Section 57 of the Criminal Justice and Courts Act 2015 came into force on 13 April 2015 and applies to claims issued on or after this date.

Scope

Section 57 introduces a provision which compels courts to dismiss the entire personal injury claim where the claimant has been found to be fundamentally dishonest in relation to a primary or related claim.

The provision extends the judicial power introduced in Summers v Fairclough Homes Ltd beyond the very exceptional circumstances envisaged in the case which allowed for an abusive claim to be struck out at the end of trial. The burden of convincing the court to strike out the claim is also reversed, with a new presumption that the court will exercise its power to dismiss the entire claim.

The concept of related claim makes it clear that it applies to claimants who support the fraudulent claims of others and therefore includes Shah v Ul-Haq style claimants who dishonestly support the bogus occupancy of others.

It is important to remember that this provision only applies to successful claims and accordingly would not apply to an accident that has been found to have been staged for the purposes of financial gain, as such a claim would be dismissed.

The judicial power is only actionable upon the application by the defendant and claimants may still be able to maintain their claim if they suffer a substantial injustice if the claim is dismissed. For example, in the case of a catastrophically injured claimant, who has considerable care and assistance needs (and who would be relying upon local authority care provisions which may be inherently limited) may find that their claim is preserved under this provision. There has been no guidance provided on what the concept of substantial injustice means and therefore satellite litigation seeking to define the parameters of this concept is expected.

It is not clear when courts expect the application by defendants to be made, i.e. whether the issue of fundamental dishonesty has to be pleaded in the defence or merely raised in open correspondence. If the concept is pleaded, it is likely that the claim will be allocated to the multi-track, thereby increasing defendants’ potential costs liability. Of course, there are also likely to be instances where the issue only becomes live during cross- examination at trial, leading to oral applications being made during trial.

Application

There is likely to be a significant bedding in period for these news rules. Courts will need to determine how the concept of fundamental dishonesty is to be defined and the parameters in which it is to be applied, as well as the concept of “substantial injustice” which is likely to take considerable judicial consideration. Lord Kerr of the Supreme Court articulated the problem with the concept of fundamental dishonesty:

“In my opinion, you will know it when you see it, but it is impossible to adequately describe it or to write it down. It is therefore a concept that will only be determined through precedent; in reality by either the Court of Appeal or Supreme Court.”

Some guidance can be taken from the judicial consideration of the QOCS concept of fundamental dishonesty. In Gosling v Screwfix the judge was prepared to find that exaggeration of symptoms that doubled the value of the claim fell within the definition. It may be that a similar interpretation is given to the application of section 57, although it was only costs that was in issue in the case.