Hayward v Zurich Insurance Company Plc
| Jurisdiction | England & Wales |
| Judge | Lord Neuberger of Abbotsbury,Baroness Hale of Richmond,Lord Clarke of Stone-cum-Ebony,Lord Reed,Lord Toulson |
| Judgment Date | 27 July 2016 |
| Court | Supreme Court of Judicature |
| Date | 27 July 2016 |
SUPREME COURT
Before Lord Neuberger of Abbotsbury, Baroness Hale of Richmond, Lord Clarke of Stone-cum-Ebony, Lord Reed, Lord Toulson
In a claim for deceit based on fraudulent misrepresentation it was not necessary for the claimant to show that he believed the misrepresentation to be true when he acted upon it to his detriment.
The fact that insurers did not wholly believe the extent of the alleged injuries in a personal injuries claim when they entered into a settlement agreement did not preclude them from seeking to rescind the agreement when the true facts were subsequently disclosed.
The Supreme Court so held, allowing the appeal of the insurer, Zurich Insurance Co plc from a decision of the Court of Appeal (Lord Justice Underhill, Lady Justice King, Lord Justice Briggs)([2015] EWCA Civ 327) which allowed the appeal of the claimant, Colin Hayward, from a decision of Judge Maloney, QC, sitting at Cambridge County Court on September 6, 2013, granting the insurers rescission of a settlement agreement to pay the claimant £134,973 in full and final settlement of a claim for damages for personal injuries sustained in an accident at his work place.
Mr Patrick Limb, QC and Ms Jayne Adams for the insurers; Mr Guy Sims for the claimant.
LORD CLARKE, with whom Lord Neuberger, Lady Hale and Lord Reed agreed, said the settlement agreement had been made shortly before the issue of quantum was due to be tried. The employer's case had been conducted on its behalf by its liability insurer.
In 2005 the claimant's neighbours, who had lived next door to him since June 2002, approached the employer to say that they believed his claim to have suffered serious back injury was dishonest. From their observation of his conduct and activities, they believed that he had recovered in full from his injury at least a year before the settlement. They were referred to the insurers and made full witness statements.
The judge found that the claimant had deliberately and dishonestly exaggerated the effects of his injury throughout the court process and that although the insurers were aware at the time of the settlement of the real possibility of fraud, the claimant's continuing misrepresentations had influenced the insurers into agreeing a higher level of settlement than it would otherwise have done.
The judge therefore set aside the compromise, and having found that the claimant had made...
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