Harrison Bryce Solicitors v Shamaj: Distinguishing accident genuineness from claim honesty

The High Court has dismissed an appeal by Harrison Bryce Solicitors Limited against a county court decision refusing its counterclaim for fees and disbursements, clarifying the distinction between proving an accident was genuine and establishing that a damages claim was honest.

Following a road traffic collision in December 2019, Mr Shamaj instructed Harrison Bryce under a conditional fee agreement. During trial preparation, concerns emerged about the claim's authenticity, prompting the firm to terminate the retainer in March 2022. When the claim was subsequently struck out for non-payment of the trial fee, Mr Shamaj sued for professional negligence. Harrison Bryce counterclaimed for approximately £11,000 in fees and disbursements.

Recorder Armstrong dismissed both the negligence claim and the counterclaim. Whilst finding Harrison Bryce had breached its duty by failing to advise about the trial fee, he concluded Mr Shamaj could not have honestly pursued three of five claimed heads of loss, meaning no substantial chance of recovery existed. Critically, however, he also found insufficient evidence that Mr Shamaj had deliberately misled the firm.

The appeal

Harrison Bryce appealed solely against dismissal of the counterclaim, arguing the Recorder failed to distinguish between accident genuineness and claim honesty. Relying on Perrys v Raleys Solicitors [2019] UKSC 5, the firm contended that once the Recorder found most of the claim "demonstrably false", he should have concluded that deliberate misleading had occurred.

Mrs Justice Dias rejected this argument on multiple grounds. Firstly, contrary to the appellant's submissions, the Recorder had explicitly considered whether Harrison Bryce was misled regarding the damages claim, separate from whether the accident was staged. The judgement demonstrated awareness that genuine accidents can give rise to dishonest claims.

Burden of proof

A key issue concerned the burden of proof. Harrison Bryce argued that Perrys v Raleys established that claimants must prove their claims would have been honest. Mrs Justice Dias disagreed, holding that Lord Briggs's comments in that case concerned a claimant proving loss of chance in a professional negligence action, not a defendant's counterclaim alleging deliberate misleading.

The contractual terms required proof that Mr Shamaj had "deliberately" misled the firm—tantamount to fraud. Where a party makes such an allegation, it must prove it. The burden of establishing deliberate misleading was distinct from Mr Shamaj's burden of proving his claim could have been honestly pursued for loss of chance purposes.

Factual findings

Harrison Bryce contended that Mr Shamaj's continued adherence to his damages claim through two subsequent witness statements, despite demonstrable falsity, made deliberate misleading inevitable. However, Mrs Justice Dias noted various unexplored circumstances, including the role of a claims management company and whether statements were taken in Mr Shamaj's first language. The Recorder, having heard four days of evidence, was best placed to assess whether misleading was deliberate or arose from misunderstanding.

The Court emphasised that finding a claim could not honestly be pursued does not automatically establish deliberate misleading. Misunderstandings or miscommunication could produce the same result without fraudulent intent.

Procedural postscript

Mrs Justice Dias identified a potential alternative basis for the counterclaim—contractual entitlement to expenses and disbursements following justified termination—but declined to determine this point as it fell outside the grounds of appeal for which permission had been granted.

The appeal was dismissed, reinforcing that appellate courts should be reluctant to disturb trial judges' factual findings, particularly regarding witness credibility and deliberate conduct.