Exaggerated & Fraudulent Claims: New Beginnings?

By Louise Smith
11th September, 2017

An analysis of the recent Court of Appeal judgment: Platt v. OBH Luxury Accommodation Limited & Anor [2017] IECA 221.

Introduction

On 28 July 2017 Ms. Justice Irvine in the Court of Appeal delivered her Judgment in the case of Platt v OBH Luxury Accommodation Limited & Anor [2017] IECA 221 (hereinafter “Platt”). The case was an appeal of the decision of Barton J. in the High Court from June 2015, wherein Barton J. was satisfied that the Plaintiff had intentionally misled the court and exaggerated his injuries and so he utilised the jurisdiction conferred on him by s. 26 of the Civil Liability and Courts Act, 2004 (“the 2004 Act”) in dismissing the Plaintiff’s case.

The Court of Appeal upheld the decision of the High Court and in so doing has given further insight into how the courts will apply s. 26 of the 2004 Act and what exactly constitutes an intentionally fraudulent claim.

Section 26 Explained

Section 26 of the 2004 Act prohibits plaintiffs from knowingly giving evidence that is false or misleading. If an application under s. 26 is successful, the plaintiff’s claim is dismissed, even if there is liability on the part of the defendants, save for where the court considers that a dismissal would result in an injustice.

Background to case

The Plaintiff, Mr Jason Platt, sustained life threatening injuries in 2009 when he fell from a windowsill in a room in the defendant’s hotel. He suffered severe injuries to his ribs, spine and hip. Through sworn affidavits and testimony submitted by the Plaintiff before the High Court, Mr. Platt had presented himself as a man who was in chronic pain and severely incapacitated by the injuries sustained from the fall. Mr. Platt had also sworn an affidavit verifying a schedule of special damages and future loss claiming almost £1.5 million.

High Court Decision

Despite finding the Defendants 60% liable, Barton J. dismissed the Plaintiff’s claim after reviewing video evidence of the Plaintiff submitted by the Defendants. This video evidence showed the Plaintiff regularly driving, going shopping, carrying groceries, closing his boot and walking unaided. This evidence was in stark contrast to the presentation of the Plaintiff to the Court of a man profoundly disabled as a result of his injuries with the Plaintiff giving evidence himself to the effect that he was compelled to mobilise using either crutches, a wheelchair or a commode.

Court of Appeal decision

Dismissing the Appeal, Irvine J said of the Plaintiff that “his dishonesty was repeated and determined” and was satisfied that the Plaintiff had given “evidence that was false and misleading in a material respect”. The Court of Appeal stated that the very purpose of s. 26 was to operate as a significant deterrent to those who would bring fraudulent claims, due to the draconian nature of its application.

General Principles of Section 26 Applications

The Court held the standard of proof that is required in order to successfully invoke s. 26 was the balance of probability but regard must be had to the seriousness of the matter being alleged, the gravity of the issue and the consequences in considering the evidence necessary to discharge the onus of proof.

The Court also held that mere errors by the Plaintiff were not enough to ground a successful s. 26 application by the Defendants. Irvine J. stated in Platt that

“it is not open to a defendant to make an application under section 26 of the Act unless the plaintiff in the course of the hearing is afforded an opportunity of countering the assertion that they gave false or misleading evidence or caused such evidence to be adduced on their behalf, knowing it to be fraudulent.”

The Court noted that if a s. 26 application is successful the claim as a whole must fail, as stated in the case of Meehan v BKNS Curtain Walling Systems Ltd. [2012] IEHC 441. Irvine J. went on to state that “the plain and ordinary meaning of the words make clear that if the evidence is false and misleading in a material respect “the action” shall be dismissed. The section is simply incapable of any other construction”.

The concept of “injustice” under section 26

Counsel for the Plaintiff submitted that the High Court had erred in law by failing to conclude that an injustice would be done to the Plaintiff should his action be dismissed (s. 26 (2)), given the severity of the Plaintiff’s injuries.

In the High Court decision of Looby v Fatalski & anor [2014] IEHC 564 (hereinafter “Looby”) Barr J. found that the Plaintiff had “candidly admitted that he had told the lies so that he would get more money in his claim”. However he was satisfied in that case there would be an injustice if the action were to be dismissed, in circumstances where the Plaintiff had always admitted to being able to cycle, but had lied in respect of the distances and lengths of time for which he could cycle.

The Court in Platt, however, noted that the outcome of depriving a plaintiff of damages legitimately incurred was anticipated by the Oireachtas in enacting the legislation. The Court referred to the case of Higgins v Caldark [2010] IEHC 527 where it was stated that not only was it anticipated that a successful application would deprive the plaintiff of damages they would otherwise be entitled to, “section 26 of the Act contemplates such a response”.

The Court must also look at the consequences for a plaintiff where a claim is dismissed under s. 26. While adverse consequences cannot be the only factor considered in dismissing a s. 26 application, the Court still held that it can be considered amongst other relevant factors. A failure by a court to do so would run contrary to the Court’s obligations to construe legislation in accordance with the constitutional principles of fairness and proportionality.

The findings of the Court of Appeal

Having considered all submissions and evidence, the Court of Appeal held that the finding of Barton J. in the High Court was correct. The submission on behalf of the Plaintiff that a finding against the Plaintiff under s. 26 would amount to an interference with his right to bodily integrity under Art 40.3.2 of the Constitution was also dismissed, the Court siding with the argument put forth by John Lucey S.C. for the Defendants, that a claim such as this was “precisely the type of case the Oireachtas had in mind when the (Section 26) legislation was enacted”.

The Court held that in certain cases, the conduct of the defendants may have a bearing on whether an injustice would be held to occur in dismissing a claim for fraud. The Court held that if it were a case that the wrongs of the defendants were considered to be equal to that of the plaintiffs “perhaps the Court might consider it unjust to make the order sought.”

The Court held that another factor to be considered in seeking to construe s. 26 in a proportionate and fair manner was the extent of the falsity of the evidence and the extent the plaintiff sought to gain from their own false evidence. A further consideration in s. 26 cases was held to be the extent the plaintiff deceived their own experts into giving false evidence. The Court stated that such actions would be “material to the court’s consideration as to whether it would be unjust to dismiss his claim”.

Affidavits of Verification

The Court stated that when knowingly fraudulent information is provided on sworn affidavit by the plaintiff to the defendant prior to the trial, and not just when such information is presented before a court, such behaviour may be caught by s. 26. Furthermore, the Court of Appeal opined that if fraudulent information (in this case the final Schedule of Special Damages in particular) is provided or sworn as true on affidavit, the Plaintiff cannot avoid the operation of s. 26 by subsequently withdrawing such information. The Court was careful not to give a definitive view on this matter, but nonetheless the consideration of what fraudulent conduct is caught by s. 26 may be instructive for future s. 26 applications.

Conclusion

The Court’s decision in Platt will be highly instructive for solicitors considering bringing s. 26 applications in the future. It remains difficult for defendants to successfully invoke s. 26. However, it is hoped that the decision of the Court of Appeal in Platt marks the start of a change in the attitude of the judiciary towards how s. 26 applications are considered in the future.

For more information on the content of this Insight contact:
Louise Smith, Solicitor, louise.smith@rdj.ie, +353 21 4802710