Recorder’s ruling law firm party to fraud without allowing it to rebut allegation overturned

The High Court ruled Mr Recorder Osborne, who sits in Manchester County Court “was not entitled to make a conclusive finding of dishonesty or fraud against MRH and they should be treated as not having such a finding made against them”.

Mr Recorder Osborne gave a judgment ex tempore following a four-day trial in which he dismissed a personal injury claim as well as consequential losses on the grounds the motor accident was staged and the claims made in respect of it were fraudulent.

He found the solicitors, who represented the claimant driver, were party to the fraud in addition to Apex Hire UK and Pennington Legal, which had supplied him with the hire cars.

None of these persons were party to the proceedings or were warned such findings might be made and the findings were made even though the defendant had expressly disavowed the possibility of fraud.

Mr Justice Nicol, sitting with Lord Justice Burnett in MRH Solicitors Ltd v The County Court Sitting at Manchester & Ors EWHC 1795 (Admin) agreed with Julian Knowles QC, for MRH, that the Recorder would have been justified, so long as the evidence merited it, “to voice his suspicions or concerns as to the conduct of MRH, but noting that he had not heard anyone from MRH give evidence…

“What… he should not have done in fairness to MRH was to make positive and unqualified findings that the solicitors had been fraudulent and dishonest.”

Nicol J said that while he understood why the Recorder was suspicious “in the absence of good reason a judge ought to be extremely cautious before making conclusive findings of fraud unless the person concerned has at least had the opportunity to give evidence to rebut the allegations. This is a matter of elementary fairness.”

The High Court made the same ruling in respect of Apex and Pennington but said the Recorder had not made as explicit a finding regarding them.