Ghanem v Independent Reworks Limited

Birmingham County Court – 14.01.2016

DJ Lumb

A Defendant successfully applied to strike out a suspected fraudulent road traffic accident claim as a result of the Claimant’s failure to exchange witness evidence, after the Defendant had served evidence recorded on a “dash-cam”. The Claimant pursued a claim for injury and credit hire under the QOCS regime, but QOCS protection was lost after the court concluded that the Claimant’s conduct interfered with the just disposal of the case.

Senior Para-legal, Laura East looks at her case of Ghanem v Independent Reworks Limited where the Defendant sought an order pursuant to CPR r.44.15 which would see the insurers recover their wasted costs of defending the action. The judgement provides some helpful guidance on what conduct a court might consider sufficient to dis-apply QOCS.

Background

DWF LLP were instructed to defend claims brought against the Defendant in relation to a road traffic accident which occurred in October 2012.  The Claimant alleged that they were travelling behind another vehicle, which made a sudden right turn causing him to brake and slow down.  It was pleaded that the Defendant had failed to brake and negligently collided with the rear of his vehicle. 

The Claimant, one of four occupants in a Vauxhall Corsa, issued proceedings for a whiplash injury, vehicle damage and over £8,000 in credit hire charges.  The other occupants also intimated claims for injury which remained in the background pending the outcome of the lead claim.

The Defendant’s vehicle was fitted with a “dash-cam” which was in use at the time of the accident and recorded the incident. The recording shows the Defendant travelling behind the Corsa and another vehicle travelling extremely close together.  As the lead vehicle peels off on to a slip road to the right, the Claimant slams on his brakes bringing the vehicle to a complete stop in the road.  The Defendant is unable to stop and collides with the rear of the Claimant’s vehicle. Although the Defendant made the footage available to the Claimant pre-litigation, proceedings were later served. 

Facts

Proceedings were issued on 1 July 2014 and a defence was filed. Directions were then agreed by the parties and, soon after directions were ordered by the court the Claimant’s solicitors applied to be removed from the court record as acting for the Claimant.  The application suggested that they no longer held instructions to act for the Claimant, despite only having issued proceedings on his behalf a few months before.  The court approved the solicitors’ request and the action continued in the absence of a notice of discontinuance

The Claimant having failed to exchange witness evidence, the Defendant then made an application to strike out the claim and for an order that the Claimant meet the Defendant’s costs and that QOCS be suspended under CPR r.44.15, enabling the Defendant to enforce their costs against the Claimant.

Defendant’s Application

Upon hearing the Defendant’s application, District Judge Lumb, sitting in the Birmingham County Court on 14 January 2016, indicated that he had no issue in striking out the claim in light of the Claimant’s clear failure to comply with the directions and despite the Defendant’s solicitors best efforts to make contact with the Claimant. 

The Judge indicated that he was concerned by the Defendant’s request for an order to enforce their costs of defending the action against the Claimant under CPR r.44.15.  The Claimant was entitled to protection under the QOCS rules. The Judge stated that there was no authority that he was aware of that defined what was meant by ‘conduct...likely to obstruct the just disposal of proceedings’ and that it did not seem at first blush that the Claimant’s failure to pursue the claim amounted to conduct that fell within the ambit of r.44.15.

Representing the Defendant, DWF’s Nick Truelove pointed out that there was in fact no binding authority that shed light as to how the rule should be interpreted. It was submitted that a plain reading of that provision should be taken and that the Claimant’s failure to discontinue his claim, or actively pursue it obstructed the just disposal of the case, as it had necessitated the wasting of court time. The Defendant had had to bring the application, or there was a danger that the parties would have proceeded to a trial, at which the Claimant would not have been able to rely upon and evidence.

Alternatively, it was argued that the court should interpret r.44.15 (1)(c) as being meant to mirror r.3.4 (2)(c) in the way r.44.15 (1)(a) and (b) mirror r.3.4 (2)(a) and (b) of the CPR. This interpretation would mean that behaviour likely to ‘obstruct the just disposal’ would include any failure to comply with the rules and/or the Court’s directions and which might have led to the case being struck out.

Finally it was submitted that r.44.15 (1)(c) should be interpreted as another basis upon which the court can strike out the claim, the commentary in the CPR following r.3.4 confirming that the inherent power to strike out a case goes beyond those circumstances delineated under r.3.4. The court could recognise the Claimant’s conduct in wasting precious court time as warranting strike out pursuant to r.44.15 (1)(c) with the correlative cost consequences.

Having heard the Defendant’s submissions, District Judge Lumb gave judgment, wherein he stated that he agreed that r.44.15 (1)(c) had to be interpreted as a mirror of r.3.4 (2)(c) and that, in any event the common sense understanding of the Claimant’s failure to comply with directions has meant that the Court has listed a one day trial for a case where the Claimant has no evidence to rely upon. The Claimant’s conduct was likely to obstruct the just disposal of proceedings.

As a result of those conclusions the following order was made:

  1. The Claimant’s claim stands struck out.
  2. The Claimant shall pay the Defendant’s costs pursuant to CPR r.44.15 (1)(c) summarily assessed at £6,000.

Comment

Although QOCS will soon have been with us for three years, the law is still developing around when QOCS protection should be lost. There have been a number of reported cases where the protection afforded under QOCS has been lost as a result of fundamental dishonesty, under CPR r.44.16, but there have been fewer cases reported where QOCS has been lost under CPR r.44.15 and none of the authorities reported thus far are binding.

The Defendant’s approach in this case was to urge the Judge to conclude that the rules around suspending QOCS should be read in conjunction with the Court’s inherent jurisdiction to strike out a claim under CPR r.3.4. The decision of DJ Lumb will provide some useful guidance in other cases, particularly those cases where fraud has not been pleaded and so a finding of fundamental dishonesty might not be reached.

As a result of the Defendant capturing the incident on his dash-cam, his insurers were provided with good evidence that the claim was likely to be fraudulent and this case highlights that this type of technology can play a key part in defeating claims. Having disclosed the footage, the Defendant was able to confidently deny the claim and defend the proceedings.

Had the events had not been captured, then the Defendant would have been faced by a Claimant who was intent on commencing proceedings and who would have no doubt been supported by the three other occupants, all of whom had made claims.

In the circumstances, the Defendant’s insurers were able to defend claims that would have been worth around a total of £60,000.