17/11/2022
As the function of the Court is to do justice between the parties, the Civil Procedure Rules place a great deal of emphasis on the honesty of the litigants, as without it there may be an unfair trial, or an abuse of process.
Parties to litigation are required to confirm that their evidence is true, to the best of their knowledge and belief – and there can be serious consequences for parties who fall short of that requirement.
In this article, we explore the judgments in three recent cases:
- Harrington Scott Limited v Coupe Bradbury Solicitors Limited [2022], in which a party had produced forged documents
- Rebekah Vardy v Coleen Rooney [2022], in which the Court concluded that the Claimant had destroyed evidence, and
- AXA Insurance Plc v Reid [2021], in which a false witness statement had been given.
1. Harrington Scott Limited v Coupe Bradbury Solicitors Limited [2022]
Background
The underlying claim related to three contracts entered into throughout the period 2008 to 2009 between a recruitment agency, Harrington Scott Limited (the Claimant) and two companies within the Kinross mining group for the provision of international recruitment services (the Kinross Contracts). In 2013, the Claimant alleged breaches of the three Kinross Contracts and instructed Coupe Bradbury Solicitors Limited (Coupe Bradbury) to prosecute claims against the relevant Kinross companies on the basis of fundamental contractual breaches and sums that Kinross had failed to pay under the contracts.
The claim was issued but an argument arose as to whether it had been validly served on the Kinross companies, which were both outside the jurisdiction. Subsequently, the Claimant entered into a compromise with the Kinross companies in October 2016 in full and final settlement of the underlying claim.
In 2019, the Claimant issued a professional negligence claim against Coupe Bradbury on the premise that a breach of duty on the part of the Defendant had caused the permission order to be set aside, resulting in a loss of the opportunity to pursue claims in relation to and recover sums under the Kinross Contracts. The Claimant claimed the full value of the underlying claim on the basis that it would have succeeded at trial.
Coupe Bradbury denied liability on the basis of the assertion that the underlying claim would not have succeeded at trial and applied to strike out the claim.
Issues
In reviewing the position, the Court noted the following:
- The Claimant had claimed costs for a Moscow Office which was described as “non-existent”
- The Claimant’s claim was premised on the basis that it was the contracting party to the Kinross Contracts. In fact, a separate BVI company had entered into those contracts
- The director for the Claimant in his witness statement had given evidence that not only contradicted an earlier witness statement in the first set of proceedings, but also a set of accounts signed on behalf of the BVI company, which did not document any record of receiving sums from the Kinross Contracts in a given period, when the evidence was that the company had, in fact, received substantial sums.
The Judgment
The Court was satisfied that the claim for costs in establishing the Moscow Office was a “deliberately exaggerated claim, dishonestly advanced by Mr Vickers against the Defendant after it had previously been advanced, and then abandoned, in the underlying claim. This is one of those very rare cases where it is possible for the court to discount any other explanation on the papers, and without cross-examination of Mr Vickers, because deliberate, and dishonest, exaggeration is the only explanation which is reconcilable with the reliable contemporary documentary evidence”. Consequently this part of the Claimant’s case was struck out.
Initially, the Court was unwilling to strike out the whole claim; although the Court considered it would be “amply justified” in doing so, it also stated that this would be a “most unusual and draconian measure”. Ultimately, the Court did strike out the entire claim when it became clear that, once the exaggerated elements were removed, the remaining claim consisted of new elements which had not been originally pleaded, and/ or claims with no prospects of success.
As well as the claim being struck out, it is likely that the Claimant had to pay the Defendant’s costs. Costs consequences of dishonesty were also central to the next case.
2. Rebekah Vardy v Coleen Rooney [2022]
Background
In June 2020, Rebekah Vardy commenced a libel claim against Colleen Rooney following a social media post accusing Ms Vardy of leaking information from a private Instagram account to the press. Over three years since the viral social media post, the high-profile “Wagatha Christie” trial finally concluded with a costs order for Ms Vardy to pay 90% of Ms Rooney’s costs.
The Judgment
In July 2022, the High Court dismissed Ms Vardy’s libel claim, finding that Ms Rooney had succeeded in establishing that “the essence of the libel was substantially true”. A substantial and noteworthy part of the Court’s judgment focussed upon the gaps in Ms Vardy’s documentary evidence as well as her overall credibility as a witness in evidence given at trial.
Addressing gaps in the documentary evidence, the Court was highly critical of the absence of the original WhatsApp exchanges between Ms Vardy and her agent, Caroline Watt, during the period when Ms Vardy had access to Ms Rooney’s private Instagram. In particular, the Court considered it to be likely that Ms Vardy had deliberately deleted the WhatsApp exchange. The Court also did not accept the evidence that Ms Watt had accidentally dropped her phone into the sea, as she had claimed during a disclosure application, and instead concluded that she had deliberately lost her phone. The Court also found that there had been numerous occasions throughout the trial where Ms Vardy’s evidence had been both “evasive” and “manifestly inconsistent” with the documentary evidence. Having regard to both Ms Vardy’s lack of credibility as a witness and drawing inferences from the destroyed evidence, the Court concluded that it was likely that Ms Vardy and Caroline Watt had leaked information from Ms Rooney’s private Instagram.
At a hearing on 4 October 2022, the Court again considered Ms Vardy’s dishonest conduct in the context of awarding costs. Due to Ms Vardy and Caroline Watt being found to have deliberately destroyed evidence, the Court ordered that Ms Vardy is to pay Ms Rooney’s costs on an “indemnity” basis. What this means is that there is a presumption in favour of the receiving party that the costs were proportionate, and will therefore be recoverable provided they were reasonably incurred and reasonable in amount.
Given that it was reported that Ms Rooney’s legal costs were in excess of £1.5m, then the lack of honesty in this case cost Ms Vardy dear.
As well as costs consequences, the Court also has the option to consider penal consequences, as can be seen from the next case.
3. AXA Insurance Plc v Reid [2021]
Background
In 2018 the Defendant, Alex Reid, suffered a road traffic accident and sought to make a personal injury claim to the value of around £20,000. During the course of the personal injury proceedings, Mr Reid provided a witness statement comprising a declaration that he did not know and had never met the eyewitness to the accident, Darren Summers. In compliance with Civil Procedure Rule 22, the witness statement had been completed with a statement of truth.
The Claimant, AXA Insurance Plc, subsequently located an online article dated four months before the road traffic accident stating that the Defendant would be providing a martial arts masterclass at a charity event organised by Mr Summers. It thus became apparent that the Defendant did in fact know Mr Summers and had falsely stated in his witness statement that Mr Summers was an independent witness to the accident.
In light of this information, the Claimant sought to amend its defence to plead a case of fundamental dishonesty, however the Defendant discontinued the claim before the application could be heard. In view of the Defendant’s dishonest conduct, the Claimant instead sought to pursue criminal proceedings for contempt of court.
The Judgment
The Court was satisfied that the Defendant’s dishonest conduct throughout the course of the personal injury proceedings amounted to a deliberate attempt to interfere with the administration of justice in a material way and thus met the criminal standard of contempt of court.
In addressing the appropriate sanction, the Court referred to the authority in Liverpool Victoria v Khan [2020] where the court had specifically discussed making a false statement that was verified by a statement of truth and had stated that “the deliberate or reckless making of a false statement in a document verified by a statement of truth will usually be so inherently serious that nothing other than an order for committal to prison will be sufficient”. It was evident that the false statement had been made to strengthen the Defendant’s claim on liability and to consequently increase his chances of recovering damages and whilst the Defendant did not in the end benefit from this dishonest behaviour, the false statement was in itself serious enough to warrant a prison sentence.
The Court was clear that contempt of court in the form of a false witness statement “is always serious” even if it does not ultimately affect the outcome of the proceedings.
Conclusion
The judgments in all three cases strongly illustrate the Court’s general condemnation of any dishonest conduct which attempts to subvert the adjudicative process.
Despite the court’s unequivocal disapproval of dishonest behaviour, the judgment in Harrington Scott Limited v Coupe Bradbury Solicitors Limited also serves as a useful reminder as to the high threshold for determining that the dishonesty has led to an abuse of process of the type that would prevent the court from carrying out justice. Whilst dishonesty may in principle justify the strike out of an entire claim, in practice, a consideration of the court’s overriding objective may prompt the court to first pursue alternative options.
This article was co-written by Judith Hopper, Partner and Alexandra Phillips, Trainee Solicitor.
