Resisting Allegations of Fundamental Dishonesty in Credit Hire

November 27, 2023

by Jack Scott


Defendants in credit hire cases seem to be increasingly citing the case of Haider v DSM Demolition Ltd [2019] EWHC 2712 (QB) in order to allege Claimants are Fundamentally Dishonest because of issues with their disclosure. As such, this is an opportune time to revisit the case and its implications.


A road accident led to claims for personal injury and substantial credit hire. The Claimant pleaded impecuniosity in his witness statement, which was verified by a statement of truth.

Before trial, the Claimant had also signed a disclosure statement, verified by a statement of truth, which did not disclose any credit cards. The Defendant asked the Claimant various Part 18 questions about his bank accounts, in which he confirmed his current accounts and, again, stated he had no credit cards.

First Instance

At trial, the Claimant accepted that the cheque paid by the Defendant for damage to his vehicle did not appear in the bank statements he had disclosed. He accepted he had another bank account, but said it has been opened in error. He also accepted he had two credit cards which he had not disclosed.

The Defendant submitted the Claimant had not been honest in his disclosure. The Circuit Judge criticised the Claimant’s driving and dismissed the claim, finding the Defendant was not negligent. The Judge determined that there had not been “particularly good disclosure” but that did not lead him to conclude the Claimant was dishonest as the inconsistencies could be explained by the difficulty of recalling events four years later. On that basis, he declined to find the Claimant fundamentally dishonest.


Both parties appealed: the Claimant on the judge’s finding of liability; the Defendant appealed the judge’s decision not to find the Claimant fundamentally dishonest.

Julian Knowles J dismissed the Claimant’s appeal on liability. However, he found for the Defendant on the question of fundamental dishonesty and overturned the trial judge’s decision.

He noted that the Part 18 questions were not complicated, were sent in writing and the Claimant had time to take legal advice before giving his answers. It was also held that the Claimant’s explanation of a bank account being opened in error was not credible.

As such, on appeal it was found the Claimant had two bank accounts and two credit cards, whose existence he had purposefully concealed. It was held that there was no basis for the trial judge to conclude the Claimant was confused or mistaken – he could only have been dishonest.

The Court held that this dishonesty was “fundamental” and went to the root of the claim (which was worth over £30,000), concluding:

  1. The importance of the Claimant giving proper disclosure about his financial circumstances needs to be emphasised. Part of the purpose of a statement of truth is to bring home to party signing the solemn nature of what s/he is doing, and importance of telling the truth. To knowingly give a false statement of truth is a contempt of court: CPR r 17.6(1). Moreover, as the Defendant correctly observed in its Skeleton Argument, the County Court cannot carry out an assessment of the issue of impecuniosity when a litigant fails to give full financial disclosure. By doing as he did, the Claimant prevented the Defendant from carrying out a proper investigation into his claimed impecuniosity. This skewed and distorted the presentation of his claim in a way that can only be termed fundamentally dishonest.
  2. It follows that the judge was wrong not to have concluded (per CPR r 44.16(1)) that the claim was not fundamentally dishonest so as to allow the order for costs made against the Claimant to be enforced to its full extent.


Defendants have increasingly used this case to suggest a Claimant who has failed to comply with their disclosure obligations has been fundamentally dishonest.

However, The case of Haider can be distinguished from most other credit hire matters in four important ways:

  1. Most failures of disclosure fall down for not covering the whole of the required period, rather than concealing a bank account or credit card altogether. Here, the Claimant had signed a disclosure list and answered Part 18 questions; both were verified by statements of truth. These confirmed he had no other bank accounts and no credit cards at all. That was plainly wrong and the Claimant must have known that. Claimants who make a single genuine mistake in their disclosure are likely to be viewed less harshly.
  2. The Claimant’s oral evidence was that it was the bank’s mistake for erroneously opening another account in his name. This was not accepted by the Judge. Most Claimants will hold their hands up to any gaps in their evidence and take responsibility for them, rather than advancing “fanciful” stories.
  3. The Claimant did not correct his erroneous earlier evidence by way of a further witness statement. Of course, the impact of such a correction can’t be known, but it seems that doing so could only have helped his position.
  4. Usually, the Court has already set out the sanction a Claimant will face for incomplete or erroneous disclosure; they will be debarred from establishing impecuniosity. The Court Orders giving directions do not highlight the risk of a finding of fundamental dishonesty. It follows that some additional step (such as asserting a fact known to be untrue) should occur for a further sanction to be applied. Reasonable mistakes should lead to proportionately reasonable sanctions.
  5. Fundamental dishonesty had been properly pleaded (and was a live issue at trial). It remains the case that many Defendants seek to “keep their powder dry” and do not put their case in an appropriately clear way to Claimants.


The judgment of the appellate court underlines the seriousness with which documents verified by statements of truth are to be viewed and a possible risk to Claimants who fail to comply with disclosure requirements.

However, on closer inspection, it seems Defendants shouldn’t take too much comfort from this decision. This was a very specific case with several unusual features; it has limited application to most Claimants if the right submissions are made.