Jet2holidays has won a landmark Court of Appeal ruling in an ongoing fight against fake sickness claims which has wide implications for the travel and insurance industry regarding taking action against fraud.
The UK’s second largest tour operator is able to take contempt proceedings forward after a Court of Appeal ruling confirmed that the High Court has jurisdiction to commit for contempt of court where false statements verified by a statement of truth are submitted by a potential claimant, even though no formal claim for damages is ever issued.
The case paves the way for companies to take action against dishonest claimants, even if they do not actually submit legal proceedings.
Jet2holidays had issued contempt proceedings against Karl and Laura Hughes from Nottingham, after they brought a claim against Jet2holidays for gastric illness following a holiday to Lanzarote in 2016. The couple alleged that they had contracted food poisoning as a result of eating contaminated food, and served witness statements verified by a statement of truth detailing the extent of their illness in April 2017. They later withdrew the claims prior to formal proceedings being issued.
After uncovering evidence that undermined these claims, including Facebook and Twitter posts, and 45 minutes of GoPro footage on YouTube showing Mr Hughes enjoying a snorkelling-trip despite claiming to be ill, Jet2holidays issued contempt proceedings.
His Honour Judge Owen QC at the High Court originally struck this out as he held that the High Court had no jurisdiction to deal with the committal proceedings. Jet2holidays appealed that decision and the Court of Appeal held unanimously that the High Court did have jurisdiction to commit for contempt of Court, and it was sufficient that statements had been served in the pre-action protocol phase.
The Master of the Rolls, Sir Terence Etherton, Lord Justice Hamblen and Lord Justice Flaux, heard the appeal and summed up as follows: “A dishonest witness statement served in purported compliance with a PAP (Pre Action Protocol) is capable of interfering with the due administration of justice for the purposes of engaging the jurisdiction to commit for contempt because PAPs are now an integral and highly important part of litigation architecture … we consider, contrary to the view of Judge Owen, that there was a close connection between the original witness statements made by the respondents and the administration of justice and that, if those witness statements were false, as appears strongly to be the case, they interfered with the administration of justice.”
Jet2holidays was also awarded costs of its appeal, and the landmark decision means that the company’s original contempt proceedings against Mr and Mrs Hughes can now progress.
Steve Heapy, CEO of Jet2.com and Jet2holidays, said: “Jet2holidays continues to lead the way in the fight against fake sickness claims, and this landmark decision shows that the courts take this issue very seriously. The decision by the Court of Appeal to allow us to progress with contempt proceedings against Mr and Mrs Hughes, despite no legal proceedings being issued, has wide reaching implications not only for tour operators dealing with false sickness claims, but the insurance industry in general.
“The ruling send should send a warning to others. If documents are found to contain false information, contempt of court proceedings can and will be brought, even when the claimants have decided not to commit to legal proceedings.
“Jet2holidays has led the way in stamping out fake claims made for gastric illness and we will continue to investigate and defend any claims that are dishonest or illegitimate.”
An ABTA spokesperson said: “This landmark decision won by Jet2holidays, which allows companies to take action against dishonest claimants even if they do not actually submit legal proceedings, sends a clear message to any customers considering a fraudulent claim that the consequences for doing so can be very severe. Following on from previous court cases where fraudulent claimants have received a criminal record, substantial fines or a prison sentence, this important case should help ensure only genuine claimants embark on and pursue claims for compensation, which is welcome news for the industry.”
Commenting on the landmark ruling, Ronan McCann, managing partner at Horwich Farrelly, the law firm representing Jet2holidays, said: “This is a truly landmark ruling in the fight against fraudsters. Often fraudulent claims are submitted by solicitors on the basis that if they are rejected the fraudster does not have to issue proceedings and submit a claim elsewhere so is not exposed to any risk. This case confirms that this is no longer the case. If a fraudster is willing to submit such claims, even if they do not litigate, they are now exposed to a prison sentence. The days of submitting risk-free fraudulent claims are well and truly over.”