Friday, February 23, 2007

Tainted by Fraud

The difficulty with partially fraudulent claims, which we have been trying to articulate on this blog, has it turns out already been elegantly expressed by Bingham LJ (as he then was) in Saunders v Edwards 1987 1 WLR 1116:

"On the one hand it is unacceptable that any Court of Law should aid or lend its authority to a party seeking to pursue or enforce an object or agreement which the law prohibits. On the other hand, it is unacceptable that the Court should, on the first indication of unlawfulness affecting any aspect of a transaction, draw up its skirts and refuse all assistance to the [claimant], no matter how serious his loss or how disproportionate his loss to the unlawfulness of his conduct"

This gives rise to any number of problems in practice. Few would have qualms about cross examining a dishonest Claimant at length, until (hopefully) their web of lies unwinds. Where a Claimant lies in a document verified by a statement of truth, I would go further and ask a court to send the papers to the Attorney General to consider prosecution (as in CPR 32.14). Equally however there must be many honest Claimants, who are put through invasive and aggressive questioning unnecessarily.

Fundamentally is it good enough to rely on common sense and instinct to decide when a fraud is so pervasive that the entire claim should fail, or should there be clearer rules?

1 comment:

Nearly Legal said...

A difficult question, but I don't think a rule can be set. I'd suggest it has to be on the facts and on how far it goes to the core of the claim.

For example, we recently acted in an ilegal eviction claim where there was, to put it mildly, a lack of evidence for the special damages in removed belongings that we were instructed to claim. There was, however, no doubt about the core of the claim, a particularly violent and unpleasant illegal eviction, nor about some conversion of belongings.

The Court was clearly sceptical on the claimed specials. General damages were awarded at a decent rate, but with an order for return of all converted property (without specifying that this was the property listed in the claim).

We reckon the chances of getting enforcement on this latter part, let alone a penal notice, are pretty low.

But the undisputed circumstances of the eviction meant that the core of the claim was genuine, the rest, which, let us say, lacked substantiation and a degree of plausibility, was dependant on and distinguishable from that core.

Maybe that might be a rough rule - does the fraud touch the cause of action?