A personal injury firm that led a claim without taking instructions has been referred to the police by a judge and ordered to pay full costs.

Ruling in Dickson v NFU Mutual Insurance Services at Carlisle County Court, His Honour Judge Peter Hughes QC said that it appeared that a number of criminal offences may have been committed through Preston firm Barber & Co. The firm said it welcomed any investigation. 

These included fraud in making a false claim for compensation, forgery of a medical report and engaging in acts tending to pervert the course of justice. Hughes directed that copies of his judgment be supplied to the Lancashire Police and the Crown Prosecution Service.

The firm has said it is disappointed by the costs decision but welcomes the potential police investigation and chance to clear its name.

The firm had made a personal injury claim against insurer NFU Mutual Insurance Services Limited, following a 2011 accident involving a car and a tractor.

In July 2012, proceedings were issued on the claimant’s behalf by the Greater Manchester firm Mellor Hargreaves, along with a medical report. By that date, NFU had already agreed to settle with Barber & Co, for £1,125 on a split liability basis.

The judgment stated that it was accepted by Barber & Co that the claimant was never its client, the firm had no authority to act on his behalf, and that a medical report supporting the claim was a forgery.

Judgment was eventually entered for the claimant in the sum agreed between NFU and Mellor Hargreaves on behalf of the claimant for £2,750.

For the purposes of a hearing held in May, NFU had applied to join Barber & Co to the case for the purpose of costs. The court heard that in March the firm had applied to join two former employees, neither of who is a solicitor. Hughes refused to grant Barber & Co’s application.

The court heard that Arif Barber, the principal of the firm, and Yasin Bagas, a solicitor employed by the firm, are due to appear before the Solicitors Disciplinary Tribunal in September. Both deny allegations including failing to supervise unqualified fee earners and allowing false documents to be created.

Hughes said the former employees had left the firm by January 2013, by which time a letter had been received from Mellor Hargreaves regarding the claim. The judge said he would have expected anyone remaining at the firm to be ‘outraged’ on discovering the fraud committed in its name.

‘What is abundantly clear, though, is that Barber have constantly stalled and obfuscated, and have failed to assist those acting for the claimant and the defendant to resolve the position,’ said Hughes. ‘This has materially delayed the resolution of the claim and added significantly to the costs.’

The judge said the firm was ‘evasive’ and its response to enquiries was ‘reprehensible and cannot be condoned’. He held that Barber & Co should pay the costs of both main parties on an indemnity basis.

Paul Wainwright, head of counter fraud at Browne Jacobson, which acted for the defendant, said the judgment sends a message to claimant firms turning a ‘blind eye’ to fraudulent activities. I believe this sets a precedent, but more importantly provides a powerful deterrent, which will be widely adopted by the counter-fraud community to stop such practices.

In a statement released today, Barber & Co said: 'The firm is obviously disappointed with the outcome of the case which revolved around two non-qualified fee earners creating false documentation and representing client(s) without proper instructions.

'The firm fully co-operated with the SRA when they initially investigated the matter in July 2015 and the SRA with the information Barber & Co had available to them reached the outcome that they would not be investigating the matter any further, at that time.

'The matter was then investigated further by Mellor Hargreaves by interviewing the medical expert, whose report was purported to be forged. This was not communicated to Barber & Co until 9 March 2016 and the firm were only brought into proceedings in November 2016.

'The firm have fully co-operated with the SRA. The primary regulatory allegation against the firm relates to a lack of supervision of [two former employees] not any misappropriation of funds by Barber & Co. The firm are delighted with the referral of the judgment to the police by His Honor Judge Hughes and welcomes any investigations in order to exonerate the firm.’