Give courts power to tackle dishonest claimants

The Court of Session. An attempted fraud could be categorised by the court as an abuse of process. Picture: Greg Macvean
The Court of Session. An attempted fraud could be categorised by the court as an abuse of process. Picture: Greg Macvean
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THE Scottish courts have long enjoyed a reputation for fairness. The judiciary have widely recognised that every civil litigant has a general right to pursue his or her case to judgment. However, with growing concerns about fraudulent claims, does the Scottish judiciary have sufficient power to deal with dishonest personal injury claimants at the earliest opportunity?

An attempted fraud could be categorised by the court as an abuse of process. The Court of Session has indicated that it has an inherent power to dismiss a claim where the party pursuing it has been guilty of such an abuse. However, the circumstances in which that power will be exercised are limited. Certain other powers available to Scottish judges to deal with fraudulent claimants are only likely to be exercised after the expense of a trial or hearing has been incurred, for example, referring cases to the prosecuting authorities where the court believes that the pursuer has lied about his personal injury claim. Accordingly, it will usually be necessary for the issue or issues between the parties to proceed all the way to a trial or proof.

In England and Wales, civil procedure rules (CPR) require personal injury claimants to lodge a sworn statement in support of their claim at an early stage. The rules also stipulate that if the statement of case can be shown to be an abuse of the court’s process then applications can be made for “strike out”.

Additionally, contempt of court proceedings may be brought against a person if he makes or causes to be made a false statement in a document, such as his pleadings, verified by a statement of truth without an honest belief in its truth. Is it now time to introduce similar provisions in Scotland? 
In his review of legal expenses in Scotland (The Taylor Review), Sheriff Principal Taylor recognised that there is a need to guard against the risk of fraudulent personal injury claims. Amongst other things, the Taylor Review recommended that there should be qualified one-way costs shifting in personal injury litigation, or QOCS as it has become known in England and Wales. QOCS is designed to provide that defenders pay the pursuer’s judicial expenses in the event that a pursuer succeeds in litigation.

In addition, however, should the pursuer be unsuccessful then, ordinarily, no award of expenses would be made in favour of the defenders. This is designed to improve access to justice. As Sheriff Principal Taylor has said: “This removes the spectre of the pursuer being bankrupted by an adverse award of expenses.”

The Taylor Review set out a number of proposed exceptions to QOCS. One of these is fraud. It was recognised that the introduction of QOCS could lead to some more dubious claims being pursued. The proposal for dealing with this is that if the court holds, on the balance of probabilities, that there has been fraud on the part of the Pursuer then he will lose the benefit of QOCS.

Sheriff Principal Taylor anticipated that a procedure would be introduced whereby a defender may seek to strike out summarily any case, which has no real prospect of success.

If rules similar to those operating south of the Border are introduced then it may be possible to demonstrate that a fair trial is impossible in a case which has “no real prospect of success” on the grounds that the Pursuer has been so dishonest as to have been guilty of an abuse of process. That may lead us into the same sort of territory as our colleagues in England and Wales who, in the context of The Criminal Justice and Courts Bill, are currently debating how dishonest a claimant has to be before his claim should be dismissed entirely.

The Bill proposes that the court must dismiss all of a claim for damages for personal injuries if it is satisfied, on the balance of probabilities, that the claimant has been “fundamentally dishonest”, unless this would cause the claimant to suffer “substantial injustice”. There has been a lot of debate on what amounts to “fundamental dishonesty”. It has been suggested that the use of “fundamentally” is intended to limit the provision to those cases where the dishonesty goes to the heart of the whole claim, or certainly to a very important element of it. However, to others “dishonesty is one of those absolute concepts: either you are dishonest or you are not”.

Anything that will enable Scottish judges to deal with highly dubious personal injury claims earlier than they are able to at the moment would be welcome. 
• Tony Murray is a partner with BLM www.blmlaw.com