EWCA Civ 851
Court of Appeal considers the test for giving permission to bring committal proceedings for false statement of truth in personal injury claim
The claimant brought a noise-induced hearing loss ("NIHL") claim against his former employer. The employer's insurer commissioned an intelligence report which, it alleged, showed that the claimant had signed a false statement of truth. The claimant discontinued his claim and the insurer applied for permission to bring contempt proceedings. Permission was refused and the Court of Appeal has now allowed the appeal from that decision.
The test for granting permission in these circumstances is not whether a contempt has, in fact, been committed but whether it is in the public interest for proceedings to be brought (and this includes a consideration of proportionality). The judge at first instance had erred in two respects when considering whether to exercise his discretion to grant permission:
(a) He had taken into account the absence of warning given to the claimant. Although this can be a relevant factor, it is not necessarily a factor in all cases. In this case, the allegedly false statement of truth was provided early on and the insurers at that stage could not reasonably have been expected to give a warning about contempt. By the time they had carried out their investigations "the die was already cast". As the Court of Appeal put it: "it is difficult to conceive of circumstances where a claimant can be heard to say that he was prejudiced by the absence of warning about the risks of contempt proceedings if he, himself, has been responsible for bringing a fraudulent claim".
(b) He had taken into account the claimant's immediate discontinuance of the proceedings. Again, this can be a relevant factor but the judge failed to have regard to the "very real mischief that the stratagem of early discontinuance represents in this arena as one of the tactics of unscrupulous claimants and lawyers who engage in the practice of low-value wide-scale insurance fraud, particularly in the field of e.g. NIHL claims".
The judge had also erred in finding that the committal proceedings would not be proportionate. Furthermore, the argument raised by the claimant that he was unaware of what was being said or written by his then solicitors was something to be raised at the committal hearing later on.