Kanu v Kashif

Undisclosed earnings are not automatically excluded from a claim for loss of earnings. The court must consider the circumstances and relevant public policy. A claimant who deliberately concealed earnings from the Benefit Agency, while claiming Income Support, could not recover damages for earnings which he would have continued to deny receiving. The public policy against allowing recovery based on dishonest conduct was relevant, although the broader proposition that all undisclosed earnings are irrecoverable was rejected.

The claimant was injured in a road accident. Liability was agreed at 75 per cent against the other driver and 25 per cent against the claimant. At a quantum-only trial, the judge awarded general and special damages but refused loss-of-earnings damages because the claimant had concealed his earnings while receiving Income Support.

Permission to appeal was limited to that refusal. The Court of Appeal heard the merits before deciding whether to extend time for setting down the appeal and concluded that the appeal had no merit. The central issue was whether earnings concealed from the Benefit Agency could support a claim for future loss of earnings.

1. The appeal was dismissed. It was unnecessary to determine the application for an extension of time because the merits of the appeal were hopeless.
2. Lord Justice Waller held that it was too broad to state that undisclosed earnings can never form the basis of a damages claim. The decision depends on the circumstances and the applicable public policy considerations.
3. On the facts, the claimant had deliberately committed fraud on the Benefit Agency by concealing earnings while claiming Income Support. The evidence supported the judge’s finding that, absent the accident, the claimant would have continued receiving the earnings while representing that he had none.
4. The claimant could not rely in the damages claim on earnings which he would have continued dishonestly to conceal. The public policy considerations recognised in Hunter v Butler [1996] RTR 396 were relevant, although the present case differed from the dependency claim considered there.
5. The reasoning in Newman v Folkes, where undeclared earnings were not treated as an absolute bar to recovery, did not assist the claimant because the circumstances were materially different. Lord Justice Laws agreed with Lord Justice Waller. The formal order was: appeal dismissed.

• Court of Appeal (Civil Division): The appeal from the quantum decision of HHJ Hordern QC in the London County Court was dismissed.