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K v B, Court of Appeal

18 March 2003
The issues

Memorandum of understanding – understating claim – Small Claims Track – road traffic.

The facts

The Claimant had a road traffic accident involving the Defendant. As a result, the Claimant’s vehicle had to be repaired and the cost was £755.89. That cost was paid by Insurers accept for the excess of £125.00. The two respective Insurers had a memorandum of understanding and accordingly the claim was issued in respect of the excess and miscellaneous expenses only totalling £155.73 in all. The District Judge ordered the Claimant to file Particulars giving the “true value” of the claim, i.e. including the costs of the vehicle repairs. The Claimant refused to do so and the claim was struck out on the basis that litigants were not permitted to understate claims to minimise costs. The Defendant appealed and the decision was transferred to the Court of Appeal.

The decision

1. Nothing in the CPR obliged the Claimant to include all the claims he might advance against the Defendant.

2. The Court had no power to increase the value of a claim or to include items, which the Claimant did not include.

3. There was no distinction between subrogated and non-subrogated claims.

4. There was nothing contrary to the overriding objective or the interest of justice in what the parties had agreed to do. If the under-valuing of the claim meant that an otherwise complicated claim was likely to be tried in the wrong track, the Court had jurisdiction to allocate it to a different and appropriate track.

Appeal allowed and claim reinstated.

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