Insurer Allowed to Resile from Admission of Liability after the Value of the Claim Increased

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30 June, 2017

Kieran Blake v (1) Dominic Croasdale (2) Esure Insurance Ltd (2017)[2017] EWHC 1336 (QB)

In this unusual case, the Court allowed the Defendant to withdraw its admission of liability in the interests of justice as the value of the claim had increased significantly and because the Defendant sought to argue ex turpi causa (i.e. the claim has arisen from illegal or immoral conduct).

The Claimant and Defendant had been involved in a RTA. The First Defendant driver had driven on the wrong side of the road during a police chase and collided with another car, the Claimant was travelling as a rear passenger in the First Defendant's car. The driver of the other vehicle was killed. The Claimant suffered severe brain injury and the First Defendant was convicted of causing death by dangerous driving.

A claim was submitted on behalf of the Claimant via the Ministry of Justice portal. The Insurer admitted primary liability for the accident subject to contributory negligence as the Claimant had not been wearing a seat belt and the driver had consumed drugs. The Insurer offered £100,000.

A further medical report was obtained and the claim was valued at between £3-5 million. Proceedings were issued and the defence pleaded that the Claimant's injury had been caused by his own criminal act, as he had been involved in a joint criminal enterprise as a drug dealer with the First Defendant. The Insurer applied to withdraw its admission of liability to enable it to plead the defence of ex turpi causa.

The Claimant submitted that there was no realistic prospect of the ex turpi causa defence succeeding and defended the application to resile from the admission of liability.

The Court allowed the Defendant to resile from the admission of liability, the Court held that whilst the material which enabled the Insurer to raise the defence of ex turpi causa had been available from an early stage, it could not have imagined that it was facing a multi-million pound claim when the Claimant's solicitors had started it within the portal. The Judge found that there would be prejudice to the Insurer if it was not allowed to rely on the defence.

Forbes comment

An admission of liability is binding and can only be withdrawn by consent or with the permission of the Court. Whilst in this instance the Court did allow the Defendant to resile from the admission because the value of the claim had increased significantly, the Judgment suggests that the intention to argue ex-turpi causa was a key factor in the decision.

For more information contact Sarah Wilkinson in our Insurance department via email or phone on 01254 662831. Alternatively send any question through to Forbes Solicitors via our online Contact Form.

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