The recent case of UK Insurance Ltd v Gentry  EWHC 37 (QB) demonstrates how the Court will evaluate circumstantial evidence in the absence of direct evidence of fraud. It also considers when an adverse inference can be drawn against a witness who fails to give evidence.
The insurers of Mr Miller, an allegedly negligent driver, made a payout of £14,000 to Mr Gentry after he claimed he had been hit in a collision.
The insurance company later conducted an investigation which suggested Mr Gentry and Mr Miller knew each other before the incident. Suspicions were raised about whether the accident had been genuine.
The insurance company brought an action against Mr Gentry for deceit, alleging that the incident had been staged for financial gain. Mr Gentry denied any wrongdoing. He initially maintained that the parties had become friends after the accident, however in his Defence he accepted that he did know Mr Miller beforehand. He said the friendship had been concealed so as not to slow down the claim, which was genuine.
Mr Justice Teare noted that “in order to discharge the burden of proof the Claimant must be able to exclude any substantial, as opposed to fanciful or remote, possibility that the collision was genuine. The court must have a very high level of confidence that the Claimant’s allegation is true.”
The Claimant called its solicitor and investigator to give evidence.
Mr Gentry called Mr Voller to give evidence. Mr Voller was said to have been a passenger at the time of the incident and he confirmed Mr Gentry’s version of events. He said it was not apparent that the drivers knew each other at the time of the collision. The Judge later commented that this was “inconceivable” and decided that Mr Voller was an unreliable witness.
Mr Gentry did not give evidence himself. The Claimant asked the Court to draw an adverse inference from the Defendant’s silence and pointed to the guidance set out by the Court of Appeal in Wisnewski v Central Manchester Health Authority  PIQR P324. The Judge was persuaded by the Claimant’s argument: Mr Gentry had material evidence on a key issue and no satisfactory reason was put forward for his failure to give evidence. The Judge said there was “a cogent argument for inferring that he did not give evidence because he feared that he would not be able to give an account of the collision which withstood cross-examination.” Therefore the Judge said that the Defendant’s silence strengthened the Claimant’s case.
The Judge noted that there was no direct evidence of fraud and so it could only be inferred from circumstantial evidence. He considered the contemporaneous paperwork in relation to the vehicles and the fact that the drivers had concealed their friendship. He said, “Of course it is possible for two friends to suffer a collision when driving their respective cars. It would however be a striking and unlikely coincidence. Another explanation for the collision is that the two friends had staged the collision; that would explain the apparent but unlikely coincidence.”
Overall the Judge was satisfied that there was cogent circumstantial evidence that the collision was staged. Judgment was awarded in favour of the Claimant for almost £20,000 along with interest and costs.
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