Aviva Insurance Ltd v Ahmed

This is an application for the committal of the defendant, Mr. Rashid Ahmed, for contempt of court. The application is brought with permission granted by Nicol J on 15th March 2017. Permission was granted because it is in the public interest that allegations of contempt as serious as this should be heard and dealt with, if proved. The allegation is that the defendant brought a fraudulent claim in the county court for personal injuries alleging that he had been the victim of a genuine road traffic accident when in fact he had deliberately caused the collision in order to make a fraudulent claim. The contempt alleged consists of making false statements in documents verified by a statement of truth. The application is brought by Aviva Insurance Limited, whom I shall refer to as "the insurers".

The defendant, Mr Ahmed, has not attended the hearing. There were problems effecting personal service and on 3rd May 2017 the insurers were given permission to effect service by postal delivery. That was done. He has been served with notice of today's hearing.

I am satisfied that the defendant has deliberately refused to engage in these proceedings ever since his dishonesty was uncovered. For reasons which I shall explain in more detail later in this judgment I was satisfied that it was appropriate to proceed with this hearing in his absence.

The defendant lived in Luton. He alleged in his county court claim that he was involved in a three-vehicle road traffic accident on the afternoon of 24th June 2014 on the A505 in Luton. Fortunately, the collision itself and the all-important build up to the collision, were captured on CCTV so there can be no doubt as to what really happened. The three vehicles were all travelling in the southbound dual carriageway in the offside lane. The front vehicle of the three was the defendant's blue Vauxhall Astra; behind him was a silver Vauxhall Corsa driven by Mr. Jai Tailor; behind the Corsa was a large Mercedes Sprinter van driven by Mr. Stuart Barrow. Aviva, were the motor insurers of Mr. Tailor and thus liable to set aside any judgment against him arising out of the collision.

There is no dispute that as all three vehicles were travelling effectively in convoy, in the offside lane. The defendant’s Astra braked sharply. Mr. Tailor was unable to pull up in time and his Corsa collided with the rear of the Astra. In turn, Mr. Barrow's van collided with the rear of the Corsa. In other words, it was a three-vehicle shunt.

Mr. Ahmed alleged in his witness statement and in his particulars of claim that he was travelling at about 20 to 25 mph. He said he could see the traffic building up in front and began to reduce his speed when he was travelling at no more than about 10 mph. He felt and heard a sudden bang and was immediately jolted forwards and violently thrown back in his seat. After the initial collision he felt a second impact. The insurers’ case is that this account is completely untrue.

The evidence of the other two drivers is that prior to the collision the defendant had driven at speed on the nearside of the Corsa and the van, overtaking both vehicles on the inside. He then cut in sharply in front of the Corsa. He travelled normally for a time and then suddenly and without warning slammed on his brakes for no good reason. There was no traffic in close proximity in front of him and there was no build up of traffic approaching the roundabout which was, in any event, some 300 meters ahead. The insurers’ case is that the defendant deliberately caused the collision for the purpose of making a fraudulent compensation claim. This is a species of motor insurance fraud known as a "semi-staged accident" or "induced accident" or "slam on fraud".

The driver of the Corsa, Mr. Tailor was injured and his vehicle was badly damaged. There was also damage caused to Mr. Barrow's van.

Mr. Ahmed issued proceedings in the county court against Mr. Tailor. The particulars of claim were verified by a statement of truth dated 2nd December 2014. He alleged that the collision was caused by the negligent driving of Mr. Tailor. He claimed to have sustained an injury to his neck with referred pain to both shoulders, relying on a medical report from a general practitioner dated 4th August 2014. He claimed special damages totalling just under £1,600 and loss of use of the vehicle. The particulars of claim asserted that he expected to recover not more than £5,000 including an amount for personal injury exceeding £1,000.

On behalf of Mr. Tailor the solicitors acting for insurers served a defence and counterclaim taking issue with Mr. Ahmed's description of the collision, asserting that he had overtaken on the inside and braked heavily and that although Mr. Tailor performed an emergency stop he could not avoid a collision.

Mr. Ahmed made a witness statement verified by a statement of truth dated 10th August 2015, I have already summarised the main points. He also said that after the collision he and Mr. Tailor got out of their vehicles. Mr. Tailor was angry. Mr. Ahmed asked him to calm down. They started taking pictures of the vehicle damage and of the scene. There was a police station opposite and two police officers came and asked them to move the vehicles to the side of the road. A crime reference number was obtained but there was no follow up by the police.

Mr. Ahmed described his injuries. He said he noticed a pain in his neck the following day and it lasted for several weeks. He recovered after about six months. He detailed his alleged losses as pleaded in the schedule of special damage and he exhibited various documentation. He was 29 years old at the time of the collision and employed part-time as a security guard.

Witness statements were also filed from the driver of the Corsa, Mr. Tailor, dated 28th August 2015 and from the driver of the van, Mr. Barrow, dated 30th November 2015. Mr. Tailor confirmed what he had said in his initial witness statement for the insurers dated 13th July 2014. He said in that statement that the traffic was busy and slow moving, it was start, stop. The car came up on his inside and cut in front of him very sharply. The driver started to gesticulate in an aggressive manner. Shortly afterwards he saw a red flash, which must have been the brake lights of the Astra ahead. He made an emergency stop but could not avoid the collision. It was a heavy impact. He was thrown forward in his seat. His car was then immediately struck in the rear.

When he got out he could see that there was a passenger in the Astra. He asked Mr. Ahmed why the Astra had stopped as the road in front was clear. Mr. Ahmed's response was that it was an emergency stop because of his friend. Mr. Tailor had no idea what he meant by that. I should add that Mr. Ahmed in his own witness statement said that he had a friend in the car with him whom he was proposing to drop off at the friend's home nearby. I note, however, that he did not name the friend in his witness statement.

Mr. Tailor was already suffering from symptoms in his neck and back as a result of a previous road traffic accident. This collision exacerbated his symptoms. He was off work for a while and was unable to return to playing hockey for the rest of the season. His vehicle was written off.

The other driver, Mr. Barrow, said in his witness statement that from his elevated position in the van he could see that the carriageway ahead was clear with no obstructions. He saw the Astra overtaking him on the inside and then pulling in front of the Corsa sharply. Very soon after that the Astra stopped suddenly for no reason causing the Corsa to collide with it. Mr. Barrow was unable to stop in time and collided with the rear of the Corsa.

Whilst he was parked at the scene a gentleman from Luton Town Council approached him. He explained that he was a CCTV operator working for the council. He said that the incident had been captured on CCTV and he would keep a copy in case anyone needed it.

The claim was allocated to the fast track to be heard during the period November 2015 to January 2016. There were further directions, including an order that Mr. Barrow be joined in the proceedings. The trial window was put back to March/April 2016 with a time estimate of one day. On 5th January 2016 Mr. Ahmed's solicitors applied to come off the record as representing him. By now the CCTV evidence had been served. The inference is that his solicitors felt they could to longer act for Mr. Ahmed in what was plainly a dishonest claim. Their application to come off the record was granted.

Now acting in person, Mr. Ahmed was required to return the listing questionnaire and pay the hearing fee of £545. He failed to do so. On 2nd February 2016 an order was made that unless he complied with those requirements by 9th February his claim would stand struck out without further order. He did not comply with those requirements but despite that the claim seems to have proceeded and further standard directions were given. The case was provisionally listed for trial on 20th June 2016.

On 27th April 2016 further directions were given. The court noted that the claimant, Mr. Ahmed, was now a litigant in person and had played no active part in the proceedings since his former legal representatives were removed from the court record as acting for him. The court directed that if he failed to attend the hearing on 20th June the court would deal with the issue of fundamental dishonesty in his absence. The case was to remain in the list for 20th June for that purpose.

On 7th June 2016 a further unless order was made against Mr. Ahmed allowing him until 14th June to file the listing questionnaire and pay the hearing fee. The insurers' solicitors corresponded with Mr. Ahmed at his home address in Luton reminding him that his attendance was required at the hearing on 20th June and that if he failed to attend, the court would be invited to draw an adverse inference.

The hearing on 20th June went ahead. The insurers appeared by counsel. The district judge found that the claimant was fundamentally dishonest for the purposes of CPR 44.16(1). This rule provides that orders for costs made against a claimant may be enforced to the full extent of such orders with the permission of the court where the claim is found on the balance of probabilities to be fundamentally dishonest. The district judge so found and ordered the claimant to pay the insurers’ costs in the sum of £10,463.

The present application for permission to apply for committal was issued on 28th February 2017.

The relevant procedural provisions in relation to committals for contempt of this kind are set out in CPR Part 81 and in the accompanying practice direction, PD 81. The rules are procedural only. They do not themselves confer on the court the power to make any order for committal. That power derives from the inherent jurisdiction of the High Court. The form of contempt alleged here is governed by section 6 of Part 81. CPR 32.14(1) provides:

" Proceedings for contempt of court may be brought against a person if he makes, or causes to be made, a false statement in a document verified by a statement of truth without an honest belief in its truth."

This provision did not make any change to the law of contempt, see Malgar Ltd v RE Leach (Engineering) Ltd [1999] EWHC 843 (Ch); [2000] FSR 293. It is still necessary in addition to prove knowledge that what was said and done was likely to interfere with the course of justice.

It is alleged here that the defendant made four false statements, each verified by a statement of truth. They are detailed at paragraph 6 of the affidavit of the insurers’ solicitor, Mr. Philip Morris, dated 22nd February 2017. The allegations are:

In short, therefore, it is alleged that these statements gave a deliberately false version of the circumstances of the collision, asserting that the defendant had a legitimate reason to slow down and did so in an ordinary and reasonable way, whereas in fact he had deliberately slammed on his brakes with no traffic in front of him, well before the roundabout and with no queuing traffic ahead.

The statement of truth in respect of the claim form, at (1) above was signed not by the defendant himself but, perfectly properly, by an employee of his solicitors, duly authorised by the defendant. In those circumstances, although technically it was still a statement made or caused to be made by the defendant and verified by a statement of truth, I propose to make no finding on that allegation. In any event it adds nothing to the other three.

It follows that the insurers must prove, in order to establish each contempt:

The defendant has completely failed to engage with these proceedings ever since his solicitors came off the record in early January 2016. It is necessary to recite the history of the correspondence with him. In March 2017 the insurers’ solicitors attempted to effect personal service of the application for permission to apply for committal and a supporting bundle, as the rules require. A process server visited the defendant's address at 105 Highbury Road, Luton on 10th March, 14th March and 21st March. He could obtain no reply. On one of those visits he could hear someone inside but no-one would answer the door. There had already been similar unsuccessful attempts to serve the defendant personally with a bankruptcy petition in December 2016 arising from the costs order

In view of these difficulties an application was made to the Master for permission to effect service of the claim form and supporting documents for the committal by postal delivery, pursuant to CPR 6.15(1) and 81.14(2), and for an order that service be deemed to have been effected on 19th April 2017 following personal delivery and that further service of the claim form be dispensed with pursuant to CPR 6.16. In support of that application Mr. Philip Morris of the solicitors made a statement dated 13th April 2017 from which I have summarised the evidence in relation to attempts at personal service. Master Davison duly made an order in the terms sought on 3rd May 2017.

On 12th June 2017 the insurers’ solicitors wrote to the defendant at the same address informing him that permission had been granted for the committal application. The relevant bundle was served again, together with the order for permission and the order allowing personal service. The letter included the following warning:

"We strongly recommend that you seek legal advice on receipt of this letter (you may be entitled to legal aid). Your liberty is at stake if you fail to engage with ourselves and the court."

On 18th September the insurers’ solicitors wrote to the defendant again at his Luton address including notice of today's hearing and repeating the recommendation that he should seek immediate advice. That letter was returned marked, "This person no longer lives at this address. Please return back to sender"

On 9th November 2017 the insurers’ solicitors wrote to the defendant again at the same address informing him of the listing today and enclosing the bundles. This time the letter warned him that if he failed to attend the hearing he may be convicted and sentenced in his absence and strongly recommended that he should seek legal advice immediately. That letter has not been returned.

Finally, on 16th November the insurers’ solicitors wrote to him again reminding him of today's hearing and warning him that if he failed to attend, the case may proceed in his absence and adverse inferences may be drawn from his failure to attend. The recommendation to seek independent advice was repeated. That letter was sent by post not only to his known address at 105 Highbury Road but also to other addresses in Luton with which the insurers had discovered that the defendant is associated, namely 107 Highbury Road, 95 Highbury Road and 143 Kingsway. There has been no response to any of the letters.

The fact that some of the letters were returned in this way does not, of course, mean that it is true that the defendant no longer lived at the address. I proceed on the basis that there is no reason to think that he has not received the most recent documentation served upon him at four separate addresses to which he is linked, no response having been received. All the indications from the history of the proceedings are that he is avoiding coming to court. In these circumstances I have to consider whether to adjourn the proceedings or whether to proceed in his absence.

Contempt proceedings are quasi-criminal. It is, therefore, appropriate to have regard to the principles which a judge in the Crown Court would apply in deciding whether to proceed with a trial in the absence of the defendant. These principles are conveniently summarised in R v. Jones [2003] 1 AC 1. The relevant factors which the court should consider are:

I have also had regard to the helpful checklist suggested by Cobb J in such circumstances in Sanchez v Oboz [2015] EWHC 235 (Fam) derived in part from R v. Jones, namely:

Mr. Lemmy, on behalf of the insurers, invites me to proceed in the defendant's absence and he addressed each of the points in the check list in turn. I have considered carefully all those points and the relevant matters which fall to be considered before deciding whether the case can proceed in the absence of a defendant in circumstances such as these.

Applying all the relevant principles, I am satisfied that the defendant has been served with the relevant documents, including notice of today's hearing. He has had sufficient time to prepare for the hearing. No reason has been advanced for his non-appearance. It is reasonable to conclude that the defendant knows of and is indifferent to the consequences of today's hearing proceeding in his absence. An adjournment will not be likely to secure his attendance or facilitate his representation. He is not seriously disadvantaged in not being able to give an account of events, bearing in mind the conclusive nature of the CCTV evidence. The insurers would be prejudiced by any further adjournment because more costs would be incurred with little prospect of recovering them. I am quite satisfied that in the interests of justice, and in accordance with the overriding objective, it is appropriate to proceed with this application in the defendant's absence.

But for the CCTV evidence this would have been a classic case of a small claim for personal injuries arising from a road traffic collision in which there were conflicting accounts from the drivers of the vehicles involved and the court was left to assess, as best it could, whether on the balance of probabilities the claimant had proved the collision was the fault of the other driver, in running into him.

The CCTV evidence changes all that. I repeat that as matter of inference its disclosure must be what prompted Mr. Ahmed's solicitors to come off the record. The relevant CCTV footage has been put onto two DVD disks. There is footage from two cameras on opposite sides of the road. Stills from the recordings have been printed out and helpfully marked up to illustrate the key features. The CCTV recordings have been examined in great detail by a properly qualified expert, Mr. Andy Wooler, managing director of Acuity Forensics Limited, who has provided a report dated 22nd February 2017. There was also a witness statement dated 8th November 2017 from Mr. James Hughes, an employee of the solicitors, who is an intelligence analyst experienced in this sort of work. He analysed the CCTV footage and prepared the stills in the form of a "storyboard".

I have watched the DVD footage many times and have studied the stills and the storyboard analysis. I am entirely satisfied that this evidence establishes beyond any doubt whatsoever that the account of the lead up to the collision and of the collision itself given by Mr. Ahmed is false.

The CCTV coverage does not begin far enough back along the road to confirm that the Astra driven by Mr. Ahmed overtook the Corsa and the Mercedes van on the inside and then cut in sharply in front of the Corsa. However, that is the evidence which the drivers of both the Corsa and the van have always given and their account of the collision itself is confirmed by the CCTV evidence.

The CCTV evidence does, however, confirm very clearly and independently that immediately before the collision there was no traffic immediately ahead of the Astra which would in any way have required Mr. Ahmed to brake sharply. Despite this, the Astra is seen on CCTV to brake very sharply indeed and come to a complete stop just before the collision. The Corsa, travelling at a reasonable distance behind, brakes sharply to attempt to avoid colliding with the Astra. It strikes the Astra which is already stationary. The Mercedes van travelling behind in turn stops sharply but is unable to avoid colliding with the Corsa, shunting it forward again into the rear of the Astra.

It follows that I am sure and satisfied to the criminal standard of proof that each of the three allegations of making a false statement is proved. This was not an accident at all but a deliberately contrived collision. The collision was not caused by the negligent driving of Mr. Tailor but by the deliberate act of the defendant in braking sharply in order to cause a collision. The defendant was not driving his vehicle along Dunstable Road in slow moving traffic. The traffic was not building up ahead of him requiring him to reduce his speed. He was not still travelling at a slow speed when the collision occurred. His car was stationary.

Next, the insurers have to prove that the statement, if persisted in, would have been likely to interfere with the course of justice in some material respect. I am sure and satisfied to the criminal standard of proof that this element is also proved. This was a false statement on the central issue of how the collision occurred which the defendant wanted the court to accept as truthful and act upon.

Finally the insurers must prove that at the time each statement was made by the defendant he had no honest belief in the truth of the statement and knew that it was likely to interfere with the course of justice. I am sure and satisfied to the criminal standard of proof, that this element is proved as well. The defendant must have known when he brought this claim and signed his witness statement that this was a fundamentally dishonest claim because he had deliberately caused the collision himself. It was not an accident at all. He must have known that in making these false assertions he was dishonestly interfering with the course of justice by seeking to persuade the court to accept as truthful an account which he knew to be false.

I have considered whether to adjourn the proceedings before passing sentence to enable the defendant to have a further opportunity to appear and address me, with or without legal representation, before dealing with him for these serious contempts which have been proved. In view of the nature of the contempt, the history of the case and the attitude which the defendant has shown to these proceedings, I see no purpose in adjourning any further with all the inconvenience and additional expense and delay that would inevitably be involved. I shall therefore proceed to sentence.

The seriousness of contempts of this kind has been emphasised on many occasions by the senior courts, notably by the Divisional Court in South Wales Fire and Rescue Service v. Smith [2011] EWHC 1749 (Admin). False and lying claims undermine the administration of justice in a number of serious ways. Insurers have to spend a great deal of time and money identifying and weeding out claims they think may be fraudulent. False claims damage our whole system in this country of adversarial justice, depending, as it does, on openness, transparency and honesty. The courts have made it very clear that those who make false claims and are caught out must expect to go to prison. There is no other way to underline the gravity of such conduct and deter those who may attempt to make such claims. There is no other way to improve the administration of justice.

I am satisfied on the evidence of the solicitor acting for the insurers that this type of fraud is particularly difficult to detect and prove. That is because a collision of this kind, deliberately contrived in order to make a false claim for damages, mimics the commonest form of genuine road traffic accident, a rear end shunt. It was only the chance availability of CCTV coverage at just this point on the road which led to the detection of the fraud in the present case. The need to investigate suspected fraudulent claims like this hinders the efficient disposal of honest claims, leading to delay and expense.

As illustrated by the present case, in a contrived collision there is also the risk of injury to the innocent driver of the vehicle behind, who is given no opportunity to avoid the collision when the fraudulent driver slams on his brakes for no reason other than to cause a collision. Fortunately on this occasion the injuries sustained by the driver in the following car were not serious. That was pure good fortune. There could have been far more serious consequences. As it was, there was damage caused to both the other vehicles. Substantial costs were awarded against the defendant, in excess of £10,000 which will almost certainly go unrecovered. The defendant has already been made bankrupt on the application of the insurers in an attempt to recover those costs.

There is no mitigation of a guilty plea nor even any acknowledgment by the defendant of this wrongdoing. The most that can be said is that following disclosure of the CCTV evidence he did not attempt to brazen it out at trial.

In the decisions of the senior courts in passing or upholding sentences for contempts of this kind, a distinction has been drawn between cases on the one hand where there was a genuine claim and the dishonesty and lies exaggerated the effect of the injuries, and on the other hand cases like this where the whole claim was contrived. That distinction was recognised and emphasised in particular in Liverpool Victoria Insurance Company v. Bashir [2012] EWHC 895 (Admin) when the Divisional Court made it clear that cases in the latter category, such as this, are far more serious. That case involved a completely contrived and fictitious collision which had never taken place at all and involved an elaborate conspiracy. It was therefore an even more extreme example of such a fraud. The Divisional Court said that in such cases sentences in excess of twelve months' imprisonment may be appropriate because the fraud is so difficult to detect and appears to be so widespread. In the event much shorter sentences were passed in that case because the defendants had admitted their guilt and co-operated in the wider investigation.

A recent example of a contrived claim is AIG Europe Limited v. Bernard Parmar (unreported) 23rd August 2016 where a sentence of twelve months' imprisonment was imposed. In that case, however, a contrived claim had been pursued to trial, although the defendant did admit his contempt.

I have no information about the defendant's circumstances in the present case, except that he is now 32 years old and that he claimed to be working as a part-time security guard at the time of the accident and as a warehouse operative at the time he made his witness statement a year later in August 2015. I bear in mind that once the CCTV evidence had been disclosed and the solicitors ceased to represent him the defendant did not seek to pursue his fraudulent claim any further. I also bear in mind that the claim was for a modest sum of compensation, less than £5,000.

Nevertheless, this was serious dishonesty which strikes at the very foundation of the civil justice system and needs to be marked by a deterrent sentence. I also bear in mind the risk of serious injury which any contrived collision of this kind may cause to innocent members of the public. That risk does not flow directly from the act of contempt in making false statements once the proceedings were under way, but the underlying dishonesty of a deliberately contrived collision is aggravated by that risk.

In all the circumstances the least sentence that I can pass is one of nine months' imprisonment which I impose concurrently on each of the three counts of contempt. The effect is that, as with any other prison sentence, the defendant will serve halfof that sentence in custody under current arrangements before he is entitled to be released.

A committal warrant will issue forthwith. If and when the defendant is arrested he will be taken into custody. He will of course have the opportunity to purge his contempt and seek earlier release and will be entitled as of right to appeal against the findings of contempt and the sentence I have imposed.

I direct that the insurers must commission an expedited transcript of this judgment which must be served on the defendant at the earliest opportunity.