Developments Since the Introduction of Section 26 of the Civil Liability and Courts Act 2004 and its effect on Personal injury fraud in Ireland:

The enactment of the Civil Liability and Courts Act 2004 marked a significant shift in the landscape of personal injury claims in Ireland, with specific provisions aimed at curbing fraudulent claims and preventing dishonest conduct in the litigation process. The introduction of Sections 14, 25, and 26 has had particular importance in tackling the issue of misrepresentation in personal injury actions.

These provisions were designed to enhance transparency, deter dishonest practices, and ensure that claims made in court are legitimate. Section 26, in particular, has had a significant effect on how personal injury cases are litigated in Ireland.

Key Provisions of the Civil Liability and Courts Act 2004:

• Section 14:
  Section 14 requires all parties involved in personal injury litigation to swear an affidavit affirming that the statements made in their pleadings are true and correct. This affidavit must substantiate the facts and allegations contained in the claim. Notably, Section 14(5) makes it a criminal offence for an individual to swear a false affidavit knowingly. This provision aims to promote the integrity of the claims process and hold individuals accountable for making dishonest or exaggerated claims.

• Section 25:
  Section 25 extends the liability to any individual who dishonestly introduces or causes false or misleading evidence to be presented in a personal injury case. This includes misleading medical reports, witness statements, or any other evidence relevant to the case. This provision helps to prevent parties from attempting to mislead the court through fraudulent means.

• Section 26:
  Section 26 is perhaps the most significant provision in the Act for preventing fraudulent claims. It mandates that if a plaintiff knowingly introduces or causes to be introduced evidence that is materially false or misleading, the court must dismiss the claim unless, for reasons stated in its decision, doing so would result in injustice. This provision places the onus on plaintiffs to prove the veracity of their claims, and failure to do so can lead to the dismissal of the action.

Impact of Section 26 on Personal Injury Fraud in Ireland

Since the implementation of Section 26, the volume of Personal injury fraud in Ireland has decreased, as claimants are now more cautious about presenting false or misleading evidence. Several high-value claims, particularly those involving special damages, have been withdrawn or dismissed after inconsistencies or false evidence was uncovered.

The application of Section 26 has also forced legal practitioners to adopt a more rigorous approach when investigating personal injury claims, ensuring that only valid claims proceed to trial.

Notable Case Law Under Section 26:

Several landmark cases have clarified the application of Section 26 and highlighted the consequences of presenting fraudulent or exaggerated claims.

• Mary Farrell v. Dublin Bus [2010] IEHC 327:
  In this case, the plaintiff, Mary Farrell, was involved in a whiplash accident and sought compensation for ongoing loss of earnings, claiming damages amounting to €343,000. However, after further investigation, the defendant discovered inconsistencies in the plaintiff’s sworn affidavits regarding her earnings. Farrell had made contradictory statements about her income, and the court found that she had knowingly provided false evidence to support her claim. As a result, the court dismissed the plaintiff’s claim, applying Section 26 of the Civil Liability and Courts Act.

• Danagher v. Glantine Inns Limited [2010] IEHC 214:
  This case involved a plaintiff who had been found to have misled the court by presenting false evidence, including social media posts that contradicted the claim of injury. The court held that the plaintiff had violated Section 26 by intentionally providing misleading evidence, and the claim was dismissed. This case serves as an important reminder that courts now scrutinise evidence carefully, including digital evidence, in personal injury claims.

• Boland v. Dublin City Council and Others [2011] IEHC 176:
  The plaintiff in this case was found to have fabricated aspects of the accident and the special damages claim. Despite the injury being acknowledged, the plaintiff’s dishonest account of the facts and misrepresentation of the special damages led to the dismissal of the claim under Section 26. This case reinforces the importance of honesty and consistency in presenting a personal injury claim.

Judicial Approach: Balancing Fairness with Fraud Prevention in tackling Personal injury fraud in Ireland

While Section 26 is an important tool for combatting fraud, the courts have consistently stressed the importance of ensuring that genuine claimants are not unjustly penalised. Judges have indicated that small inconsistencies or unexplained anomalies in a claimant’s evidence should not automatically lead to a dismissal of the claim. In cases where there is no clear evidence of fraudulent intent, courts have been willing to allow claimants to explain any discrepancies before dismissing their cases.

For example, in the case of Dunleavy v. Swann Park Limited trading as Hair Republic [2011] IEHC 232, the court found that, while there were inconsistencies in the plaintiff’s evidence, it was important to consider the claimant’s explanations before deciding to dismiss the case. In this instance, despite the plaintiff’s failure to disclose a previous accident and psychiatric history, the judge accepted the plaintiff’s explanations and concluded that there was no deliberate intention to mislead the court.

As stated by Judge O’Neill in this case:

“Section 26 of the Civil Liability and Courts Act 2004 is intended to deter fraudulent claims. However, it should not be used as a pretext to dismiss a claim based on minor anomalies or unexplained inconsistencies without proper scrutiny.”

This cautious approach demonstrates the court’s desire to avoid wrongful dismissal of claims and ensure fairness to claimants who may have made innocent mistakes or overlooked certain details.

Aherne v. Bus Eireann [2011] IESC 44:

The most recent case interpreting Section 26 is Aherne v. Bus Eireann [2011] IESC 44, where the Judgment was delivered last Friday 2nd December 2011 by the Supreme Court. The plaintiff, a 78-year-old woman, claimed to need a carer after a bus accident. While the issue of liability was not contested, the need for future care was disputed, and the plaintiff later withdrew this aspect of her claim. The defendant argued that the plaintiff had provided misleading evidence and that the claim should be dismissed under Section 26.

The Supreme Court upheld the High Court’s ruling, stating that there was no evidence of fraudulent conduct. The court noted that the plaintiff’s linking of her deterioration to the accident, rather than to her pre-existing conditions, was understandable and did not constitute deliberate misrepresentation. The Supreme Court emphasised that the burden of proof rests on the defendant to demonstrate that the evidence was false or misleading. The appeal was dismissed as the Court found no basis to interfere with the High Court’s finding of fact.

Conclusion:

Section 26 of the Civil Liability and Courts Act 2004 plays a critical role in preventing Personal injury fraud in Ireland in Ireland. It places the onus on plaintiffs to provide truthful and accurate evidence, with severe consequences for those who attempt to deceive the court. However, the courts have made it clear that this provision must be applied with care, ensuring that genuine claimants are not unjustly penalised.

For insurance defence firms in Ireland and the UK, understanding Section 26 is crucial in defending against fraudulent claims. It is essential to investigate claims thoroughly, identify inconsistencies or false evidence, and present a well-reasoned defence to avoid unjust compensation. However, it is equally important to avoid prematurely dismissing claims based solely on minor anomalies or discrepancies without carefully considering the context and the claimant’s intentions.

At Lacey Solicitors, we specialise in insurance defence and are committed to tackling personal injury fraud in Ireland. With extensive expertise in fraud prevention, Damian McGeady, Partner in Charge of Fraud Prevention, leads our efforts to protect clients from fraudulent claims and ensure a fair legal process.