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Webb Resolutions v E.Surv + Blemain Finance v E.Surv

Expert valuation evidence, the “Margin of Non-Negligent Valuation”, and how to approach lenders’ contributory negligence

[2012] EWHC 3653 (TCC) 

[2012] EWHC 3654 (TCC) TEDR Volume: 17 Issue: 3

The Facts

Both cases also dealt with the proper approach to allegations that the lender had been contributory negligent.

Webb and Blemain were two separate claims brought by lenders. Both claims were against E.Surv. In both cases the lenders alleged that E.Surv’s surveyors had negligently over-valued the properties in question, with the result that the lenders had been persuaded to lend too much money.

In Webb, the court dealt with two valuations provided by E.Surv. Mr Ali purchased a 2-bedroom flat in a new development in Birmingham. E.Surv valued the property at £280,000 in November 2006. The true value was just £204,658, making the valuation negligent by 11.4%. Mr Bradley was seeking a remortgage. E.Surv valued Mr Bradley’s property at £295,000. The correct value at the time (July 2007) was £260,000, meaning the valuation was “out” by 13.5%.

In Blemain, in July 2007 E.Surv’s surveyor valued a 5-bedroom modern detached house located on a small private road in Putney Heath at £3.4 million. The borrowers obtained a second mortgage on the property from the claimant lender. Following repossession, Blemain as the second charge holder recovered nothing from the forced sale. In the claim against E.Surv the Court concluded that the proper valuation was £2.8 million, making the valuation negligent by a margin of 21%.

The Acceptable “Margin of Error” In Valuation

Coulson J accepted that valuations are not an exact science, and there was a permissible (ie non-negligent) margin of error within which a valuation may fall without it being negligent. He adopted the test set out in K/S Lincoln and Others v CB Richard Ellis Limited [2010] EWHC 1156 (TCC):  ..

For a standard residential property, the margin of error may be as low as +/- 5%. That reflected the significant number of comparable properties, which would provide an accurate gauge of the market value;  ..

For a “one-off” property, the margin of error will usually be +/- 10%, again reflecting the comparable sales information (or lack thereof);

If there are truly exceptional features to the property, the margin of error could be +/- 15%, or even more, depending on all the circumstances.

In the Blemain case, Coulson J held the appropriate margin of error for a non-negligent valuation was 10%, despite both experts agreeing in their evidence that the appropriate margin of error was 15%. Coulson J considered that whilst the property was “distinctive”, there were nevertheless a number of comparables available.

In Webb, the judge held the appropriate margin of error for both properties was 5%, mainly because there were a significant number of comparable properties, which permitted the market value to be gauged with a relatively high degree of accuracy.

Contributory Negligence  Contributory negligence and the associated level of reduction to any damages is a key feature in lender claims. In both Blemain and the case of the Ali loan in Webb, the Court held that there should be no reduction. However, the Court applied a reduction of 50% for the Bradley loan in Webb.

Although in Ali it was a high loan to value ratio (LTV of 85%), with a failure by the lenders to investigate the performance of other mortgages or verify income and defaults in Mr Ali’s current account, Mr Ali did not appear to be in any substantial financial difficulty at the time of the loan. Although Coulson J considered that lending to Mr Ali was a “recipe for disaster,” it concluded that the appropriate standard to apply was that of a reasonably competent centralised lender and practices common at the time should not be considered with hindsight. As the sub-prime self certified model was common between 2004-2007 (i.e. before the financial crash), the Court could not conclude that such lending was irrational or illogical. There was therefore no reduction for contributory negligence. The lender’s principal safeguard against loss was of course the fact that it only lent 85% of the valuation, and so given there should have been a 15% “cushion” to absorb any losses. It was of course that “cushion” that E. Surv’s negligent valuation had taken away.

The Court applied a 50% reduction in respect of the Bradley loan in the Webb case because of Mr Bradley’s financial position. Mr Bradley was clearly in financial difficulty prior to his application. He had £18,000 worth of defaults and £1,000 CCJ against him. The 50% contributory negligence was the result of the particular combination of factors. In particular, the remortgage was required to consolidate significant debts, and the very high LTV (95%) was considered beyond the acceptable exposure in the market at the time. Coulson J also concluded that the lender should never had advanced funds to Mr Bradley on a self-certified basis. Coulson J decided that a 50% reduction was appropriate.

Comment

These cases provide a good example of how the rules on the “margin of error” should be applied by valuation experts in practice. In essence, they make it clear that it all depends on the nature of the property. Coulson J also had no difficulty in substituting a lower margin of error despite the agreement of the experts that a 15% tolerance was appropriate. Both cases re-affirm that wherever possible, comparables should be used to achieve non-negligent valuations.

The ruling on contributory negligence is also interesting. Contributory negligence is of course a matter for the trial judge, being a matter of law. However, in many cases experts will still be able to give very useful evidence as to what is, and what is not good practice. It is significant to note that the judge did not feel it appropriate to reduce the damages in two of the three claims under consideration even though in at least one case the lending was relatively aggressive. In dismissing the allegations of contributory negligence in those instances, Coulson J took account of the then-prevalent practices in the marketplace. Those practices, and the general attitude in the market to risk, are things which often it will be very useful for experts to give evidence on.

Dar v Vonsak Gateway Insurance

Withdrawing admissions on the basis of late Expert evidence

[2012] EWHC 3632 (QB) TEDR Volume 17 Issue 3

The Facts

In August 2010 the claimant’s vehicle was alleged to have been involved in a collision at a roundabout. His vehicle was declared a total loss which led the appellant insurer to admit liability. The vehicle was then sold for scrap.

In May 2011 proceedings to recover damages for personal injury, together with hire charges and other heads of claim were issued. In its defence, the insurer raised, albeit faintly, concerns with the genuineness of the claim. However, in October 2011 the insurer obtained an engineer’s report whose conclusions were consistent with the claimant’s case.

In April 2012, the insurer obtained a further report which supported a case that the accident had not occurred as alleged by the claimant. It applied for permission to rely on it as expert evidence, withdraw its earlier admission, and to plead fraud. In response, the claimant obtained a report that supported his case that the accident was genuine.

The judge at first instance refused the insurer permission to withdraw the admission on the basis of the insurer’s April 2012 expert report. The Defendant insurer appealed to Eady J.

Eady J dismissed the appeal, holding that it was a matter of discretion for her to weigh the relevant factors, and that she had done so. CPR PD 14 para 7.2 required the judge to take into account prospects of success. She was entitled to take into account the first report obtained by the insurer, notwithstanding that neither party sought to rely on it. The relevant weight to be attached to various factors considered was a matter for the judge’s discretion. The graver the allegation against a litigant, the more important it became to ensure that a fair trial was possible. The judge had to take account the prejudice to the claimant in not being able to defend himself against an allegation of fraud. All of the experts agreed the best evidence was to be found on the vehicle itself, and it had been scrapped following the insurer’s admission of liability. The insurer’s second engineering report had been based on photographs and the conclusions were equivocal. In any event the application had been made too late.

Comment

At first blush this might look like a harsh outcome for the defendant insurers, but the case demonstrates the risks of making an early admission of liability, and the difficulty in withdrawing such an admission later even with the support of expert evidence. Indeed, it might be said here that the defendant insurer only had itself to blame. It had made an admission of liability pre-proceedings, with the result that the key piece of evidence – the car – was scrapped.

By the time a decision was made to withdraw the admission and plead fraud, the insurer’s expert was therefore operating under a significant handicap in reporting on the issues. Quite properly given his duty of independence under CPR 35, the insurer’s expert pointed out that it was hard to report to the court on the parties’ respective cases where all he had to work from was photographs. That limitation, and the fact that the insurer had obtained a previous report supporting the claimant’s case, appear to have been significant factors in the court refusing permission to withdraw the admission.

The expert’s approach was the right one. The case demonstrates the dangers of parties only taking a considered view on the facts late in the day, and then instructing an expert to “row them out” of the difficulties. The problem with such an approach is that the evidence the expert needs to do that is often then long gone – not just in road traffic cases, but also (for example) in building cases, where the defects can have been cured or covered up long before the expert comes to site.

Cecil Guntrip v Cheney Coaches Ltd

Another Expert changes his mind – The effect on the party

[2012] EWCA Civ 392 TEDR Volume 17 Issue 2

The Facts & Issues

The appellant appealed to the Court of Appeal from the decision of a Circuit Judge which upheld an appeal from the decision of the District Judge to refuse to permit the Respondent to rely on a supplementary expert report.

While the Applicant coach driver was employed by the Respondent coach company he underwent a left knee replacement procedure and had six months away absence from work to recuperate.

When he returned to work he was given a manual coach to drive, which meant that he had to operate the clutch with his left foot. That caused him pain and he gave up work.

Very shortly before the expiry of the limitation period he issued a claim against C in negligence and/or breach of duty alleging that C should not have required him to drive a manual coach and/or should have undertaken a risk assessment.

He obtained the opinion of a medical expert and the Respondent also instructed an expert.

The initial somewhat tentative opinion of the Applicant’s expert was that the knee problems could have been caused by his return to work in the circumstances outlined above – however, the Joint Statement prepared by him and the Respondent’s expert witness concluded that the Applicant’s work did not cause his knee symptoms and stated that his work was of a type that somebody could routinely expect to go back to following the type of knee replacement he had undergone.

Tight up against the trial date, the Applicant applied to rely on the report of a different expert, given that his original expert’s current views did not support his case.

The District Judge refused his application to rely on fresh expert evidence and took into consideration:

i) the age of the case

ii) late issue of the application to rely on replacement expert evidence

iii) the additional delay

iv) the additional costs and

v) risk of unfairness resulting from permitting the application, and

vi) the fact that his original expert’s opinion had been only tentative in nature ahead of the joint statement of experts being made.

The Applicant then appealed to the Circuit Judge and was successful but the Respondent appealed to the Court of Appeal against the Circuit Judge’s decision.

The Decision

i) The Overriding Duty of an expert witness was to the Court.

ii) In the context of case management it was appropriate for an expert to modify his opinion if he had changed his view as that would save time and costs.

iii) If an expert witness considered that he could not support his client’s case he should say so sooner rather than later.

iv) The court was against “expert shopping”, especially as in this case where the Applicant had had a free choice of expert at the outset.

v) The District Judge, when he refused the application, had considered both parties interests properly. He took into account the delays that had already happened, and the significant further expense of producing further replacement expert evidence. The Circuit Judge had overruled the District Judge’s decision on the ground that the Applicant’s case would otherwise fail and took the view that the District Judge had gone beyond his discretion in refusing the application. However the Court of Appeal disagreed and in allowing the appeal it overturned the Circuit Judge’s decision and reinstated the original decision of the District Judge.

Comment

A hard case for the Applicant and it has to be said the key view contained in the Joint Statement of the experts might seem somewhat surprising on the basic facts outlined. However, it shows that the resources of the Court need to be guarded with care and “expert shopping” particularly when done well into proceedings will generally not be permitted unless there are compelling reasons to do so. It also shows the gravity of a change of view of a party appointed expert at the meeting of experts stage.

It is a case which gives added weight to the right of an expert to change his view and also the danger for a litigant relying too heavily on a tentative view of an expert when that expert then goes into a meeting with the other side’s expert who presumably may hold views that are by no means tentative.

Smales v Lea and Others

Experts fees – Statute Barred

[2011] EWCA Civ 1325 TEDR Volume 16 Issue 3

The Facts

The Claimant was a Chartered Surveyor of many years experience. He had been engaged by the occupants of a first floor flat to report into defects with the property in which they lived. They owned the freehold to the whole property and another two people lived in the ground floor flat. The surveyor noted damage and his services were engaged by the occupants of the first floor flat to commission repairs and to liaise with their insurance company to get those repairs funded. The occupants downstairs thought that that was a sensible suggestion and thus engaged the Claimant on a similar basis.

On the insurance front, the Claimant had to deal with the claims under two separate policies.

The insurers of the downstairs flat were CIS who instructed Ellis and Buckle to act as their loss adjusters.

In relation to the Claimant’s own fees, agreement in principle was reached with Ellis and Buckle on the 12th October 1999 as follows:-

“Insurers have confirmed that they have no objection to you continuing your involvement and they have accepted that an agreed proportion of the final rendered fee should fall to the CIS for financing”.

One of the ground floor occupants died in 1996 and thereafter the other occupant became the sole client. The Claimant was still acting in the expectation that the CIS would meet his fees in due course.

Shortly after the works were finished the Claimant himself suffered ill health. That said during 1999 he managed to sort out final accounts but they did not get delivered to either the resident; to Ellis and Buckle; or to the CIS. During 1999 and 2000 Ellis and Buckle are said to have chased the Claimant on many occasions for his bill.

Eventually the bill was sent in about June 2001 to Ellis and Buckle.

A dispute arose as to whether the bill should be served on the occupant himself.

The Claimant attempted service upon him but discovered that he had moved away without leaving a forwarding address. In the meantime, negotiations continued with Ellis and Buckle and by the 21st October 2006 the occupant died. Shortly afterwards the Claimant discovered, through his researches, the address to which he had moved.

The Claimant continued to correspond with his executors requesting that they should pay the full invoice.

Meanwhile, Ellis and Buckle offered to pay what must have amounted to about one third of the bill saying that the rest was grossly excessive. The proceedings were issued on the 24th November 2008. The matter was deemed to be time barred by the Judge at first instance and therefore the matter was appealed to the Court of Appeal.

The Issues

The issue was whether the matter was statute barred or not.

The Decision

It had been argued that the contract between the Claimant and the resident of the flat was an entire contract such that one party must perform all of his obligations before the other party comes under an obligation to make payment.

There is, of course, very good authority to the fact that this can be the situation. In the instant contract, there were a number of obligations on the Claimant. He had got to get remedial work done and paid for. He was then required to negotiate with insurers about his own fees. However, that was not the same as saying the contract was an entire contract whereby the Surveyor had no entitlement to any remuneration until each one of the obligations set out had been performed.

The Judge commented that it was relatively unusual for a client to have no obligation to pay unless and until the professional firm had performed every single obligation and whilst it could happen, it was not the situation in this case. Therefore, the Claimant had become entitled to his fees long before negotiations as to the size of his fee had broken down. Accordingly, the Court considered when the Claimant had become entitled to recover his fees. It was held that, at the latest, the Claimant was so entitled during 1999 once the remedial works had been finished. The contractors had been duly paid; their accounts had been agreed; and the respective insurance companies had remitted the sums which were due for the construction works. At this point the Court said that the Claimant had carried out the principal part of his obligations and therefore he was entitled to be paid for what he had done. Accordingly, the Claimant’s claim for unpaid fees was statute barred.

Comment

Expert witnesses should bear in mind that cases can go on for some considerable time.

It is worth the date for payment being spelt out in the letter of instruction, even if it is only by reference to the litigation coming to a conclusion or some other description of when the expert is entitled to be paid.

The limitation period to sue on that contract is six years from that date.

Medimmune limited v (1) Novartis Pharmaceuticals UK Ltd And (2) the Medical Research Council

The drafting of Experts’ reports

[2011] EWHC 1669 (pat) TEDR Volume 16 Issue 2

The Facts

This case concerned an action by the Claimant against the First Defendant for an alleged infringement of a patent. Technical expert evidence was thus required.

The Issues

The Court discussed and gave guidance upon the instruction of expert witnesses, particularly in complex cases such as patent cases.

The Guidance given

Mr. Justice Arnold commenced by setting out the salient sections of CPR Part 35 and the Practice Directions. These included.

Experts – overriding duty to the Court

35.3

(1) It is a duty of experts to help the Court on matters within their expertise.

(2) This duty overrides any obligation to the person from whom experts have received instructions or by whom they get paid.

Contents of the report

35.10(1) An expert’s report must comply with the requirement set out in Practice Direction 35.

(3) The expert’s report must state the substance for all material instructions, whether written or oral, on the basis of which the report was written.

Practice Direction 35 – Experts and Assessors:

2.1 Expert evidence should be the independent product of the expert uninfluenced by the pressures of litigation.

2.3 Experts should consider all material facts, including those which might detract from their opinions. The Practice Direction also sets out the following requirement for the form and content of the expert’s report:

3.1 An expert’s report should be addressed to the Court and not the party from whom the expert has received instructions.

3.2 An expert’s report must:

(3) Contain a statement setting out the substance of the facts and instructions which are material to the opinions expressed in the report or upon which those opinions are based;

(4) Make clear which of the facts stated in the report are within the expert’s own knowledge;

(5) Say who carried out any examination, measurement, test or experiment which the expert has used for the report, give the qualifications of that person, and say whether or not the test or experiment has been carried out under the expert’s supervision;

(6) Where there is a range of opinion when the matter is dealt with in the report –

a) Summarise the range of opinions;

b) Give reasons for the expert’s own opinion;

(7) Contain summary of the conclusions reached; The protocol for the instruction of experts to give evidence in civil claims (emphasis added):

2. Aims of Protocol

2.1 This protocol offers guidance to experts and those instructing them in the interpretation of and compliance with Part 35 of the Civil Procedure Rules (CPR 35) and its associated Practice Direction (PD) 35 and to further the objective of the Civil Procedure Rules in general. It is intended to assist in the interpretation of those provisions in the interests of good practice but it does not replace them. It sets out standards for the use of experts and the conduct of experts and those who instruct them. The existence of this protocol does not remove the need for experts and those who instruct them to be familiar with CPR 35 and Practice Direction 35.

3. Application

3.3 Experts, and those instructing them should be aware that some cases may be “specialist proceedings” (CPR 49) where there are modifications to the civil procedure rules. Proceedings may also be governed by other protocols. Further, some Courts have published their own guides which supplement the civil procedure rules and proceedings in those Courts. They contain provisions affecting expert evidence. The expert witnesses and those instructing them should be familiar with them when they are relevant.

4. Duties of experts

4.1 Experts always owe a duty to exercise reasonable skill and care to those instructing them, and to comply with any relevant professional code of ethics. However when they are instructed to give or prepare evidence for the purpose of civil proceedings in England and Wales they have an overriding duty to help the Court on matters within their expertise (CPR 35.3). This duty overrides any obligation to the person instructing or paying them. The experts must not serve the exclusive interest of those who retain them.

4.3 Experts should provide opinions which are independent, regardless of the pressures of litigation. In this context, a useful test of “independence” is that the expert would express the same opinion if given the same instructions by the opposing party. Experts should not take it upon themselves to promote the point of view of the party instructing them or engage the role of advocates.

8. Instructions

8.1 Those instructing experts should ensure that they give clear instructions, including the following:-

(c) The purpose of requesting the advice or report, a description of the matter(s) to be investigated, the principle known and the identity of the parties.

In the light of the rules, the Learned Judge went on to consider the role of an expert witness particularly in patent litigation. He observed that in this particular field the experts would normally be scientists or engineers, who were frequently academics not experienced in giving expert evidence or in the patent system. For those reasons expert witnesses would require a very high level of instruction from the lawyers. Furthermore whilst experienced authors, they would frequently require considerable help from lawyers in drafting their report. Sometimes, lawyers would draft the reports and the draft would be duly amended by the expert. In terms of the lawyer’s role, they are required to understand what the expert says but in addition both parties need to frequently discuss the issues to allow the report to be prepared.

The Learned Judge continued that it had to be recognised that there is a risk of a loss of objectivity on the part of the expert, even though they were remaining independent and impartial. Lawyers needed to keep the requirement for the expert to remain objective at the forefront of their mind. If they did not they would be doing both the expert and their client a disservice because the expert could be subject to criticism during cross examination and in the Court’s judgement. A partisan expert would frequently be exposed in cross examination which could therefore reduce, if not eliminate, the value of the evidence to the client’s case.

Ultimately, the drafting of the report should not major upon the strong points of the case. It is still necessary for it to be a balanced account within the document upon which the witness will be cross examined. There should also be an awareness that the lawyers for the opposing party are likely to comb through the expert’s published papers and any other publicly accessible records in an attempt to find something of relevance to the issues that have not been disclosed by the expert in the report. The expert stands to be accused in cross examination of failing in his duty to the Court if it appears to favour the opposing party and it has not been made clear within the report itself.

There are very many cases in which judges have criticised expert witnesses for failing to be objective or in other ways. From time to time experts do succumb to giving partisan evidence which the judge observed was clearly unacceptable. However, the judge wished to re-emphasise that the lawyers who instruct expert witnesses bear a heavy responsibility for ensuring that an expert witness is not put in a position where he can be made to have failed in his duty to the Court even though he conscientiously believes that he has complied with that duty. The Courts should also be cautious about criticising an expert witness purely on the basis of omissions from his report unless it is clear the fault does lie with the expert rather than those instructing him.

The Conclusion

This case really reiterates the guidance that is given in the CPR to experts. There is nothing intrinsically wrong with a lawyer assisting an expert to draft the report upon the basis of the expert’s own evidence. However, both parties bear a very high duty to ensure that the report that is finally disclosed gives a fair and balanced account of what the expert actually means lest any omissions are exposed in cross examination to the detriment both of the expert and the lay client.

Zeid And Others v Credit Suisse

The experience of an Expert

[2011] EWHC 2422 (Comm), [2011] 2 CLC 523 TEDR Volume: 16 Issue: 1

The Facts

This was an application to determine whether expert evidence might or might not be of assistance in a complex financial case where Credit Suisse had advised the Claimants to invest in some Structured Notes.

The first attack that was made was upon the expertise of the expert himself. He was a man with some 15 years experience in dealing with structured products and had academic and professional qualifications relating to securities dealing. He had worked in the industry with direct client contact and, thereafter, he had worked as a consultant to the industry.

Overall, when looking at the CV of the proposed expert, Mr. Justice Hamblen considered that the expert was generally qualified to give evidence on the topics which he was going to be required to talk about. It was accepted that expertise can be based on both experience and study, both of which the expert in this particular case appeared to have. This particular field of expertise had no professional body and the Defendant tried to make mileage out of this fact. However, the judge felt that given there was a structure to investment advice within the country with various FSA rules governing it, he considered that the Court was likely to derive some help from a person with a real understanding of such products. The Court went on to say that of course the weight that the evidence would be given in the end of the day would be a matter for the trial judge. The Defendants would of course be free to make whatever point they wished to make about the level of expertise at trial. However, that was not a reason for excluding the evidence in the first place given that it was only admissibility that the Court was considered with at the permission stage.

Issues

Was expert evidence necessary?

Comment

Overall, it is not necessarily the case that experts have to have professional qualifications or be members of professional bodies to allow them to give expert evidence upon an issue. Clearly, people can gain expertise in particular fields over the years by pursuing their interests or profession and will be well able to talk about that with expertise before a tribunal. Whilst of course lack of expertise can lead to cross examination in the witness box, a lack of expertise can lead to cross examination in the witness box, a lack of paper qualifications should not be of too much concern.

Meat Corporation Of Namibia Limited v Dawn Meats (UK) Limited

The independence of an Expert

[2011] EWHC 474 (Ch) TEDR Volume: 16 Issue: 1

The Facts

This involved an application by the Claimant, Meat Co against the Defendant, Dawn, to oppose an application by the Defendant to call a new expert witness. They wished permission to be refused on the basis that proposed expert was in possession of confidential and privileged information concerning the Claimant which they said prevented her from acting or continuing to act for the Defendant and because they said she lacked the necessary independence of an expert. It was agreed that the expert was a retired meat trader and had the appropriate qualifications to be a suitable expert in the case. That was doubly so given that both sides had tried to instruct her in the matter. The Claimant tried first followed by the Defendant. The Claimant’s managing director (who used to work for the Defendant) had contacted the expert in May 2010. A conversation took place between the pair and, at the time, she said she was expecting to hear from the Defendant with a view to engagement as a consultant. There were also several e-mails between the pair. Full details of the information shared between them were not made available within the Judgement but made available to the Judge to assist him in making his decision.

 Issues

1. Did the fact the proposed expert possessed privileged and confidential information about the other party disqualify her from acting as an expert?

2. Did the proposed Expert lack independence?

The Decision

Privilege and confidentiality

It was not contested that the expert had been given some privileged and confidential information. However, His Lordship did not agree with the Claimant that the expert ought to be treated in the same way as perhaps a solicitor and client would be treated if there had been a previous engagement that had Lordship’s conclusion was that the expert had only received the information in the course of enquiries as to whether she would “that does not rob it of its confidential quality, but it does mean that the relationship between her and Meat Co is very different from that of an engaged solicitor and his client”. He observed that to some extent the information had been forced upon her and whilst she could have refused to receive the information it was not appropriate to equate her with the sort of relationship of a solicitor and client. Overall His Lordship considered that, whilst confidentiality and privilege must be maintained, an undertaking by the expert she would maintain privilege and confidentiality would be sufficient. Overall His Lordship did not think that her deciding to act for the Defendant meant that she would betray confidences she had received and that it was a matter for her to decide what to do.

Further, having reviewed the e-mails and privileged information he considered that much of it would be uninteresting to the Defendant in any event and, as observed above, the undertaking would prevent her disclosing it.

Overall whilst previous cases have suggested that the practical approach was for the expert to refuse to act for both sides thus leaving the solicitors with the sensible course of action of seeking alternative experts, that did not automatically follow and the expert was not automatically disqualified. Overall therefore Mr Justice Mann considered that the expert was not disqualified from acting as an expert by virtue of her receipt of privileged and confidential information in this particular case.

Lack of independence

The second limb of objection was that the expert lacked the necessary independence. The Court set out the principles which were conveniently set out by Mr. Justice Nelson in Armchair Passenger Transport Limited v Helical Bar PLC [2003] EWHC 367 as follows:

i) It is always desirable that experts should have no actual or apparent interest in the outcome of proceedings.

ii) The existence of such an interest, whether as an employee of the parties or otherwise, does not automatically render the evidence of that proposed expert inadmissible. It is the nature and extent of the interest or connection that matters, not the mere fact of the interest or connection.

iii) Where the expert has an interest of one kind or another in the outcome of the case, the question of whether he should be permitted to give evidence should be determined as soon as possible in the course of case management.

iv) The decision as to whether an expert should be permitted to give evidence in such circumstances is a matter of fact and degree. The test of apparent bias is not relevant to the question of whether or not an expert should be permitted to give evidence.

v) The questions which have to be determined [are] whether (i) that the person has expertise; and (ii) he or she is aware of their primary duty to the Court if they give expert evidence and willing and able despite the interest or connection with the litigation or party thereto, to carry out that duty.

vi) The judge will have to weigh the alternative choices openly if the expert’s evidence is excluded, having regard to the overriding objective of the CPR.

vii) If the expert has an interest which is not sufficient to preclude him from giving evidence the interest may nevertheless affect the weight of his evidence.

His Lordship also applied one qualification of his own in that he was of the view that sometimes it would not be possible to determine with any clarity whether there was any disqualifying connection between the expert and the party at an interlocutory stage. Whilst of course it is desirable to do so, he would not rule out the prospect of having to decide the point at trial if necessary. Overall, the conclusion is that whether or not an expert is disqualified by reason of a connection with a party will depend upon the facts of the case and not on a single issue such as whether there is some contractual relationship between the two. The status of being an employee does not automatically disqualify a person acting as an expert and therefore it is difficult to see why the status of a consultant with limited functions would either.

Comment

Clearly, issues such as the above can be raised by the legal representatives at the interlocutory stage in the case. However, they are also issues that can be raised in cross examination during the trial for determination then. It may therefore be thought by experts that, professionally, they wish to decline instructions on the basis that there may be a conflict of interest or that it may result in difficult cross examination at trial even if ultimately there is no such conflict.

Warner (a protected party) v Penningtons & Others

Scope of an Expert’s duty

119 BMLR 126, (2011) 119 BMLR 126, [2011] EWCA Civ 337 TEDR Volume 15 Issue 3

The Facts

The main action involved a claim for alleged professional negligence on the part of solicitors and/or counsel in undersettling  a personal injury action brought by the Claimant arising out of a serious brain injury sustained by him in 1993.

During the course of that action, the Claimant’s solicitor (“Penningtons”) commissioned a report from Gwen Watkins of Jacqueline Webb and Co. to provide an assessment of case management needs and past and future care requirements.

Gwen Watkins provided a report stating, amongst other things, “Mr Warner’s quality of life will have reduced without regular support and funds should be made available as a matter of priority to ensure that a new care regime can be established”.

Gwen Watkins had, in fact, also highlighted the importance of lay witness evidence and of obtaining various medical report and evidence.

Proceedings were issued by Mr Warner against Penningtons who then sought to join Counsel and Jacqueline Webb to the proceedings.

As against Jacqueline Webb, Penningtons alleged that Gwen Watkins:

Failed to advise that a support worker and/or case manager should be employed prior to trial or settlement of the action;

Having met with the Claimant and having considered the medical reports, failed to advise the Defendants to obtain further lay witness statements

Failed to have proper regard to the level of care needed by the Claimant in the future

Failed to take sufficient care in the preparation and provision of her advice

The instant matter and judgment relates solely t o t h e proceeding s between Penningtons and Jacqueline Webb. Jacqueline Webb were seeking summary judgment against Penningtons on the grounds that there was no real prospect of the case against them succeeding and an order striking the claim out on the basis of expert witness immunity. The latter point was stayed pending consideration of the immunity of Expert witnesses by the Supreme Court during 2011.

The Issues

Did Pennington’s have real prospects of succeeding against Jacqueline Webb?

The Decision

Overall, the learned Judge said, “no”, there were no real prospects of success. Whilst making it clear that the Expert was required to exercise all proper skill, care, diligence and competence in identifying the Claimant’s needs, in so doing, the Expert is dependent in part on the information provided by her instructing solicitors and in part upon her own observations. It was, apparently, conceded that there was no basis for questioning the assessment made and thus, it seemed to the Judge that Gwen Watkins had therefore made reasonable decisions on the basis of the information. The complaint, effectively, came down to whether she ought to have advised Penningtons that a Case Manager should have been put in place prior to the trial. Overall, the Judge felt is was “unarguable” that Gwen Watkins was not entitled to assume that the Solicitors would take the appropriate steps to appoint a case manager and to expect that to be done prior to the trial. Accordingly, summary judgment was granted.

Comment

Clearly, the Expert must use reasonable skill and care in forming their views and even in identifying areas where further evidence should be obtained. However, they are entitled to assume their recommendations will be taken on board and, if necessary, actioned by their instructing solicitors who are tasked with progressing the litigation.

England v Foster Wheeler Limited & Others

Expert criticised for changing opinion without justification

14th August 2009 (Sheffield County Court) TEDR Volume 15 Issue 2

The Facts

This case involved a claim by the Claimant against five potential Defendants, all of whom employed him at some period or periods of his working life. His claim was for pleural thickening with restriction and respiratory disability. It was said that this was caused due to exposure to asbestos whilst at work.

The learned Judge heard from the Claimant and his wife together with three Consultants with expertise in the field of diseases of the chest. There was an expert witness called on behalf of the Claimant and one on behalf of each of the Fourth and Fifth Defendants. Those witnesses had met and discussed the issues. They had prepared a joint report. It was clear that whilst there was some areas of agreement there were also areas of disagreement. The Claimant’s witness had been caused to change his opinion somewhat in cross-examination from that set out in the joint report.

The Issues

What factors did the Judge consider relevant in deciding weighing up the expert evidence?

The Decision

Overall, the learned Judge observed that the expert plainly owed a duty to the Court to give his present opinions and not simply to repeat his older views if he no longer held them. However, the learned Judge referred to the fact that the Claimant’s expert seemed to express no new factor in the witness box in moderating his view and it was simply a reevaluation  of the evidence. He did not consider that the expert had given a real explanation for resiling from his view set out in the joint statement save that he could not recall the discussions leading up to part of his view. On the other hand the learned Judge did not detect any change of view of either of the Defendants’ experts that were called.

Overall, the learned Judge therefore found that the evidence of the Defendants’ experts was to be preferred.

Further, the Claimant had sought to rely upon the medical records of the Claimant and in particular a record that disclosed a treating Consultant (a Cardiologist and therefore not necessarily within the same field of expertise) had considered the Claimant to have a significant restrictive lung disease. It was said that this supported his case. Overall, the learned Judge considered that his main task was to evaluate the evidence of the medico-legal experts rather than to evaluate the very briefly expressed views of a Consultant.

Comment

Whilst it is of course important that an expert gives his or her considered and current view to the Court, whether at the time of writing the report or indeed in the witness box, it is equally important to lend credibility to such a change or shift in view that the expert fully explains why he or she has changed their view. After all, the expert who is forced to change a view because they reconsider some new evidence or can explain the reason for the change, is actually more likely rather than less likely to be accepted at the end of the day. However, an expert that simply changes his or her mind because they have re-evaluated the evidence or perhaps moderated their view for no other reason than they did not think of it early enough is vulnerable to attack on the above grounds.

Tufano v Vincenti

Immunity from Suit applicable to Experts – Libel Proceedings

[2006] EWHC 1496 (QB) TEDR Volume 11 Issue 2

The Facts

The applicant (V) had been instructed as an expert psychiatrist to prepare a report on T’s psychiatric condition and on any other matters within his expertise. T had agreed to the preparation of the report but complained that it was defamatory.

The Issues

Was there immunity from suit for the expert witness?

The Decision

As a witness V was protected by immunity from suit. This applied to him as an expert witness and applied to libel proceedings.

Comment

This decision relied on the High Court decision of Collins J in Meadow v GMC [2006] EWHC 146 (Admin). Notably, that case and its specific decision on immunity from disciplinary/regulatory proceedings has recently been overturned on appeal by the Court of Appeal (see the article in this edition of the Expert and Dispute Resolver which reviews the Court of Appeal decision). Nevertheless, it appears probable that this High Court decision remains a correct one as a matter of law on the footing that libel proceedings are properly viewed as being a “suit” – albeit that the normal sort of proceedings would generally be founded on allegations of professional negligence.

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