Expert evidence: is it needed, when will the court allow it and the importance of staying engaged throughout the proceedings



Welcome to our latest review of expert evidence decisions with a UK construction flavour.

The overriding objective of the Civil Procedure Rules (CPR) is to ensure the court deals with cases justly and at proportionate cost. In relation to expert evidence, the CPR now offer a range of options to ensure that expert evidence, if needed, is dealt with efficiently, in a manner appropriate to the case and at minimum cost. Recent decisions indicate that the courts are paying particular attention to whether expert evidence is necessary and, in a number of examples, judges have shown themselves to be quite prepared to refuse the admission of expert evidence where appropriate. (See the first and second items below.)

Construction disputes often involve highly technical issues and can succeed or fail on the weight given to their expert evidence by the Court or Tribunal. The key to effectively managing expert evidence is to ascertain early on in the dispute what evidence is needed on each issue, if any. Parties to proceedings in the Technology and Construction Court are not compelled to engage experts from the outset. The Construction Pre-Action Protocol stipulates only that the parties should discuss the need for expert evidence at the Pre-Action meeting. The Protocol does not expect or require the parties to provide expert reports before they start proceedings but does note that expert reports can, in cases where they are succinct and central to the claim, form a helpful way of explaining the claimant’s position. Given the experiences of those involved in the Arroyo case referred to below, parties in complex disputes with significant technical issues are likely to consider the cost of obtaining early expert advice to be money well spent in hindsight.

As well as early research and preparation into expert evidence, it is equally crucial to obtain an appropriate order at the case management conference(s), for the parties to engage fully with each other during the proceedings, to monitor the need for expert evidence throughout and if that needs changes, to obtain an amended order as soon as possible. The costs consequences of not taking this approach can be seen in the UPL case below.

Expert evidence is not always needed – in some cases the judge can assess the technical evidence

Parties should not assume automatically that technical cases require expert evidence.

Civil Procedure Rule (CPR) 35, which sets out the rules on expert evidence, provides that disputing parties can only rely on expert evidence with the court's permission and where such evidence is reasonably required to resolve the proceedings. In some cases, the judge is perfectly able to measure the evidence and form a view without the need for expert assistance. That said, there is sometimes a fine line between issues that require expert evidence and those that do not – as demonstrated by the decision in Vilca and 21 others v. Xstrata Ltd and another [2016] EWHC 2757 (QB).

In Vilca, the defendants were part of a mining operation and had adopted the "Voluntary Principles on Security and Human Rights" (VPs), a United Nations backed set of principles "designed to guide companies in maintaining the safety and security of their operations within an operating framework that encourages respect for human rights".

The claimants were protesters involved in demonstrations at the mine and made various allegations relating to breaches of their human rights and the actions of the defendants' security policing. The claimants applied for permission to rely upon the evidence of an expert witness to help the court determine the purpose and effect of the operational guidance set out in the VPs.

The defendants objected and relied on the judgment in Barings Plc v. Coopers & Lybrand [2001] PNLR 22. While acknowledging that the expert was no doubt distinguished in his field, the defendants argued that his evidence did not come within the definition of expert evidence. In this case, in relation to the particular issues in dispute, there was no recognised expertise governed by recognised standards and rules of conduct capable of influencing the court's decision. The VPs were, by the claimants' own admission, aspirational guidance rather than industry standards.

Agreeing with the defendant, the judge held that there was no "objectively ascertainable standard or consensus against which to judge the defendants' behaviour". The VPs were clearly articulated and unambiguous and the trial judge could and should therefore measure whether the defendants had complied – or not – with the VPs without the need for expert assistance.

Key points

  • In all cases, check that expert evidence is necessary. A court is unlikely to permit expert evidence where there is "no objectively ascertainable standard or consensus against which to judge the defendants' behaviour".
  • The principle of open communication with the other party is again relevant here: the necessity for expert evidence should be discussed and where possible agreed before the case management conference.

Another example of the court refusing leave for expert opinion evidence (but can the expert give evidence of fact anyway?)

Darby Properties Ltd v. Lloyds Bank Plc [2016] EWHC 2494 (Ch) is another example of the court excluding expert evidence on the basis that it was not necessary. It did, however, conclude that CPR 35 does not cover evidence of fact which seemed to leave the path open for the claimant's expert to give evidence of fact.

In Darby, the claimant alleged the defendant was in breach of contract and negligent in respect of advice given relating to certain interest rate derivative products. The key issues in dispute related to whether the products recommended by the defendants were suitable for the claimants and whether the information provided was adequate.

In finding that expert evidence was not needed on these issues, Master Matthews set out some commonly accepted principles about the admissibility of evidence which are listed below.

Key principles the court considers when deciding whether to admit expert evidence

  • Part 35 of the Civil Procedure Rules (CPR 35) governs expert evidence. Under CPR 35.1, "expert evidence shall be restricted to that which is reasonably required to resolve the proceedings."
  • Expert evidence is admissible under Section 3 of the Civil Evidence Act 1972 (CEA) in any case where the court accepts that … [1] there exists a recognised expertise governed by recognised standards and rules of conduct [2] capable of influencing the court's decision on any of the issues which it has to decide and [3] the witness to be called satisfies the court that he has a sufficient familiarity with and knowledge of the expertise in question to render his opinion potentially of value in resolving any of those issues. (Barings Plc v. Coopers & Lybrand [2001] PNLR 22, [45])
  • If there is no recognised body of expertise governed by recognised standards and rules of conduct relevant to the issue on which the court must decide, the court should not admit evidence which is the subjective opinion of the intended witness rather than the evidence of any body of expertise.
  • The general rule is that evidence of fact is admissible if relevant, but evidence of opinion, even if relevant, is not admissible unless it falls within certain exceptions; the main exception is that evidence of expert opinion is admissible if relevant.
  • When considering the relevance and admissibility of expert opinion, the party wanting to adduce the evidence must work through a three-stage test: (1) is the expert evidence reasonably necessary to resolve the issue? If not, (2) would the evidence assist the court? (3) Is the evidence (considered on an issue by issue basis) reasonably required to resolve the proceedings? (British Airways Plc v. Spencer [2015] EWHC 2477 (Ch))
  • An expert is not to find facts but to express an expert opinion on the basis of assumed facts. (JP Morgan v. Springwell [2007] 1 All ER (Comm) 549 [2006] EWHC 2755 (Comm) [21])
  • An expert's expression of opinion of what he/she would have done in the hypothetical situation is not admissible. (Midland Bank Trust Company Ltd. v. Hetts Stubbs & Kemp [1979] 1 Ch 384, 402)
  • The opinions of skilled witnesses, those with relevant experience or a course of study under their belt, are admissible if relevant as governed by CPR 35. Their evidence is only admissible if it is reasonably required to resolve the proceedings. (Barings v. Coopers & Lybrand)

The Master underlined the court's and the parties' duties in relation to expert evidence by quoting the words of Aiken J in JP Morgan v. Springwell [2007] 1 All ER (Comm) 549 [2006] EWHC 2755 (Comm) which are relevant to large commercial disputes such as those found in construction claims:

"It is the duty of parties, particularly those involved in large scale commercial litigation, to ensure that they adhere to both the letter and spirit of [CPR 35.1]. And it is the duty of the court, even if only for its own protection, to reject firmly all expert evidence that is not reasonably required to resolve the proceedings."

A practical warning – experts must stick to the relevant issues

Master Matthews highlighted from the case of JP Morgan a useful warning to parties involved in large disputes with many documents and large sums of money involved. In short, they should avoid "the natural tendency" to employ experts to assist in digesting this material, thinking it will help the judge with areas of fact that appear to be outside the "normal" experience of a Commercial Court judge. This can submerge the judge in long, complicated expert reports that stray far outside the relevant issues. Preparing such expert reports is expensive, time-consuming and may ultimately be counter-productive. "That is precisely why [CPR 35.1] exists."

Can experts give evidence of fact without court permission?

Of additional note in Darby was the Master's conclusion that nothing in CPR 35 restricts the giving of factual evidence, whether given by an expert or not. Neither CPR 35 nor the CEA define "expert evidence" and the Master considered a distinction "that seems to exist in Scots law" between (i) factual evidence given by an expert which does not require any kind of decision on admissibility (assuming it is relevant) and (ii) factual evidence given by an expert which draws on the expertise of the witness, for example in relation to knowledge and training, such as the engineer dealing with the workings of a machine, which does require a decision on admissibility. To further explain this distinction, the judge gave this example between:

"evidence being given by an expert witness of a purely factual matter which was something, let us say, observed or experienced directly by the witness, such as the slope of the pavement on which the pursuer was walking when she fell; and, on the other hand, factual evidence being based on knowledge and experience of a subject matter or drawing on the work of others such as the findings of published research or pooled knowledge".

The judge found that this distinction in factual evidence does not exist in English law and seemed to suggest that the claimant's evidence, being factual, could be given by an expert without the need to obtain court permission. However, he did not, on the facts, seek to draw a line between what was factual evidence and could be given by the expert without permission – and what was "expert evidence" needing permission.

In practice, few litigators would put forward an expert to give any evidence of fact in the context of their expertise, without first seeking the court's permission.

Parties must co-operate and engage with each other on expert evidence

In UPL Europe Ltd and another v. Agchemaccess Chemicals Ltd and others [2016] EWHC 2889 (Ch), the lack of engagement on expert evidence by two of the defendants resulted in a costs penalty.

The parties were in dispute over the defendants' trade in plant protection products. A technical issue arose as to the chemical composition of the products and, at a costs and case management hearing, the court gave an order for expert evidence after carefully considering its scope.

Some months into the proceedings, the Claimants' solicitors wrote to the first and third defendants' (the Defendants) solicitors to say they no longer thought expert evidence was needed. They asked for the Defendants' proposals as to what they intended to test, how and what for. When this letter and other attempts to elicit a response – including a threat to seek a court order – were unsuccessful, the Claimant's solicitors applied to the court for an order that the Defendants should be barred from relying on expert evidence. The Defendants' solicitors then confirmed that they were well advanced in preparing expert evidence and intended to meet the deadline for exchange of the experts' reports. They would not, however, engage in discussions about the methodology for producing the report.

The court hearing proceeded but the Claimants did not pursue their application for an order for the Defendants to be barred from relying on expert evidence. Instead the hearing was usefully utilised to review the expert evidence.

Not surprisingly, there followed an argument about who was to bear the costs of that hearing. The Claimants argued that their application was necessary and they had been successful. The Defendants argued that the Claimants had not obtained the relief they sought, had taken an unduly aggressive stance and the hearing had effectively been conducted as a case management hearing.

The court agreed, largely speaking, with the Claimants and, in awarding them 85 per cent of their costs, rejected the Defendants' arguments. The 15 per cent markdown was the court's acknowledgement that the Claimants had not in the end pursued their application.

It is worth noting that the Court considered the Defendants' characterisation of the Claimants' approach as "unduly aggressive" bore no relation to reality. The Claimants' letters had been measured and sensible. The Defendants' lack of engagement and the Defendants' apparent last minute attempt to "wrong-foot" the Claimants by producing expert evidence without considering or discussing its scope and the methodology for its production meant the Claimants had no choice but to bring the issues to court for determination.

Key points

  • The parties must communicate with each other about the expert evidence.
  • The facts of the case will dictate whether the lawyers or the experts conduct the necessary discussions.
  • Failure to engage – and a failure to ensure communications themselves are clear – could lead to costs sanctions. (It is never a good idea to mislead the other party/ies.)
  • In almost every case in which expert evidence is permitted by an exchange of reports, the parties should seek to discuss the scope of the issues under consideration.
  • If scientific analysis is needed, the parties should attempt to agree what is to be analysed and by what method (unless the approach is well established and unlikely to be contentious). The costs of doing this are likely to save costs overall.
  • Co-operation is essential to ensure the experts focus on the correct tasks using an appropriate level of resources and limit their reports to those issues on which it is agreed expert evidence is to be given.

Legal and expert representatives' unreasonable conduct can lead to costs penalties

It has been seven years since Lord Justice Jackson published his final report on legal costs and it has become reasonably common to read a decision in which a party was penalised for unreasonable behaviour in court proceedings. However, Arroyo and others v. Equion Energia Ltd (formerly known as BP Exploration Co (Colombia) Ltd) [2016] EWHC 3348 (TCC) is worth a mention because the unsuccessful claimant was penalised in part for the unreasonable behaviour of its experts.

In brief, Arroyo confirms that the court will, when deciding whether to order the payment of indemnity costs, consider and assess the conduct of both a party's advisers and experts. The judge penalised the unsuccessful claimant by ordering indemnity costs based on: (i) the service of unreliable schedules of loss whose later amendments affected the progress of proceedings; (ii) a misleading, interdisciplinary approach to expert evidence which resulted in defective evidence; (iii) the Claimant's refusal to accept a reasonable settlement offer in the form of a Calderbank offer; and (iv) the Claimant's deliberate and serious breach of an order limiting expert evidence by its service of a new expert report five weeks before the trial which was in itself defective.

As stated above, it is crucial that litigants, lawyers and experts all work together in litigation from the outset – and engage with the other party – to ensure a case is handled as swiftly and efficiently as possible as well as justly and at proportionate cost.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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