Motor Brief: latest decisions August 2017

A round up of recent court decisions raising issues relating to the scope of qualified one-way costs shifting and fixed costs regimes; the ability to sue an unidentified defendant, assignment of CFAs and a comparison of the requirements to bring committal proceedings in cases involving fraud and contempt of court.

QOCS: does it apply to claims made under the Motor Vehicles (Compulsory Insurance) Regulations 2003?

Michael Howe v Motor Insurers' Bureau [06.07.17]

The claimant’s initial claim was dismissed as being time barred and he was ordered to pay 85% of the MIB’s costs. At appeal, he argued that the MIB’s costs should be limited by virtue of the QOCS regime. It was held that the QOSC regime did apply to claims made under the Regulations as the principles of effectiveness and equivalence were engaged and reference to ‘damages for personal injuries’ could be interpreted to include a claim for ‘compensation’.

Full case review: QOCS and Part 20 claims: never the twain shall meet

Contact: Martin Cox

Not an EL/PL claim; not an RTA: do fixed costs apply?

Prescott (a child) v The Trustees of the Pencarrow 2012 Maintenance Fund [12.06.17]

The claimant was injured when the car he was a passenger in collided with a tree which fell onto the highway. The personal injury claim was settled for £1,000 but costs remained in dispute. The claim fell outside the RTA pre-action Protocol as the injury had not been caused by another road vehicle. It also fell outside the EL and PL pre-action Protocol as damages arising out of a road traffic accident are specifically excluded.

It was held that a literal interpretation of the rules would produce a perverse result that had not been intended. In circumstances where such litigation carried no increased risks, the fixed costs regime should apply. The matter was determined to fall within the EL/PL fixed costs regime.

Contact: Ian Davies

Contempt of court: “perjury on an industrial scale”

Accident Exchange Ltd v Broom & others [24.05.17]

Seven expert witnesses who fabricated evidence about the cost of replacement hire cars have been jailed. In a case where there was overwhelming evidence that the defendants (who worked for Autofocus Ltd) had knowingly and actively participated in ‘the systematic, endemic fabrication of evidence’, the court granted the motor insurer’s application to commit the defendants’ expert rate surveyors to prison for contempt of court. Examples of the evidence considered by the court were the defendants’ admissions during trial to having verified documents knowing them to be false, as well as admission to having given false evidence in court. Accident Exchange estimated that 30,000 cases were affected by false reports. Sentences of imprisonment ranged from six months to 13 months.

Contact: Jennifer Harris

A changing landscape: claimant allowed to sue unknown person

Cameron v Hussain and Liverpool Victoria Insurance Co Ltd [23.05.17]

The claimant was the victim of a ‘hit and run’ collision but a witness to the incident had been able to record the registration number of the tortfeasor vehicle. This allowed the insurer of the vehicle to be identified through the Motor Insurance Database. The claimant decided to pursue her claim against the insurer, rather than the MIB.
The Court of Appeal allowed the claim, confirming that the insurer of the vehicle being driven by the “unknown person” is obliged to satisfy the judgment pursuant to s.151 of the Road Traffic Act 1988.

Full case review: A changing landscape: claimant allowed to sue unknown person

Contact: Mark Walsh

Transitional CFAs: compensator challenge dismissed by Supreme Court

Plevin (respondent) v Paragon Personal Finance Limited (appellant) [29.03.17]

The respondent entered into a conditional fee agreement (CFA) with her original solicitors in 2008. Subsequently, there were two technical changes of solicitor. The appellant sought to argue that the CFA was not validly assigned and therefore no effective retainer was in place at the time when costs were incurred.

The Supreme Court rejected the argument and held that the CFA was validly assigned and the success fee is therefore recoverable. This ruling is now the highest authority that when CFAs are validly assigned they will be upheld by the courts, enabling successful claimants to recover their success fee if the original CFA was entered into before 1 April 2013.

Full case review: Assignment of CFAs: compensator challenge dismissed by Supreme Court

Contact: Richard West

Fraud: a high standard for committal proceedings

AXA Corporate Solution Services Ltd v Khan & Anor [27.02.17]

The respondents’ claim at first instance failed on the basis that the collision had been deliberately staged. Eighteen months later, the applicant insurer applied for permission to bring committal proceedings against the respondents. They argued that the public interest test had been satisfied, emphasising that the proceedings would act as a deterrent and would raise public awareness with regard to false road traffic claims.

The application was refused. The court held that a finding of fraud by a trial judge did not automatically mean committal proceedings should follow. The evidence of fraud was circumstantial and there was no evidence of conspiracy. Further, the delay in bringing the committal proceedings was a significant and decisive factor which had to be taken into account.

Contact: Martin Stockdale

Read other items in the Motor Brief - August 2017