Pleading involvement in a claims-farming scheme -  where there is no law against it… Pleading involvement in a claims-farming scheme -  where there is no law against it…

Pleading involvement in a claims-farming scheme - where there is no law against it…

20 February 2020 | Compulsory Third Party (CTP)
Tags CTP

In a decision before a District Court Master, an SA CTP insurer made an application to amend the Defence to plead that the plaintiff participated in a “claims farming scheme”.

The definition of the “claims farming scheme” used at the hearing was taken from the SA CTP Regulator’s website. It was suggested that a claims farming scheme is members of the public receiving cold-calls or social media prompts seeking personal details regarding possible involvement in a car accident. The claims farming entity then passes on the personal details to lawyers.

The proposed amendments to the Defence suggested that the plaintiff had been cold-called and thereafter treatment received did not relate to the collision but to the plaintiff and her solicitors participating in a claims farming scheme.

As in many of these claims, there are GP visits following the collision where the plaintiff makes no mention of the collision or that it had caused the plaintiff injury. After unsolicited contact by a claims farming entity and/or solicitors the plaintiff claims injury and attends a GP seeks treatment.  

The agent for the NSW solicitors argued that the proposed amendments were akin to alleging fraud and that allowing the amendments would force the appointment of new solicitors.

The insurer argued that the amendments were not akin to fraud but rather were intended to put the plaintiff on notice that there will be an attack on her credibility at Trial.

In allowing the amendments, the Master agreed that the amendments would give fair notice of the credibility issues that the defendant will agitate at Trial.

We watch and await the outcome of this matter and other similar matters that are progressing through the Court process in SA.   

Nightingale & Anor v Miles SADC [2019] 65

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Fiona Brady

Fiona Brady

Principal