When a man claimed more than £250,000 from his employer in respect of injuries to his back as a result of an accident at work, the employer’s insurance company took a keen interest in the claim.
Firstly, it opposed the claim on the basis of expert medical testimony that the effect of the accident was not the cause of the man’s injury as such, but acted to exaggerate a pre-existing medical condition, which, had the accident not occurred, would in any event have caused the lack of mobility and other symptoms he suffered in due course. The expert witness instructed by the claimant’s solicitors disputed this.
The insurer did not stop at obtaining expert medical evidence, however. It also obtained covert video footage of the man, which showed that as he approached the spinal clinic for an outpatient appointment, his symptoms worsened and he started to use a stick and walk with a limp.
An offer of compensation was made, but this was considerably less than the amount sought and was rejected by the claimant.
When a joint report was produced by the experts, a revised offer was made. This represented an increase over the original offer, but was still nowhere near the sum originally claimed.
The offer was accepted, however, andthe question of the allocation of the legal costs then had to be decided. The claimant argued that he was the ‘winner’ because the original offer had been increased. Under British law, the ‘loser’ usually pays all or most of the winner’s legal costs. The insurer argued that it had ‘won’ because the eventual settlement was far closer to its original offer than to the amount claimed and that it was right that it should be considered to have won on the basis that the claimant had misrepresented and exaggerated his symptoms. However, the insurer’s application was not successful. It had been in possession of the crucial video evidence before making its first offer and had subsequently made a higher offer. The claimant was therefore the ‘winner’ and the insurance company had to cover his costs in full.
The courts are taking an increasingly strict position as regards offers to settle litigation, and whoever ‘loses’ when the final settlement is compared with the offer will normally have to pay the legal bill. The case shows both the wisdom of making a realistic offer in the first place and the wisdom of accepting a realistic offer.
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Partner Note
Fox v Foundation Piling Ltd. [2011] EWCA Civ 790.