Videosurveillance has been a boon to employers and insurers in weeding out fraudulent claims.

One such was at issue in Fairclough Homes Ltd v Summers, [2012] UKSC 26. Evidence obtained by undercover surveillance after a trial which established liability (but which left damages open to assessment) made it plain that the claimant had seriously misrepresented the extent of his ongoing disability as a result of a workplace accident. He had suffered injuries, but proved to have ‘grossly and dishonestly exaggerated’ their longer-term effects. The parties agreed on an assessment of damages, at which point the trial judge rejected the defendant’s motion to strike out the claim as a whole on the grounds of fraud, which the judge doubted he had the power to do under the rules of court. This was upheld by the Court of Appeal (which noted the inapplicability of the special rule of insurance law which will allow a claim to be denied in its entirety where only part of the claim is fraudulent or dishonest).

The UK Supreme Court disagreed that the judge had no power to reject the claim in its entirety; this fell within his inherent jurisdiction and was consistent with the rules. The circumstances in which this power will be exercised when liability and quantum of damages have already been determined will, however, be exceptional. It would be more likely that a claim predicated on fraud would be dismissed on the merits, but striking it at a later stage was not so theoretical as to be impossible. The Supreme Court, somewhat unhelpfully, declined to define in advance the circumstances in which abuse of this kind might be found. On the facts, it would not be proportionate or just to strike out Summers’s claim as a whole, as he had suffered injuries for which the defendant was liable. The court did note, though, that after deductions including those for state disability benefits, Summers was unlikely to receive much, if anything, of the damages originally agreed.

[Link available here].