‘Substantial Injustice’: Don’t worry, you’ll know it when you see it

Published: 23/06/2022 | News


On 20th June 2022, Julian Knowles J handed down judgment in Steven Lee Woodger v Reece Hallas [2022] EWHC 1561 (QB), the latest case to grapple with the operation of s. 57 of the Criminal Justice and Courts Act 2015 (“s. 57”) and, in particular, the meaning of “substantial injustice” as set out in s. 57(2).

Whilst perhaps understandable, his Lordship continued in much the same vein as he did in LOCOG v Sinfield, by refusing to provide any clear-cut guidance on the meaning of those all-important two words, instead assuring practitioners that county court judges will generally ‘know substantial injustice when they see it’.  The facts and the first instance decision in Woodger perhaps neatly demonstrate that his Lordship’s expectations might not always materialise…



The Claimant was a front seat passenger in a vehicle being driven by the Defendant when the car was involved in a serious RTA; the Defendant lost control of the car which spun, before being hit square on the passenger side, at speed, by a car which had been travelling in the opposite direction.  The Defendant’s insurers admitted liability for the accident.

The Claimant sustained extensive and serious injuries and he complained of continuing problems in his right hip including pain and limitation of movement, which he asserted had been and remained at trial, debilitating in terms of his daily activities and his ability to undertake his pre-accident work in the motor trade as a mechanical and electrical car repairer.

The Defendant alleged that the Claimant was dishonestly exaggerating his claim.  The Defendant’s focus was on the Claimant’s complaint of right hip symptoms. The Defendant had commissioned surveillance which showed the Claimant, at a time when he was complaining of substantial disability and an inability to earn, at a local garage on a number of occasions, moving relatively freely and involved in some work under the bonnet of cars and during one lengthy sequence, working on his back underneath a vehicle apparently doing some welding.  The medico-legal experts agreed, having seen the footage, that it showed a significantly greater range of movement in the right hip than the Claimant had allowed either expert to elicit on examination.

In addition, the Defendant called evidence from a witness, Mr Godfrey of NRCS, who confirmed that the Claimant had done a substantial amount of work for his company over a period of 2 years, involving servicing (and similar activities) of motor vehicles, for which the Claimant had been paid something in the region of £12,000 a year, cash in hand.  There was also evidence that the Claimant had then gone on to work for another company, KAMS, where he was also paid.

In his Schedule of Loss, the Claimant advanced claims, inter alia, for past loss of earnings, future loss of earnings (£481,000 – essentially for the rest of his life); future care and assistance (£15,000); future treatment (nearly £3000); and future DIY (around £26,000).  All those claims were effectively abandoned not long before trial in light of the disclosure of surveillance evidence.


First Instance Decision

HHJ Godsmark Q.C. found for the Claimant and awarded him £49,415 in damages.  The Judge also found that the Claimant had been fundamentally dishonest in relation to his claim within the meaning of s. 57(1).

The Claimant’s dishonesty lay in the fact that he had sought to exaggerate the effects of his injury when seen by the experts; he had undertaken paid work with NRCS and had attempted to ‘pull the wool’ over the Judge’s eyes in relation to his remuneration with KAMS; he had concealed income; and although the Claimant did suffer with hip pain, he had exaggerated the level of disability it caused.  The Judge found that the assertion that the Claimant was not capable of earning as a mechanic was central to his claim and his concealment of earnings, which would undermine or fundamentally destroy that element of the claim, went to the root of the claim as a whole.  The Judge found that the Claimant had been dishonest about his earning capacity, and that represented the bulk of his claim.

However, the Judge refused to dismiss the claim under s. 57(2) on basis it would be ‘substantially unjust’ to do so.  He held that there were elements of the claim which remained sound and uncontaminated by the Court’s findings in relation to earnings; that the injuries were serious and had continuing effects; and that there was an element of the claim brought on behalf of innocent parties who had provided care and assistance to the Claimant.

The Judge instead dismissed all aspects of the claim which were founded on a lack of earning capacity – namely the past loss of earnings claim and the claim for handicap on the open labour market.



The Defendant appealed on the basis that the Judge was wrong to find that there would be ‘substantial injustice’; he should have dismissed the whole claim.

The judgment of Julian Knowles J contains an excellent and pithy summary of the current law relating to s. 57 at [6] – [15], including a brief commentary on the background to s. 57’s enactment.


His Lordship noted his own earlier observations in LOCOG in relation to “substantial injustice” in which he had said at [65] that,

[G]iven the infinite variety of circumstances which might arise, I prefer not to try and be prescriptive as to what sort of facts might satisfy the test of substantial injustice.  However, it seems to me plain that substantial injustice must mean more than the mere fact that the claimant will lose his damages for those heads of claim that are not tainted with dishonesty.  That must be so because of s. 57(3).   Parliament plainly intended that sub-section to be punitive and to operate as a deterrent […] It seems to me that it would effectively neuter the effect of s. 57(3) if dishonest claimants were able to retain their ‘honest’ damages by pleading substantial injustice on the basis of the loss of those damages per se.  What will generally be required is some substantial injustice arising as a consequence of the loss of those damages”.


In short – the mere loss of the genuine/honest element of the claim would not be enough to establish ‘substantial injustice’.

 His Lordship also noted that in Iddon v Warner [2021], HHJ Sephton QC (sitting as a High Court Judge) had agreed with that formulation at [98] [a case in which the fundamentally dishonest Claimant had used a large interim payment to purchase a house which she would need to sell in order to repay the monies owed, and which the Court found was insufficient to amount to ‘substantial injustice’].


Arguments on Appeal

The Defendant argued that there was nothing on the facts of the case to warrant a finding of ‘substantial injustice’ and the mere loss of damages to which the Claimant would have been entitled were his claim not fundamentally dishonest could not amount to ‘substantial injustice’ on its own (relying on LOCOG and Iddon).  It was also argued that ‘substantial injustice’ could not arise on account of those who had afforded the Claimant care because their position was not contemplated under s. 57(2).  It was highlighted that the Claimant’s conduct had been sustained over a five-year period and across several statements of case and Schedules of Loss; he had given perjured evidence at trial; he had sought to convince others to give false evidence as well [having asked Mr Godfrey to sign a witness statement confirming that although the Claimant had worked for NRCS, he had not been paid]; and in addition there was irrecoverable cost and waste of court time.

The Claimant argued that the Judge’s reasons for finding ‘substantial injustice’ were sufficiently clear.  The Claimant’s case on appeal was advanced on the basis that ‘substantial injustice’ was present due to (a) the severity of the Claimant’s injuries; (b) the lasting consequence and permanence of the injuries; (c) that there had been third party care given to the Claimant; and (d) the need for the Claimant to see justice done against the Defendant who had caused the injuries.  The Claimant also argued that a Judge who had found fundamental dishonesty but not dismissed the whole claim had power under s. 57 to dismiss elements of the claim as a matter of discretion even if the Claimant had genuinely proved an entitlement to those damages.



Julian Knowles J held that the Judge should have dismissed the whole claim – there was no proper or adequate basis for the finding that it would be ‘substantially unjust’ to do so.

His Lordship observed that the starting point is that s. 57 only comes into play where the Claimant is entitled to some damages; thus in every case where the court finds fundamental dishonesty, ex hypothesi, the Claimant will stand to lose their genuine damages; that was what Parliament had provided for in express terms, subject to there being ‘substantial injustice’ (at [43]).  He also reiterated that ‘substantial injustice’ “must mean something more than the Claimant losing their genuine damages” (at [44]).

He held that the Judge’s reasoning for finding ‘substantial injustice’ could not stand.  The Judge had given two reasons for finding ‘substantial injustice’: first, because part of the claim was genuine – that finding was in conflict with LOCOG and Iddon and the “plain purpose of s. 57”; secondly, because others had provided care to the Claimant – that finding was “difficult to reconcile with s. 57(2) which makes clear it must be the Claimant – and not anyone else – who would suffer substantial injustice” (at [45]).

No authority was put before the Court which defined ‘substantial injustice’ which his Lordship was not “wholly surprised by…” and he commented that, “county court judges will generally “know it when they see it” (at [49]).



The outcome at first instance would strike many as unsustainable and the result of the appeal is undoubtedly correct.

However, as observed in the introduction, the High Court has, once again, refused to provide any tangible test or meaningful guidance on what constitutes ‘substantial injustice’.  Whilst one can perhaps understand the Court’s reticence to do so given the open textured nature of the phrase and the innumerable circumstances in which such an argument might arise, it continues to be somewhat frustrating given the facts and initial outcome in Woodger demonstrate that the concept of ‘substantial injustice’ is being applied in a non-uniform way, sometimes resulting in untenable and unexpected results which necessarily give rise to further time and costs inherent in the consequential appeals.  Given the High Court has now had a number of opportunities to provide more robust guidance on this issue, it seems fair to assume that it will continue to decline to do so.


A number of interesting points do arise from Woodger:

i)    The Court has reiterated that the mere loss of the honest/genuine part of the claim is, in and of itself, insufficient to amount to ‘substantial injustice’ (although that fact seemed tolerably clear from the wording of s. 57(3) and the decision in LOCOG);

ii)    His Lordship noted that in Iddon at [103], HHJ Sephton Q.C. had approached the question of ‘substantial injustice’ by balancing on the one hand, the nature and extent of the dishonesty, and on the other the injustice of dismissing the whole claim. At [48], Julian Knowles J adopted (and therefore it appears tacitly approved) that ‘balancing exercise’ when considering whether ‘substantial injustice’ is made out; and

iii)    In relation to HHJ Godsmark Q.C.’s finding that ‘substantial injustice’ was established he, inter alia, relied on the fact that the Claimant had received care and assistance from third parties. Julian Knowles J rejected that approach as affording a proper basis for finding there would be ‘substantial injustice’.  It is not clear from the judgment whether the High Court was referred to the decision of HHJ Melissa Clarke (sitting as a High Court Judge) in Patel v (1) Arriva Midlands Limited; (2) Zurich Insurance PLC [2019] EWHC 1216 (QB), but its conclusion would appear consistent with HHJ Clarke’s view at [95].


The Court declined to decide whether HHJ Godsmark Q.C. had the power under s. 57 to reduce the Claimant’s damages as he did – namely dismissing all aspects of the claim relating to the dishonestly advanced case on lack of earning capacity.  That point was left open to be determined in a case where it properly arises (at [53]).  Such an argument raises an interesting point; it is tentatively suggested that no such power arises under s. 57 and that the effect and intention of the statute is to dismiss the entirety of the claim, including all genuine elements, and that it does not afford a power to dismiss, on a piecemeal or selective basis, only those heads of loss directly relatable to the proven dishonesty.  Such an approach would seem contrary to the wording of the statute.  Moreover, the importation of a ‘discretion’ is problematic – it is contrary to the clear intention of s. 57, the mischief at which it is directed, and its recognised punitive intent; plus it leaves uncertain the scope of, and limits on, the exercise of any such discretion.   Such issues may require further ventilation at appellate level in due course.

In the meantime, practitioners have to simply hope that first instance Judges will ‘know substantial injustice when they see it’… making advising on such issues wholly straightforward for everyone!


Jake Rowley is a member of the Farrar’s Building Personal Injury and Civil Fraud Teams.  Jake has a particular interest and expertise in cases involving allegations of dishonesty and is the author of “Fundamental Dishonesty and QOCS in Personal Injury Proceedings: Law and Practice”.  Jake frequently delivers training, seminars and workshops upon request.  For any further information, or to instruct Jake, please contact the Farrar’s Building Clerking Team.