Peter Harthan

Barrister

Road Traffic

Fundamental Dishonesty and a dodgy Caribbean footie match

Most football fans are familiar with the story of Barbados v Grenada in Caribbean Cup Qualification 1994. Tournament organisers decided that they didn’t want any drawn games and so extra time, then penalties if necessary, would decide a winner. As was fashionable at the time, the so-called “golden goal” rule applied such that the first goal in extra time would win the match and end the game. On the basis that a “golden goal” would deprive the scoring team of the remainder of extra time to improve their goal difference, the organisers decided that a golden goal would count as 2 goals.

In the final group game Barbados needed to beat Grenada by 2 clear goals to go through at Grenada’s expense. With a few minutes left, Barbados were winning 2-1, a result that would send Grenada through. Barbados realised that their best chance of success would be to score an own goal, which they duly did, and send the game into extra time when a ‘golden goal’ would send them through. Barbados having scored an intentional og to make it 2-2, Grenada realised that their best strategy was to score an own goal to lose by 1 in normal time, a result which would see them qualify. The last few minutes of the game then descended into farce with the Barbados players defending the Grenada goal against the Grenadian players trying to score a deliberate own goal.

On one level it is simply a humourous story of farce. It is also, however, an extreme demonstration of how changing the rules of a game changes the strategies and behaviours of the teams. Before changing the rules a wise planner will assess how the rule change might impact on optimal strategies and behaviour.

Practitioners of Personal Injury Law are now very familiar with the concept of Fundamental Dishonesty. A finding of Fundamental Dishonesty pursuant to r44.16(1) removes the protection of Qualified One Way Costs Shifting and renders a costs order in the Defendant’s favour enforceable to its full extent.

Defendants now have an eye on a finding of fundamental dishonesty and there is no doubt in my mind that litigation strategies have shifted dramatically. Prior to the changes factual disputes, particularly in road traffic cases and accidents at work, were almost always fought on the basis of ‘honest but mistaken recollection’ rather than dishonesty. The sensible assumption was that it was easier to persuade a Judge to find a witness to be mistaken rather than dishonest. Since there was no particular advantage in proving dishonesty, indeed often quite the reverse as an ATE Insurer might not pay out for a dishonest Claimant, the wise litigator raised dishonesty only when absolutely necessary.

This approach has changed. Certainly fraud and ‘quasi-fraud’ such as Low Velocity Impact cases are likely to result in an application for a finding of FD from a successful Defendant. However less obvious routes might become apparent at very late stages of the litigation. For example a Claimant with a Medical Report supportive of a 12 month prognosis but who confirms in oral evidence that they recovered in a few months, a Claimant who relies on an estimate for vehicle repairs but then confirms in oral evidence that they got their vehicle repaired at a local garage for far less than the estimate prepared by their Insurer’s engineer. Whereas in the past a failure to prove a particular head of special damage, say Loss of Earnings, might be described no higher than an evidential failure, such a failure is now likely to lead to an application for an FD finding if the loss is a significant element of the claim. Mistakes in the recollection of an accident, particularly when they are significant and starkly contrast with the evidence of the Defendant, are unlikely to be accepted as innocent errors of memory and may well found the basis for an FD application.

Claimant Solicitors must ensure that they have properly advised their clients of the risk of a finding of FD and the consequences thereof. Whilst there may be some commercial reluctance to do so - one doesn’t want to put off good clients when the perceived risks of a finding of FD are low - I am coming across clients on a regular basis in conference who have not been told of the potential risk to them should there be a finding of FD. Clients should always be advised as to the worst case scenario as well as the best. Further, given that FD need not be expressly pleaded (albeit a wise Defendant will do so when appropriate) it can raise its head unexpectedly in the course of the litigation.

Secondly, the maxim of ‘If you don’t ask, you don’t get’ in relation to Schedules of Loss is over. If you ask without good grounds then you are leaving the client open to an allegation of exaggeration and FD.

Thirdly, ensure that detailed instructions are taken from the client, on quantum as well as liability. Find out if recovery has been in line with the Medical Report. If it has not, then set out clearly in the witness statement how it has differed. If some items of damage are estimated future loss at the time of drawing up the Schedule of Loss then ensure that you have checked whether these items have crystallised by the time of taking a witness statement and if so in what amount.

Nobody should have any sympathy for dishonest persons who seek to use the Courts to recover moneys to which they have no entitlement. They deserve what they have coming to them. However those who advise Claimants need to make sure they are not putting honest clients in avoidable jeopardy by failing to keep a proper eye on any potential for FD.

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