Want to talk to an expert employment law solicitor?

You'll receive a callback from a specialist within an hour

redmans-blog-analysisIn the case of Hayward v Zurich Insurance Co Plc [2016] UKSC 48 the Supreme Court held that a settlement agreement that had been entered into between two parties could be set aside due to evidence of fraudulent conduct.

In 1998 Mr Hayward was injured in an accident at work and brought a claim for negligence against his employers. The case was dealt with on the employer’s behalf by its insurers, Zurich Insurance Company plc (“Zurich”). Liability in the case was agreed and the parties reached a settlement agreement in October 2003, shortly before the quantum hearing was due to be held. This settlement agreement stipulated that the employer (in practice Zurich) would pay £134,973.11 in full and final settlement of Mr Hayward’s claims.

In 2005 Mr Hayward’s neighbours (who had moved into their property in 2002) contacted Mr Hayward’s employers to inform them that they did not believe that Mr Hayward was being honest about the state of his injuries, and further informed them that they believed that Mr Hayward had recovered in full from his injuries at least a year before settlement was agreed. They gave witness statements to Zurich to that effect.

In 2009 Zurich commenced proceedings against Mr Hayward, claiming damages for deceit. Zurich argued that Mr Hayward’s witness statements, his statement of case in the Particulars of Claim, and his Schedules of Loss as to the extent of his injury contained fraudulent misrepresentations. The damages that were claimed by Zurich amounted to the difference between what the case had been settled for and what the case would have been worth if Mr Hayward had been telling the truth. The claim was later amended to state that Zurich was looking to set the compromise agreement aside rather than for an order for damages.

The case came to the Cambridge County Court in November 2012, with the Court finding that Mr Hayward had deliberately and dishonestly exaggerated the effects of his injuries during the court process. The judge also found that the settlement agreement had been entered into by Zurich on the reliance of false representations given by Mr Hayward, and that the settlement agreement should therefore be set aside. The judge found that Mr Hayward would have fully recovered from his injuries by October 1999 and handed down a judgment awarding Mr Hayward damages to the sum of £14,720. An order was also given that Mr Hayward must repay Zurich the sum of £136,110.45.

Mr Hayward appealed against the decision of the Court, arguing that the settlement agreement should not have been set aside. The Court of Appeal ruled in Mr Hayward’s favour, finding that Zurich had been aware at the time that the settlement agreement was entered into that Mr Hayward may have been exaggerating the extent of his injuries. Zurich appelaed to the Supreme Court on the grounds that, regardless of whether Zurich had believed in Mr Hayward’s representations regarding the effects of his injuries, it had been induced to enter into the settlement agreement as a result of these fraudulent representations.

The Supreme Court ruled in Zurich’s favour, holding that it was not necessary for Zurich to show that it believed that the (mis)representations made by Mr Hayward were true but that it merely had to show that it had been induced to enter into the settlement agreement by the misrepresentations (i.e. that the misrepresentations were a material cause for Zurich to enter into the settlement) and that these misrepresentations had caused them loss.

Chris Hadrill, a specialist employment solicitor at Redmans, commented on the case: “This is an important judgment by the Supreme Court in both the contexts of personal injury and employment law – if defendants to litigation can obtain clear and cogent evidence that the other side had misrepresented their case then this could lead to a challenge to any settlement agreement reached between the parties.”

The transcript of Hayward v Zurich Insurance Co Plc [2016] UKSC 48 can be found here

About

Redmans Employment Team deal with employment matters for both employers and employees, including drafting employment contracts and policies, advising employers and employees on compromise agreements, handling day-to-day HR issues, advising on restructures, and handling Employment Tribunal cases for both employers and employees Call 020 3397 3603 to speak to one of the members of our employment team or email us on enquiries@redmans.co.uk. Redmans have offices in Richmond, Chiswick, Hammersmith, Fulham, Kingston, Wimbledon, Ealing, Kings Cross and Marylebone (meetings strictly by appointment only).

Tagged with →  

Want to talk to an expert employment law solicitor?

You'll receive a callback from a specialist within an hour

Share →

Our awards

Request a callback

Your name

Your email

Your telephone number

Contact us

Please feel free to discuss your own position and concerns. Contact your nearest office on:

T: 020 3397 3603
E: enquiries@redmans.co.uk
W: www.redmans.co.uk

Testimonials

4.76 Average

172 Reviews

Anonymous

I had an employment issue which required legal advice. Chris was very supportive and knowledgeable, resulting in an optimum resolution in my favour. Would definitely recommend.

Posted 4 days ago

David M

Very professional and first-rate advice. I would use again. With thanks,

Posted 4 days ago

Anonymous

Got the job done swiftly without going too much in to detail.

Posted 4 days ago

Derek W

Redmans dealt with my case very efficiently and I was happy with the outcome.

Posted 6 days ago

Anonymous

Timely professional advice!

Posted 1 week ago

Anonymous

Very good service

Posted 1 week ago

Anonymous

I was in contact with Chris and then worked with Caroline on an employment matter. I was very pleased with the service and professionalism throughout, and came away with satisfied with the outcome. Would happily recommend.

Posted 1 week ago

Nikki

Received advice re employment law. Chris was very helpful and advised accordingly. Would happily recommend them and if ever I need help again, will not think twice before using them.

Posted 2 weeks ago

Samantha K

Absolutely brilliant thank you. Caroline Lewis is a legend

Posted 2 months ago

Anonymous

The legal advice was clear and helpful.

Posted 2 months ago

Davinder P

Good Service

Posted 2 months ago

Adrian V

I was using Redmans services for a Settlement Agreement. Very quick and professional service. The outcome was favourable and I was very pleased with the amendments and results. Pretty glad to recommend them for any type of legal advice.

Posted 2 months ago

Anonymous

Very responsive, efficient, clear and supportive. Thank you! Highly recommend.

Posted 2 months ago

Tiago S

Chris was always prompt to help me with legal matters that are beyond my comprehension and very helpful leasing with my former employer. I would recommend Redmans Solicitors to everyone who needs help.

Posted 2 months ago

Anonymous

Fast and professional advice tailored to what was needed. Thanks for your help Chris Hadrill and team.

Posted 2 months ago

Peter S

Really pleased with the outcome and the advice I had from Chris and Sacha.

Posted 2 months ago

Harika A

Redmans solicitor's helped me with my settlement agreement, Chris has been very helpful throughout the process.He was very prompt in his responses and made my settlement look simple.Special thanks to Caroline for her efficient communication, thorough explaination of contract terminology and negotiations.I highly reccommend Redmans solicitors for anyone seeking employment related legal help.

Posted 2 months ago

Anonymous

Good and quick service

Posted 2 months ago

Ricky D

Very satisfying to be assured of such attention and professionalism.

Posted 2 months ago

Anonymous

Excellent service - thankyou

Posted 2 months ago

Anonymous

Efficient, timely and friendly support and advice

Posted 2 months ago