A leading insurance company that had to appeal to the High Court to secure a finding of fundamental dishonesty in a personal injury claim said the case showed the industry needed “more support” from judges if they are to challenge fraudulent claims.
LV= said the first instance decision showed “just how hard it is for us to win even when the facts speak for themselves”.
Manchester insurance firm Horwich Farrelly acted for LV= in the case of Robert Fithon, a mortgage advisor with a part-time career in dance music.
It said that, following a minor motor collision in September 2016 in Manchester, Mr Fithon claimed that his vehicle was hit with such a “heavy and violent impact” – which felt like “a small bomb going off” – that the muscles and tendons of his shoulder were “crushed”.
The injury was so severe he claimed, that it took 10 months to heal correctly.
However, Horwich Farrelly found that, in reality, Mr Fithon had been discharged from physiotherapy five weeks after the accident having undergone only two sessions, with a 100% recovery.
He had also claimed he was unable to attend his gym for three months due to his injuries. However, the physiotherapy discharge report showed that, five weeks after the accident, he was able to “do all gym exercises pain free when using good technique” and that he could “perform all gym activities to his pre-accident levels of ability”.
At first instance, a judge at Manchester County Court found that Mr Fithon had greatly exaggerated his claim, prompting him to disregard the evidence in its entirety. However, he found he had no option other than to award damages on the basis of the physiotherapy discharge report, awarding Mr Fithon £1,869.
Horwich Farrelly argued on appeal that the judge had not properly applied the fundamental dishonesty rule in section 57 of the Criminal Justice and Courts Act 2015, and Mr Justice Andrews agreed.
He allowed the appeal and dismissed Mr Fithon’s claim on the basis that it was fundamentally dishonest.
Martin Milliner, GI claims director at LV=, said: “Insurers are often wrongly criticised for not defending enough spurious whiplash claims. The original court decision highlights just how hard it is for us to win even when the facts speak for themselves.
“Taking whiplash claims to the High Court on appeal is a disproportionately expensive way to underline the point that, for insurers to defend more cases to trial, we need more backing, support and certainty of outcome from the judicial process, especially at first instance.”
Ronan McCann, counter fraud partner at Horwich Farrelly, added: “We hope this successful outcome will encourage the industry to tackle more fraudulent claims and will help ensure both consumers and insurers benefit from the costs saved on unmerited claims.”
Horwich Farrelly has now secured nine findings of fundamental dishonesty since securing its first in April 2016.