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£150,000 Credit Hire Claim Found to be Fundamentally Dishonest


Doglas Da Silva v Martin Mihaylov

In a case handled by Louise Milford of Keoghs Complex Credit Hire team, HHJ Carter held that it was “hard to envisage a clearer case of dishonesty being fundamental to a claim”.

The claimant, a Brazilian citizen, was riding a Honda motorcycle when he was involved in a collision with the defendant’s Volkswagen. The claimant’s case was that the defendant had reversed into him hitting the front of the motorcycle, causing it to fall onto his left leg resulting in personal injury. Liability for the incident was not contested.

Represented by Bond Turner Solicitors, the claimant pursued a claim for personal injury and the pre-accident value of the motorcycle at circa £1,400. In addition, the claimant also sought recovery of credit hire charges incurred with Direct Accident Management Limited for a period of 511 days, totalling £145,870.08. However, at trial, it was conceded that the hire from mid-May 2022 until late November 2022 was not recoverable due to the claimant’s solicitors going “to sleep”. A claim for a damaged helmet was also pursued alongside associate recovery and storage charges.

The claimant was at the time a food delivery driver working for several different companies including Deliveroo and Uber[Eats]. A pleading of impecuniosity was advanced and during the course of litigation, standard “impecuniosity directions” were provided by the court.

Although the matter had initially been allocated to the fast track and listed for one day, the initial trial was adjourned due to insufficient hearing time, reallocated the claim to the multi-track and listed for two days.

During cross-examination, the claimant was asked about his work in Brazil before coming to the UK and confirmed that he had worked as a sales assistant and that he had a bank account in Brazil into which his salary had been paid. That resulted in further questioning during which the claimant confirmed that he had a bank account in Brazil into which money was paid using the Remitly app. The claimant accepted that it was not possible to determine how much money had been transferred to Brazil as neither the Remitly account nor the Brazilian account had been disclosed. Further, the claimant had not disclosed how much was held in that account choosing instead to insist that he had disclosed his UK bank accounts only as he now lived in the UK.

The claimant made an application during the course of the trial for both relief sanction for the failure to provide the Brazilian bank statement and an extension of time to obtain and provide the relevant statements (in the light of the hearing going into a third day). HHJ Carter rejected the same and held that the claimant was wholly inconsistent in his evidence about the Brazilian bank account. There was no explanation as to why this account had not formed part of his disclosure and the HHJ Carter held that the claimant knowingly concealed his Brazilian account.

HHJ Carter also held that the claimant’s responses to difficult questions were also lacking in credibility and overall he was found to be an unconvincing witness. HHJ Carter, therefore, indicated he would treat the claimant’s evidence with a considerable degree of caution.

To that end, it held that the claimant needed a replacement motorbike to work as a delivery driver. The claimant was, therefore, entitled to hire a replacement bike for the period until he was in a position to replace it from his own funds (not being impecunious). This was assessed at a period of 41 days which accounted for the date the vehicle was scrapped. Once applying the applicable BHR to this period, the claim for credit hire was assessed in the sum of £570.

However, given the finding that the claimant knowingly concealed his Brazilian bank account, it was found that the dishonesty went “to the root of a substantial part of the claim”. HHJ Carter was, therefore, satisfied that the defendant had shown on the balance of probabilities that the claimant was dishonest and that his dishonesty was fundamental to the claim and had a substantial effect on the presentation of the claim. The impecuniosity element of the hire claim was not only substantial, but the reason the claim came out of the fast track and into the multi-track. The trial judge even commented that it was “hard to envisage a clearer case of dishonesty being fundamental to a claim”.

Despite this, as the claim for PSLA was not found to be dishonest, a s.57 defence was not engaged. However, owing to the dishonesty finding, the claimant lost QOCS protection and it was ordered that the claimant was to pay 75% of the defendant’s costs of the claim with such costs to be paid on the indemnity basis. There was also no order for costs in the claimant’s favour despite his obtaining a judgment. The order also offset the awarded damages by way of an interim on account of the defendant’s costs resulting in no payment being made to the claimant.

Implications and comment

HHJ Carter’s judgment is another timely reminder as to the importance of forensic examination of financial disclosure sent in support of pleadings to be impecunious. Quite often, when taken at face value, month-end balances offer only a glimpse into the true financial picture of a claimant. A line-by-line review is required to ensure that not only full and frank disclosure has been provided, but also to ensure that a detailed picture of the incoming and outgoing funds is built up to ensure full scrutiny.

HHJ Carter’s judgment offers a welcome and rational review of the relevant authorities concerning fundamental dishonesty in the context of credit hire claims when presented alongside a claim for personal injury. It also serves as a reminder to those pursuing extraordinarily high-value claims that they will be scrutinised and challenged robustly.


For more information, please contact:

Scott Croft, Associate Solicitor

Email: Scottcroft@keoghs.co.uk


Louise Milford, Case Handler

Email: LMilford@keoghs.co.uk

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