a breach of an Order did not satisfy 44.15 (c) and the requirement for conduct to wholly obstruct the just disposal of the proceedings. The parties had to wait until September 2017 for the issue to be heard.
The judge in September 2017 agreed that several breaches of an Order and a breach of an Unless Order was sufficient to satisfy CPR 44.15 (c) and the Defendant was awarded costs of £13,399.50 in an enforceable costs Order. It is worth noting that a strike out following just one single breach of an Order may not be sufficient to exclude QUOCS and for CPR 44.15 (c) to come into play.
For further information on this case please contact:
Claire Scargill, Solicitor
T: 0344 245 5330 | E: email@example.com
Summary Judgment: One of the most powerful tools in a Defendant’s armoury31 July 2017
Plexus was recently instructed to act for a company which had proceedings issued against it. The Claimants (“C”) contended that the Second Defendant (“D2”) had failed to unblock some drains on the neighbouring land, with the consequence that the C’s land flooded. D2 was a contractor engaged from time to time by D1.
The claim against D2 was only framed in negligence. Despite a robust Defence and part 18 questions, little if anything was provided by way of clarification as to the basis for the claim or the basis on which D2 was said to owe a duty of care to C.
From the outset and as pleaded in the Defence D2 contended that they did not have a liability in negligence to C. It was submitted that on any analysis no such duty of care was owed, and therefore the claim must fail and should be struck out before further unnecessary costs were incurred.
Plexus took the bold step and on agreement of the client to apply for Summary Judgment.
Summary Judgment is one of the highest civil thresholds. CPR 24.2 provides as follows:
“The Court may give summary judgment against a claimant or defendant on the whole of a claim or on a particular issue if –
(a) it considers that –
(i) that claimant has no real prospect of succeeding on the claim or issue; or
(ii) that Defendant has no real prospect of successfully defending the claim or issue; and
(b) there is no other compelling reason why the case or issue should be disposed of at a trial”.
Plexus argued that the Claimants’ claim had no prospects of success. The Claimants argued that negligence was not proven against the Second Defendant.
The House of Lords in Caparo Industries plc v Dickman  2 A.C. 605, held that in order to establish a duty of care the Claimants needed to satisfy the court of 3 things:
- Damage was foreseeable
- That C and D2 had a relationship of sufficient proximity or neighbourhood; and
- That it is fair and reasonable, taking into account policy concerns, that a duty of care should be recognised in all the circumstances of the case
Consideration of proximity requires isolation of factors that indicate that D’s act or omission closely and directly affected C and that the parties are, in a sense, neighbours. The taking on or assuming responsibility for a task can give rise to a duty of care to third parties in certain circumstances.
It is a trite observation to make that in order for any such claim to stand any real chance of success it must, as a first pre-requisite, be shown that D2 owed a duty of care to C.
Plexus argued that D2 was not C’s physical neighbour nor was there sufficient proximity and for the purposes of the Caparo v Dickman analysis:
- There was no contractual relationship
- D2 did not own the land on which works were to be carried out
- D2 had not assumed any responsibility to C
- D2 had assumed no responsibility to undertake any works. All that had happened was that works had been recommended and priced and authorisation from D1 to carry them out was outstanding
- D2, even if it thought that works ought to have been done, had no right or necessary access to go onto the land or power to do anything
- There were no policy considerations which would allow a finding that it would be just and reasonable to impose a duty of care on D2 in the circumstances of this case. To do so would open floodgates to claims against innocent contractors who had assumed no responsibility and were powerless to act
Finding of the Court
The Court found that there was no real prospect of success in the claim against D2 and summary judgment was entered in favour of D2 with costs in full.
Plexus Law recovered their costs from the Claimants and it was therefore at no cost to D2. The Claimant paid a high price for litigating a claim without properly analysing the merits of the claim beforehand, and in the face of warnings from Plexus Law.
If you would like further information of this case please speak to your contact at Plexus:
Edward Musa, Solicitor
Property Risks & Coverage
T: 0344 334 1057
City Tower | Piccadilly Plaza | Manchester | M1 4BT
Plexus Law wins Court of Appeal Decision19 July 2017
Late Acceptance of Part 36 Offer; costs consequences; successful Appeal of costs order made in Claimant’s favour which order allowed a departure from the usual adverse costs consequences of CPR Part 36
CA (Civ Div) (Gross LJ, Asplin, J) 13th July 2017
Whilst working for the Defendant in January 2010, the Claimant had injured his foot in the workplace. Proceedings were issued in January 2012 with an unfavourable prognosis for the injury sustained by the Claimant provided by his orthopaedic surgeon.
The Defendant made a Part 36 offer in September 2012 to settle the entirety of the claim in the sum of £50k; the 21 day period for acceptance expired on 9th Oct 2012. No acceptance/rejection response was received from the Claimant.
The Claimant was granted a stay of proceedings and had foot surgery in May 2013. In April 2014, the stay was lifted at which point the Claimant increased his claim for damages to £248k. The Claimant also produced a new report from a new orthopaedic surgeon and although the prognosis was ‘slightly better’, overall it remained unfavourable.
Following disclosure of the Defendant’s surveillance evidence, in the parties’ orthopaedic experts’ joint statement, the Claimant’s expert altered his opinion such that it was more in line with the opinion of the Defendant’s orthopaedic expert, importantly it was concluded that the Claimant would be able to work until retirement age. The joint statement had the effect of undermining the Claimant’s case.
A trial was fixed for early 2015 however, in advance of this date (February 2015) the Claimant applied to vacate the trial and on 2nd June 2015 accepted the Part 36 Offer originally made in September 2012. He then successfully applied under CPR r.36.13(5) to alter the usual consequences of CPR Part 36, and at first instance the Defendant was ordered to pay his costs up until 30th Oct 2014. The Judge accepted that as the prognosis had been uncertain until the October 2014 orthopaedic experts’ joint statement, it would be unjust to apply the usual 21-day acceptance period, following which, under normal circumstances, the Claimant would have been responsible for the Defendant’s costs.
Basis of Appeal
The Defendant appealed the decision of the District Judge at first instance on the basis that the judge’s interpretation of the ‘concept of injustice’ had been wrong. And under CPR r.36.13(6) and CPR r.36.17(5) it was not unjust in all the circumstances of the case for the Claimant to pay the Defendant’s costs from 21 days after the Defendant’s September 2012 Part 36 offer.
Court of Appeal – Decision
The appeal was allowed. The Court of Appeal found:
- It was important not to undermine the salutary purpose of CPR Part 36 but at the same time the court should not conduct a microscopic examination of the case.
- Cases are fact specific and the general rule of Part 36 was that if the Claimant did not accept the Defendant’s Part 36 offer within the 21 days then they would be liable for the Defendant’s costs thereafter.
- On late acceptance of a Part 36 offer the court must, unless it considers it unjust to do so, order the Claimant to pay the Defendant’s costs from expiry of the relevant period, and it is for the Claimant to demonstrate the injustice.
- SA (A Child) v Hewitt (Costs)  EWCA Civ 1053 – brain damage to a child which resulted in difficulties in experts’ achieving a clear prognosis had applied the same principles but to a different end.
- Whilst not suggesting the Claimant’s injuries had been exaggerated, the overall process and timescales regarding the litigation provided some cause for concern – in effect, there was no discernible reason to distinguish this case from any other involving the usual risks of litigation.
- Questions were raised as to the point at which the Claimant opted to accept the original Part 36 offer, as this could not be reconciled with either the second medical report or the subsequent experts’ joint statement, which itself undermined the Claimant’s claim for the increased sum of £248k.
- The stay may have been relevant had it promptly followed the Part 36 offer but in reality there had been a significant time lapse.
- Even without a finding of exaggeration by the Claimant, the amount of the claim had been greatly increased following the stay.
- While always hesitating in overturning a decision on costs, the District Judge had erred in that he did not give proper effect to CPR Part 36 by properly identifying injustice. SG followed.
One of the main purposes of Part 36 offers is to transfer the risk from the Defendant to the Claimant, in the event that an offer is not accepted.
Uncertainty regarding the Claimant’s prognosis is part of the usual risk of litigation, it is not enough to show that it was difficult to form a view on how the litigation would go.
The District Judge had been wrong to not make the usual costs order following late acceptance where there was no clear and identifiable injustice.
Civil Procedure – Costs (LTL) – CPR (LTL)
Costs order: CPR – Part 36 Offers – Personal Injury Claims – Stay of Proceedings – Civil Procedure Rules 1988 r.36.133(5), r.36.13 (6) and r.36.17(5)
For the Defendant: Mr Michael Jones of Cobden House Chambers instructed by Louise Shaw, Partner, Plexus Law.
If you would like any further information on this case please contact:
Louise Shaw, Partner
Plexus Law, City Tower, Piccadilly Plaza, Manchester, M1 4BT
T: 0344 334 1009 | M: 07584 344 629 | E: firstname.lastname@example.org
Cameron v Hussain25 May 2017
Bianca Cameron (Claimant/Appellant) v Naveed Hussain (First Defendant) and Liverpool Victoria Insurance Co Ltd (Second Defendant/Respondent)
The claim arises from a road traffic accident on 26 May 2013. There was a collision between the claimant, Miss Bianca Cameron and another motorist, driving a Nissan Micra. The driver of the Nissan failed to stop but the registration number was noted by a witness. The Claimant suffered personal injuries and vehicle related losses including credit hire estimated at between £10,000 to £15,000.
The First Defendant was identified as the owner of the vehicle but failed to cooperate with the police to identify the driver. The Second Defendants were the motor insurers for the vehicle but it transpired the policy had been obtained fraudulently in a different name to the First Defendant.
It became clear the First Defendant was not the driver of the vehicle so the Claimant applied to substitute the First Defendant to an unknown person identified as:
‘The person unknown driving vehicle registration number Y598 SPS who collided with vehicle registration number KG03 ZIZ on 26 May 2013’.
The lower courts dismissed the application and the first appeal and the matter progressed to the Court of Appeal.
The Issues The main issues were whether the Claimant could sue and obtain judgment against an unknown person and whether an insurer would be liable under s151 RTA 1988 to satisfy any such judgment.
The Court of Appeal after consideration of the previous case law and CPR granted the Claimant’s appeal and permission to substitute the First Defendant to an unknown person.
- Claimants involved in accidents with unknown drivers, where the insurers are identified, are unlikely to pursue a claim under the MIB Untraced Driver’s Agreement and instead pursue court proceedings. Claims under the Untraced Driver’s Agreement have limited recoverability for damages and costs
- Insurers in such circumstances will have limited recourse to recover any monies paid out unless they are to pursue their own policyholder for breach of policy conditions
- Insurers will need to consider more carefully the need to obtain s152 declaration proceedings thus avoiding their s151 liability
- Where s152 declaration is not an option insurers will need to ensure they are added as party to any proceedings at the outset to enable submissions to be made
- Insurers will need to consider whether more detailed investigations/questions are required before putting policies in place
It remains to be seen whether LV will appeal to the Supreme Court.
For further information on this case please contact: Anthony Baker, Partner on T: 0344 245 4202 or E: email@example.com