A North Yorkshire couple have been sentenced to jail for a total of 12 months after being found guilty of a combined 26 grounds of contempt of court for making fraudulent personal injury claims. The claims amounted to around £2.2 million between the duo and were defended by Horwich Farrelly (HF), representing KGM Underwriting Services (KGM).
The case involved a collision that occurred in June 2014. KGM’s insured had collided with a pony and trap being ridden by Sarah Smith and led by Mark Smith, with liability being swiftly admitted. The couple suffered injuries, which for Mark Smith included a significant leg fracture, as well as a broken arm and jaw.
Their claims included a significant loss of earnings claim for Mark Smith, who was said to earn £50,000 a year as an engine builder. However, investigations undertaken in the first four weeks of instruction revealed that his business was essentially an online scam and that he paid no tax.
Surveillance over three years showed that Mark Smith was much more able than he claimed, according to a release from HF, while Sarah Smith had effectively recovered.
The couple claimed state benefits. In the case of Sarah Smith, her benefits were stopped so she appealed the decision of the DWP in November 2017. HF inspected her benefits documents and found that she had submitted a false doctor’s report to support her appeal. Moreover, this report was submitted just six days after she received a suspended prison sentence in November 2017 for fraud and attempting to pervert the course of justice in conjunction with Mark Smith.
As for the loss of earnings claim, Mark Smith produced accounts for two years that had been drawn up by an accountant that were revealed to be fraudulently prepared.
In May 2019, the defence was amended to plead fundamental dishonesty, which caused the Smiths’ solicitors to cease to act. The Smiths persisted with their claims, leading to an eight-day trial in December 2021 before His Honour Judge Mark Gargan.
In a reserved judgment handed down in April 2022, the Smiths’ claims were dismissed on the basis that they were fundamentally dishonest. The couple was ordered to pay KGM £100,000 on account of their costs.
Following the ruling, KGM instructed HF to bring committal proceedings against the pair as they still protested their innocence and wished to appeal the decision. However, they ultimately admitted 26 grounds of contempt and were handed immediate custodial sentences.
Mark Smith was sentenced to eight months’ imprisonment. Sarah Smith’s sentence was halved to four months, being the primary caregiver to their four children under seven years old.
“This was a challenging case which we defended for over seven years,” said HF partner Andrew Baker. “The combination of early and repeat surveillance, coupled with early background checks on the claimants, with a focus on documentary evidence was the couple’s undoing.”
Baker said most claimants faced with the same amount of evidence compiled against the Smiths’ would have discontinued their case, but the two refused to accept any responsibility for the “significant problems” exposed in their claims.
“When pressed at trial, they sought to blame their relatives or/and their ‘greedy lawyers’ who were supposedly motivated by being in line to receive 20% of the damages by way of a CFA success fee,” he added. “Ultimately such dishonesty has been proven not to pay – something the Smiths can now spend the next few months reflecting upon.”
A spokesperson for KGM also commented on the outcome of the case and praised the “firm approach” that the court took in sentencing the Smiths.
“Both Mark and Sarah Smith doggedly maintained their dishonest claims in the face of the overwhelming evidence our lawyers gathered which clearly demonstrated that the claims were either entirely false or massively inflated,” the spokesperson said.
“KGM strive to offer our customers motor insurance at a competitive price, so it’s important that we do not allow dishonest claimants to pursue spurious or inflated claims. Equally, we recognise the need to properly compensate victims of accidents which were not their fault. The irony for Mr and Ms Smith is that recognising the injuries they suffered, we offered them appropriate compensation back in 2015 which they chose to reject in their seven-and-a-half-year quest for a windfall they were never entitled to.”
KGM was represented by HF Solicitors and Paul Higgins of Crown Office Chambers, London.
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