A grandmother who claimed more than £750,000 from taxpayers after falsely stating she could only shuffle downstairs on her buttocks because of a fall was jailed today in a landmark blow against "compensation culture".

Barbara Fari, a mother of 13, sued Homes for Haringey on the grounds that her life had been “drastically altered” after she tripped on a paving stone in Hornsey in May 2008 and hurt her knee.

But she was today sentenced to three months in prison after High Court judge Mr Justice Spencer found her in contempt of court for grossly exaggerating the impact of the accident.

The judge said she had behaved in a "thoroughly dishonest" way, but had been "caught out" and must be punished to set an example of other potential cheats.

He added: "The courts have made it clear that those who make false claims and are caught out must go to prison. There is no other way to underline the gravity of such conduct and deter those who would make such claims."

He added: "False and lying claims undermine the administration of justice in a number of serious ways."

The judge agreed, however, to "stay" her prison sentence until 29th November to allow Mrs Fari to lodge an appeal.

Mrs Fari's husband Piper, who was also found to be in contempt of court, but escaped immediate custody and was instead given a two month prison sentence suspended for 12 months.

The ruling was hailed as a victory in the battle against Britain’s “compensation culture” and could pave the way for other fraudulent claimants to be jailed.

The Faris' lawyer, Mohammed Bashir, claimed that although the family had a "difficult background", the couple were "good people" who were trying to keep their sons on the "straight and narrow"and that prison was "wholly the wrong option" for them. He said the Faris, who do not work, live off income support, and were legally aided for today's case, were also "truly sorry" for what they had done and now felt unable to look people in the face.

The judge rejected his plea, however, and said he had no option but to pass a short custodial sentence on Mrs Fari, who is 60 tomorrow.

He also said that he would be awarding costs of £100,000 against the Faris, although he added that this was significantly less than the actual expense of the case.

The judge also highlighted the role of media coverage of the case, saying that it highlighted to the public the consequences of such misconduct.

Homes for Haringey’s solicitor, Jennifer Harris of Plexus Law, welcomed the prison sentence imposed on Mrs Fari.

“This is a stark warning to anyone tempted to exaggerate a personal injury claim. It is not just their compensation they risk losing but also their liberty," she said.

“The courts have sent a consistent and strong message at every stage of these proceedings – fraudulent behaviour will not be tolerated.”

Today’s sentencing follows several days of hearings which culminated with Mrs Fari and her husband being found in contempt of court for grossly exaggerating the impact of her pavement trip.

During the hearings, covert video footage showing Mrs Fari moving freely was screened in the High Court. A hospital consultant also appeared in the witness box to confirm Mrs Fari’s deception.

Announcing his decision that Mrs Fari was in contempt of court because of her false claims, Mr Justice Spencer said last week that the surveillance film proved she was lying about her injuries.

”It’s impossible to reconcile the comparatively sprightly Mrs Fari with the badly crippled Mrs Fari,” the judge said. “She has throughout exaggerated to the medical witnesses her continuing level of disability arising from the accident.

Today’s conclusion to the case follows a prolonged legal battle which began when Mrs Fari, 59, tripped on a paving stone outside her home in Hornsey in May 2008.

Homes for Haringey initially admitted liability and offered to settle. But the council-run organisation changed its mind after Mrs Fari said she needed round-the-clock care.

She lodged a claim for more than £750,000 but it was struck out at Central London County Court last October after illiterate Mrs Fari was caught on camera moving around without help and carrying shopping bags uphill during a secret surveillance operation.

The case was referred to the High Court for abuse of process where today the former dinner lady, who suffers from arthritis due to a pre-existing injury, and her husband Piper were both found to be in contempt of court for exaggerating the injury and their resulting plight.

During the hearings, Mr Justice Spencer described Mrs Fari as “nobody’s fool”, adding: “Although she comes across superficially as a vulnerable and needy woman, I’m quite sure she’s a strong and domineering character.

“Although lacking in formal education and literacy skills, she’s nobody’s fool. I’m quite sure she’s capable of playing upon her educational and physical weaknesses when it suits her.”

The judge said that Mrs Fari had engaged in dishonest behaviour which interfered with the administration of justice by making false statements and representations to doctors verified in documents which she signed knowing the contents to be untrue.

These included claims she had to take taxis back from the shops, needed a crutch, was paying a relative for care and had been reduced to shuffling up and down stairs on her buttocks. She also told the High Court that her sex life had been damaged.

Today’s sentencing follows an earlier landmark Supreme Court ruling in another case, Summers v Fairclough Homes Ltd.

It gave the go-ahead for judges to throw out the legitimate part of a claim if it was “tainted by fraud and abuse of process”. The aim of the ruling was to deter litigants from making exaggerated claims and leaves them open to potential sanctions, including prison, if they do.