The Court of Appeal upheld the judgment of the lower courts that there was no support in law for the proposition that a Claimant should be deprived of damages in his own claim purely on the basis that he had supported a fraudulent claim made by another person.
Anita Shah, the defendant, accepted that she negligently drove her car into the rear of a Rover, belonging to Wasim Ul-Haq, which had stopped at some traffic lights. Ul-Haq and his wife, Zahida Parveen, the driver and passenger in the vehicle, claimed for minor whiplash injuries, but a claim was also made by Ul-Haq’s mother for whiplash. Mrs Shah denied that Mrs Khartoon was in the car or was injured and disputed any personal injury claim. Birminingham County Court and the High Court held that the mother had not been in the car at the time and therefore that the mother’s claim, which had been submitted by Ul-Haq and Parveen, was fraudulent. The courts however considered that Ul-Haq and Parveen had genuinely suffered minor injuries and refused to strike out their claim. This decision was appealed to the Court of Appeal.The Court of Appeal upheld the decision of the lower courts. Lady Justice Smith considered that “it was invariably the case” that where a claim had been dishonestly exaggerated, a judge would award the Claimant the limited damages to which he was indisputably entitled. It was well established that a claimant would not be deprived of damages to which he was entitled because he had fraudlently attempted to obtain more than his entitlement. The courts held therefore that there was “no logical justification” for suggesting that a Claimant who had lied about another person’s claim should be treated any differently than someone who had lied about his own claim.The courts considered that the “policy of the law had not been to shut them out from justice altogether, save where the claim related to an insurance contract”: (Axa General Insurance Ltd v Gottlieb (2005) 1 All ER (Comm) 445). At the end of a ruling Lady Justice Smith said:“As a postscript, I would add that everyone knows that fraud is a scourge of our time;On the judge’s findings the claimants were guilty of serious criminal offences, including conspiracy to defraud and conspiracy to pervert the course of justice.“If, as has been suggested, such fraudulent claims have reached epidemic proportions, it may be that prosecutions are needed as a deterrent to others.”
A spokesman for the Association of British Insurers has commented: “We think it is wrong that someone should not be penalised for fraud.
“The genuine element of the claim should have been knocked out along with the fraudulent one. The courts should be sending out a message that crime doesn’t pay."