A defendant cannot withdraw an admission of liability because the value of a claim has increased, the High Court has ruled.
Mrs Justice Laing said she accepted counsel for the claimant’s arguments that a wheelchair supplier took a “commercial decision to avoid the costs of fighting liability in what it then thought was a low-value claim”.
She said the supplier’s “experienced loss adjusters” also took a calculated risk that the value of the claim might increase after the admission.
Laing J said that, despite the supplier’s other arguments, the rise in value of Ms Wood’s personal injury claim since 2010 was the “real ground” for its application to resile from a pre-action admission of liability.
“But that is a risk which is inherent in any personal injuries claim, and is a reason why it can sometimes be commercially advantageous to try and settle a claim at an early stage.
“I do not consider that the fact that potential value of the claim has increased since the admission is a good reason for allowing the defendant to withdraw the admission”.
The court heard in Wood v Days Health Care and others (case no. 2BM90233), reported by Lawtel, that Ms Wood was a paraplegic who relied on a motorised wheelchair.
Laing J said: “Her case is that she was using her wheelchair when the chair riser shot forwards, propelling her into her desk, pinning her against it and injuring her.”
After the accident Ms Wood brought proceedings against all those involved in the production and supply of the wheelchair, including Days Health Care, a second supplier and the health secretary, since her local primary care trust had been dissolved and the health secretary had assumed its liabilities.
Laing J said the application by Days Health Care to withdraw its admission fell under CPR Practice Direction 14.7.2, which states that courts must take into account “all the circumstances”.
She said there was no new evidence about the circumstances of the accident and the first defendant had inspected the wheelchair before it made its admission of liability.
The judge said the next factor was the conduct of the parties, who had made “many submissions” on the issue of delay.
Laing J said the “crucial period” was between the date of the admission and the time when the defendant indicated that it was going to resile from it.
She inferred that when the supplier realised that Ms Wood’s injuries might be more serious than she had suggested and that damages, rather than being a maximum of £25,000, “could be in the region of £300,000”, the supplier “looked more closely at the documents it had”.
The judge concluded that Days Health Care was “to blame for the delay between the date of the admission and the first intimation that it would be withdrawn” and the claimant could not be criticised for her conduct.
She said that both the claimant and the health secretary argued that they would suffer prejudice if the admission was withdrawn, while the first defendant had the advantage, with notice of the claim, of having “investigated promptly”, when it was easier to find relevant documents.
Laing J said the interests of justice included finality, and the defendant had “made an admission on professional advice, having had a good opportunity to investigate the facts and to inspect the accident wheelchair, and should, in the interests of finality, be held to that admission.”
She added that her decision, earlier in the ruling, to give summary judgment against the health secretary on the claimant’s contractual claim, was not a reason for allowing the defendant to withdraw. Laing J dismissed its application to withdraw the admission.