The need for plain defences.

As counsel representing – for the most part – the interests of claimants in personal injury claims, I have witnessed numerous arguments being put forward by defendants when it comes to defendants’ understanding of the responsibility for pleading fraud or fundamental dishonesty.

The ‘usual’ argument has previously focused on the Court of Appeal’s decision in Kearsley v Klarfeld [2005] EWCA Civ 1510. The defendants would argue that this was good authority for the proposition that fraud and fundamental dishonesty did not need to be expressly pleaded.

Although there is a tendency to use the authority of Kearsley to support the defendant’s contention that fraud or fundamental dishonesty did not have to be pleaded at all – whether low velocity impact (LVI) was an issue or not – more astute judges would make the important distinction between the general rules of pleading (as set out in CPR 16) and the sub-species of an LVI causation case.

Howlett v Ageas (2017) EWCA Civ 1696

Now, at least from the headlines given to the authority of Howlett, it seems the defendant now has more ammunition to suggest that fraud or fundamental dishonesty does not need to be explicitly pleaded. Headlines, however, are very misleading.

My own view is that Howlett, if anything, very much supports the need for clear and unequivocal defences. Howlett reinforces a number of established principles concerning the importance of pleadings and re-instates the (rather obvious) point that a trial judge can give their own interpretation of the credibility of any party or witness without the existence of pleadings and absent any cross-examination of defendant counsel.

The purpose of this article is to reiterate precisely what happened in Howlett, what was decided and why, infact, it reinforces the need for clear pleadings.

The defence in Howlett

To the credit of the defendant, the Defence in Howlett was actually very clear.

The defence:

(a) confirmed that the defendant did:

not accept the index accident occurred as alleged or at all’ (paragraph 5);

(b) required the claimants:

‘to strictly prove’ that they ‘were involved in the index accident’ (paragraph 5);

(c) Further:

‘If, which is denied, there was an accident as alleged, [Ageas] will aver that it was a low velocity impact unlikely to cause injury with injury being unforeseeable in any event.’ (paragraph 5);

(d) Yet further:

‘on a balance of probabilities, set against the backdrop of the following fact and/or contentions:

(i) The claimants [i.e. the Howletts] contend that on 27 March 2014 they were passengers in the first defendant’s vehicle when the first defendant [i.e. Ms Davies] seems to have reversed down her driveway and into collision with a parked and unoccupied X3 belonging to a Sharon Tutton.

(ii) The claim to have been injured as a result, yet the damage to the X3 was de minimus.

(iii) Just three months prior, on 7 December 2012, the claimants contend they were passengers in the first defendant’s vehicle and the first defendant was involved in another road traffic accident wherein she was the at fault driver and the claimants contend they were yet again injured.

(iv) The second defendant [i.e. Ageas] avers that this is beyond coincidence and, instead, is indicative of a staged/contrived accident and injury.

(v) This is corroborated by the fact that the second defendant failed to disclose this earlier accident to his medical expert.

(vi) Moreover, the first defendant has been involved in at least four road traffic accidents between 2011 and 2013. Again, the second defendant avers that this is beyond coincidence.

(vii) This is also corroborated by the lack of full co-operation from the first defendant, in particular as regards an inspection of her vehicle.

(viii) The claimants and the first defendant given an unlikely/uncorroborated journey purpose and have given inconsistent/unlikely accounts as to injury.

(ix) The locus of the purported index accident is large and unlikely to have obscured/hidden the presence of the said X3.

(x) Despite there being damage and multiple injuries, there would appear to have been no witnesses and neither were the emergency services involved.

(xi) Despite being recommended physiotherapy, the claimants have failed to avail themselves of the same. Adverse inferences will be sought at Trial.

(xii) The claimants instructed geographically remote solicitors either before or at the same time as they sought medical advice.’ (paragraph 6).

A very robust pleading!

 I have set out the defence in full so we can actually see what the defendants were alleging on the facts of Howlett:

(a) That the defendants denied that the accident occurred.

(b) That the defendants specifically stated that the second defendant contended that the first defendant was involved in another accident which indicated that the index accident was ‘a staged/contrived accident and injury’.

(c) That the first defendant had been involved in at least four other road traffic accidents.


No allegation of fraud

The defence, however, was careful to row back from specifically alleging fraud, stating that the defendant did ‘not assert a positive case of fraud at this stage’, but required the claimants to ‘prove their case’.

This rather unconvincing suggestion – that fraud was not being alleged – was then followed by the following: ‘Should the court find any elements of fraud to this claim, the second defendant will seek to reduce any damages payable to the claimants to nil together with appropriate costs orders therein’ (paragraph 7).

Although the second defendants were keen not to specifically plead the ‘F Word’ - Fraud – there is absolutely no doubt that the defence did allege fraud and fundamental dishonesty.

The Defence:

(a) Suggested it was a staged accident; and

(b) In support of that contention, suggested that the claimants had already given – a different version of injuries – matters which caused the second defendant to be suspicious.

On any interpretation of the defence in this case, an allegation of fraud and fundamental dishonesty had actually been pleaded. The fact that the word fraud was not used – and the defendants specifically stated that the defendants were not ‘asserting a positive case of fraud at this stage’ is sophistry of the highest order.

Having set out (as any defendant should) the basis of the defendant’s denial, this could not be a ‘put to proofdefence.



On any interpretation, this defence clearly set out that each of the claimants were fraudsters. Furthermore, the defence can only really be interpreted as a positive averment that the claim was fundamentally dishonest. It is difficult to envisage a more straightforward defence than this.


Was dishonesty alleged?

It is clear that the district judge’s judgment confirmed that the district judge treated the defence as an allegation of dishonesty.

At paragraph 16 of the judgment, the district judge confirmed: ‘[Mr Bartlett] has said that [Ageas] has not pleaded a case of dishonesty, nor did he crossexamine on that basis. I have to disagree with him. In my judgment the defence (and I will go into detail in a moment) does make it clear that it is suggesting in the clearest possible terms to the claimants that they have not been honest and that a great deal of what they have written in their evidence is questionable and that those comments in the defence are justified by an analysis of the substantial documentations that has been prepared for the purposes of these proceedings’ (paragraph 13.i).

The district judge was certainly correct; the defence had clearly alleged and pleaded a case of dishonesty.


CPR 16

Even allowing for the fact that (the defendants’ ‘not asserting a positive case of fraud at this stage’) the defence complies with CPR 16.5 in all the following regards: ‘CPR 16.5, to which there is reference in this passage, requires a defendant to identify in his defence which of the allegations in the particulars of claim he denies and, where an allegation is denied, to “state his reasons for doing so” and, “if he intends to put forward a different version of events from that given by the claimant”, to “state his own version”. It can be contrasted with paragraph 8.2 of Practice Direction 16, which provides that a claimant “must specifically set out” in his Particulars of Claim “any allegation of fraud” on which he wishes to rely in support of his claim’ (paragraph 22).


Whilst fraud or fundamental dishonesty were not actually used within the defence, what does it matter?

The true tenor of the defence was that the claimants were fraudsters and that the claims were dundamentally dishonest.

In putting forward positive averments to support the allegations of fraud and fundamental dishonesty, the defendants were quite properly relying upon evidence to prove that the claims were dishonest.

The district judge’s interpretation of the defence

Citing Haringey v Hines [2010] EWCA Civ 111 (paragraph 36, Judgment of DDJ Taylor): “Haringey v Hines [2010] EWCA CIv 111 also dealt with the issue of fraud. It is not an issue I am invited to find in this case, and I will not be using that expression because the importance about the word “fraud” is that it is a legal definition and unless it is something that is specifically pleaded, I do not believe that I have the right or the power to use it in my judgment. People may say that if I come to certain conclusions in this case,“Well, you might as well say that there has been fraudulent behaviour” but I specifically resile from using that expression in this particular case. But the important elements of that case, again, were that allegations that amounted to fraud and dishonesty and deceit were not put, they were not pleaded, but in this case, as I have found, there has been sufficient explanation and description of the allegations made in the defence and in the way the case has been conducted on behalf of [Ageas]’ (paragraph

In other words, the district judge treated the defence as an allegation of fraud and fundamental dishonesty.

Putting on notice

Citing Vogan International Ltd v Serious Fraud Office [2004] EWCA Civ 104, the district judge found: ‘30. I find that there has been every opportunity given to the claimants to defend themselves and to make their case as they see fit’.

In citing paragraph 30 of Vogon: ‘More importantly, however, findings of this kind ought not to have been made when those involved have not been put on notice that they might be and have not been given the opportunity to defend themselves’ (paragraph 13.iii).

Clearly, the pleaded defence in Howlett made it plain that the defendants were suggesting that the accident was fraudulent.


Paragraph 12.4 of practice direction 44

In a case to which CPR 44.16(1) applies: ‘The court will normally direct that issues arising out of the allegation that the claim is fundamentally dishonest be determined at the trial.’ It was suggested that any allegation of ‘fundamental dishonesty’ will have been raised in the pleadings in advance of the trial (paragraph 18).

LVI – a complicating factor

A complicating factor in Howlett was the fact that there was already good authority for defendants to pursue LVI and causation arguments without specifically pleading fraud.

Dealing with Kearsley: ‘It is not, I gather, unusual for insurers to file defences comparable to that put in by Ageas in the present case in response to claims in respect of personal injuries alleged to have been caused by low-speed traffic accidents. Mr Vonberg submitted that the approach that Ageas adopted here followed the guidance given by the Court of Appeal (Brook, Dyson and Carnwath LLJ) in Kearsley v Klarfeld [2005] EWCA Civ 1510. In that case, Brooke LJ, giving the judgment of the court, said that it was “puzzled… by the practice that has started to emerge in low velocity impact litigation of requiring the defence to include a substantive allegation of fraud or fabrication” (paragraph 41). The defendant, Brook LJ explained, ‘does not have to put forward a substantive case of fraud in order to succeed” (paragraph 47): it sufficed that the defendants “set out full the facts from which they would be inviting the judge to draw the inference that the plaintiff had not in fact suffered the injuries he asserted” (paragraph 45)’ (paragraph 20).

With regard to LVI: ‘So long as a defendant follows the rules set out in CPR 16.5 (as this defendant did in [paragraphs 3 and 4 of the defence]) there is no need for a substantive plea of fraud or fabrication. All that is necessary is to make clear that an assertion along the lines of what is now para 6 is based on the assertions in paras 3 and 4’ (paragraph 21 [para 48, Kearsley v Klarfeld]).

The district judge was entirely correct in identifying the defendant did not need to specifically plead fraud and fundamental dishonesty with regard to the LVI/causation issue.

But whether Howlett is authority for the proposition that fraud and fundamental dishonesty does not need to be pleaded absent the allegation of LVI/causation is questionable.


Crucial statements of case

In fact, Howlett reinforces the need for clear and unequivocal defences. The Court of Appeal reinforced the importance of Statements of Case (in this case, the defence). ‘Statements of case are, of course, crucial to the identification of the issues between the parties and what falls to be decided by the court. However, the mere fact that the opposing party has not alleged dishonesty in his pleadings will not necessarily bar a judge from finding a witness to have been lying: in fact, judges must regularly characterise witnesses as having been deliberately untruthful even where there has been no plea of fraud. On top of that, it seems to me that where an insurer in a case such as the present one, following the guidance given in Kearsley v Klarfeld, has denied a claim without putting forward a substantive case of fraud but setting out “the facts from which they would be inviting the judge to draw the inference that the plaintiff had not in fact suffered the injuries he asserted”, it must be open to the trial judge, assuming that the relevant points have been adequately explored during the oral evidence, to state in his judgment not just that the claimant has not proved his case but that, having regard to matters pleaded in the defence, he has concluded (say) that the alleged accident did not happen or that the claimant was not present. The key question in such a case would be whether the claimant had been given adequate warning of, and a proper opportunity to deal with, the possibility of such a conclusion and the matters leading the judge to it rather than whether the insurer had positively alleged fraud in its defence.’ (paragraph 31).

There is quite a lot going on in this paragraph!

First, Kearsley v Klarfeld is good law; a substantive case of fraud does not need to be put forward in respect of an LVI/causation defence. Second, the fact that a defendant has not alleged dishonesty in the pleadings will never stop the Judge from finding a witness or party to have been lying on oath. Third, a statement of case is clearly crucial to the identification of the issues. Fourth, a proper defence should act so as to give ‘adequate warning of, and a proper opportunity to deal with, the possibility of (a finding of fraud or fundamental dishonesty)’.


The adequacy of pleading

Howlett tackles what the purpose of a pleading is. The key question in such a case would be whether the claimant had been given adequate warning of, and a proper opportunity to deal with, the possibility of such a conclusion and the matters leading the judge to it rather than whether the insurer had positively alleged fraud in its defence.’ (paragraph 31).

So Howlett actually reinforces the need for a Defence to give a clear explanation of the basis upon which the defendant denies the claim.

This dovetails exactly with CPR 16.5.

The defence must - if there is disagreement with the claimant’s pleaded case – explain the denial.

Denton Hall v Fifield (2006) EXCA Civ 169

Although this was not dealt with in the Howlett authority, a good example of the way in which the defendant should prepare its defence is to give a clear signal to the claimant of any inconsistent medical record upon which the defendant intends to rely at trial.

Read All About It!

This has been a headline-grabbing authority. At first blush it may now seem to defendants that they are perfectly able to put forward ‘shadowy’  defences only to ambush claimants at trial with serious allegations which, in fact, amount to allegations of fraud and fundamental dishonesty.

However on the facts of Howlett, the second defendants set out a defence which was clear and unequivocal.

My personal interpretation of the defence is that this was clearly an allegation of fraud and fundamental dishonesty.

Although the word ‘fraud’ was not included, the attempt to row back from an allegation of fraud (the Defendant ‘not asserting a positive case of fraud at this stage’) was a tactical decision to avoid the inevitable argument that the defendant had the burden of proving fraud.

In fact, the defendants managed to prove that the claimants were both fraudulent and fundamentally dishonest.


Three Rivers D.C. v Bank of England (No 3) (2001)_ UKHL 16

The House of Lords have been very clear about the responsibility for pleading and particularising fraud. It is well established that fraud or dishonesty must be distinctly alleged and as distinctly proved; that it must be sufficiently particularised; and that it is not sufficiently particularised if the facts pleaded are consistent with innocence. This means that a (plaintiff) (but the writer suggests this applies to claimant or defendant) who alleges dishonesty must plead the facts, matters and circumstances relied on to show that the defendant was dishonest and not merely negligent, and that the facts, matters and circumstances which are consistent with negligence, do not do so’.

Here the House of Lords confirms that an allegation or fraud or dishonesty must be alleged and sufficiently particularised.

There is no obligation to use the word ‘fraud’ or ‘fundamentally dishonest’ if the evidence in support of those allegations is properly particularised.

Which, again, is exactly what the second defendants did in Howlett.

In conclusion, Howlett needs to be treated with great caution. The following points can be made:

(a) It is not an authority that exonerates a defendant from pleading and particularising a defence based on fraud or fundamental dishonesty; in fact, Howlett underscores the need for a claimant to be put on notice in a clear and unequivocal defence.

(b) It seems that the use of the words ‘fraud’ or ‘fundamental dishonesty’ are not essential; the defence in Howlett was clear and unequivocal and the district judge was correct in embracing that defence as a clear and positive case that the claimants have brought a fundamentally dishonesty claim and were, in fact fraudsters.

(c) The fact that a trial judge can find a party or a witness to be dishonest – without any specific pleading or cross-examination – is trite law.

(d) That compliance with CPR 16.5 – which underscores the need for clear and unequivocal Defences – is confirmed by Howlett.

It may well be that Howlett is solid authority for the defendants to ensure that defences give adequate notice to any claimant of a serious allegation, whether the claimant has been fraudulent or that the claim is fundamentally dishonest.

Going forward, where defendants fail to provide such notice, Claimants will be well advised to ensure that clarification of any shadowy defence is obtained through the use of notice to admit facts or request for further information.

No doubt Howlett will also prompt procedural judges to ensure that defences are (as in Howlett) recognised for what they are – irrespective of the use of the ‘F Word’.

Martin Littler is a barrister at Cobden House Chambers, Manchester