A personal injury claim, which was later contested by insurers when it was discovered that the claimant had been dishonest has been allowed to stand at the Court of Appeal.
Despite the employer’s insurers obtaining video footage appearing to show the victim had exaggerated the affects of his injury, an out-of-court settlement of almost £135,000 was originally agreed to be paid in compensation for a back injury suffered by the victim following an accident at work.
Two years later, the insurers received information from the claimant’s next-door neighbours, which suggested the victim had completely recovered from his injury one year before the settlement. In response, proceedings were began to claim back damages from the claimant for the apparent deception, equivalent to the difference between the settlement made and the amount that would have been awarded if the extent of the injury had been truthfully disclosed.
At the subsequent court hearing, the insurer’s received a judgment in their favour, which reduced the victim’s final damages to £14,720, and who was directed to repay the balance of the settlement. However, the claimant appealed the decision at a Court of Appeal where the judge said the preceding verdict was “unattractive” and pointed to “a wider principle at stake.”
Explaining further, the judge said that “parties who settle claims with their eyes wide open should not be entitled to revive them only because better evidence comes along later.” This refers to the insurers’ original decision to settle and therefore, had taken the risk over the possibility that the original statements were untrue.
At the appeal, the claimant’s legal team argued that the insurer’s needed to prove they had been “deceived” rather than simply “influenced” by the original statements in order for the original settlement to be set aside.
In reply, the insurer’s said ‘misrepresentations’ about the effects of the victim’s injury had caused them to settle because the insurer feared the victim would be believed in court. Even their own expert representative was “not fully persuaded” that the claimant was being wholly honest.
Summing up, the judge highlighted that “there is an important public interest in the finality of statements”, adding that the insurers “could have taken the case to trial in order to disprove the statements in question”, but by agreeing to settle had let go the opportunity and “cannot reserve the right to come back later for another attempt.”