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Darren Lewis

Darren Lewis, a member of our Personal Injury team, provides an insightful analysis of the recent High Court case of Woodger v Hallas [2022] EWHC 1561 (QB), a Substantial Injustice in S57 Criminal Justice and Courts Act 2015 dishonesty case.

The Appeal was heard by Mr Justice Knowles, who heard London Organising Committee of the Olympic And Paralympic Games (LOCOG) v Sinfield [2018] EWHC 51 (QB) the first High Court Appeal on S57 of the Criminal Justice and Courts Act 2015. He was therefore treading familiar ground. The Court declined to give a clear test or red line on substantial injustice.

Facts

  • The claimant was a front seat passenger in a car driven by the defendant. There was a serious road traffic accident for which liability was admitted. There was no doubt the claimant suffered serious injury. He complained of ongoing problems including significantly reduced mobility and an inability to carry out his pre accident work on motor cars.
  • The defendant commissioned surveillance, which clearly demonstrated the claimant moving without difficulty and working on motor vehicles – on some occasions for lengthy periods. A witness had given a statement to the claimant’s solicitor but declined to sign it because it was not true that the claimant was not being paid for his work. The witness was called by the defendant and cross-examined. He confirmed the claimant worked cash-in-hand jobs and was paid sums amounting to £12,000 per annum.
  • The experts agreed that the video showed a claimant in a far better condition than had been presented to them.
  • The Schedule of Loss was maintained in full up to the surveillance evidence and (amongst other things) advanced Future Loss of Earnings claims of £481,000 until retirement, future care of £15,000 and future DIY of £26,000.

First Instance

  • HHJ Godsmark QC found for the claimant. He awarded £49,415 in damages (out of £74,460 damages that were still pursued at trial).
  • He found the claimant had concealed earnings which had made up the bulk of his claim. He found there was fundamental dishonesty. He found however that there were other elements of the claim “uncontaminated” by the dishonesty.
  • He found the claimant would suffer substantial injustice if he dismissed the claim on the basis that:
  1. There were elements of the damages “uncontaminated” by the dishonesty.
  2. The injuries had had a serious impact and were ongoing.
  3. There was a care claim pursued on behalf of innocent parties “who selflessly gave their time, care and generosity.”
  • He dismissed the heads of damages that were related to the earnings which had been claimed dishonesty.

Appeal

  • In the Appeal Mr Justice Knowles provided a useful summary of fundamental dishonesty and S57 case law. Darren would recommend that insurers, solicitors and barristers add it to their case law collection as a very useful touchstone in fundamental dishonesty.
  • The Court reiterated that praying in aid the loss of honest damages alone is not “substantial injustice”. The nature of S57 means there will nearly always be honest damages and their loss is a policy decision made by Parliament.
  • He cited with approval HHJ Sephton QC in the High Court case of Iddon v Warner [2021] Lexis Citation 39, [97]-[98] where it was found the loss of private treatment and therapy costs for a dishonest claimant (who could not afford to meet the costs themselves) was not a substantial injustice. Nor was it substantial injustice to dismiss the claim where  the claimant used an interim payment to buy a house which would have to be sold to repay the sum.
  • Mr Justice Knowles appeared to endorse (paras 47 & 48) the balancing exercise seen in Iddon (at para 103). There the Court balanced the nature and extent of the dishonesty against the injustice of dismissing the whole claim.
  • The loss of a gratuitous care claim made on behalf of innocent parties did not cross the Substantial Injustice threshold either.

Conclusion and comment

  • Mr Justice Knowles reiterated his earlier comments in Sinfield that he would not set out a test or a prescriptive list of what was and what was not substantial injustice, and that it was something First Instance Judges “know it when they see it”. As of June 2022 substantial injustice remains something few have seen and fewer claimants have sustained on Appeal. This is good news for defendants/insurers and remains a serious deterrent for claimants.
  • The apparent endorsement of the balancing exercise in Iddon at least provides useful guidance for practitioners and judges as to how we present and ventilate the issues should a substantial injustice argument arise.
  • You can read the judgment here.