Case Alert - [2018] EWHC 37 (QB)



Judge considers whether fraudulent claim against insurer had been proven

Following a collision between two cars, the insurers of the allegedly negligent driver paid the defendant (after he obtained default judgment against their insured). However, the insurers then brought an action against the defendant seeking damages for deceit. They alleged that the accident had been staged.

Much of the case turns on its particular facts, with Teare J acknowledging that "There is rarely direct evidence of fraud. Where there is no direct evidence of fraud it can only be inferred from circumstantial evidence", with particular assistance often being gained from contemporaneous documents. Of particular importance in this case was that the drivers of the two cars were friends. The judge commented that " Of course it is possible for two friends to suffer a collision when driving their respective cars. It would however be a striking and unlikely coincidence. Another explanation for the collision is that the two friends had staged the collision; that would explain the apparent but unlikely coincidence". Of further importance here was the fact that they had initially tried to hide that friendship from the insurers. The defendant sought to argue that this was a case of fraudulent devices, in that he had lied for an innocent reason, namely "not to slow down the payment of a genuine claim" or because he feared that knowledge of the friendship might suggest to the insurers that the collision was not genuine because it was too much of a coincidence to be true. That argument was rejected by the judge who held that "The fact that the two drivers were friends and the circumstance that each of the persons present at the time has been reluctant to disclose that friendship are matters which, in my judgment, cogently suggest that the collision was staged".

The judge found in favour of the insurers.

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