In our previous article we looked at some of the lessons that can be learnt from the case of Imperial Chemical Industries Limited v Merit Merrell Technology Limited. So numerous are the points that can be drawn from this case that the lessons needed to be split into two parts. Here we look at the criticisms the judge made of the expert’s evidence.
By way of reminder of the background to the case, this was not the parties’ first appearance before the court. This was a quantum trial which followed a trial on liability in 2017 and was the sixth judgment in the proceedings between the parties.
The case concerned work performed by Merit Merrell Technology (“MMT”) for ICI at a paint manufacturing plant. The project took longer than originally anticipated and exceeded the initial budgeted costs. ICI withheld payments from MMT and in the liability judgment Fraser J found that ICI had decided that the best way to keep the project cost down was to push MMT to insolvency. Eventually, it dismissed MMT from site alleging repudiatory breaches of contract.
ICI alleged that a large proportion of MMT’s work were substantially defective and sued MMT for the recovery of alleged overpayments. At the trial on liability Fraser J concluded that ICI had repudiated the contract. The quantum trial therefore focused on the value of MMT’s works as well as a counterclaim for damages. ICI’s case was supported by expert evidence which came in for substantial criticism from the judge. Here are a few of the learning points that can be taken from the judge’s comments in relation to the use of expert evidence.
1. Watch out for late expert evidence
ICI sought to submit a “supplemental note” from one of its experts on the first day of the trial. The note was in effect a second expert report. The expert had embarked on the analysis set out in the report without giving any notice to his opposite number. The judge concluded the only reason for hiding the exercise until after the trial had started was to cause maximum disruption to MMT. He went on to say:
“These sort of litigation tactics are no longer fashionable (if they ever were), are not acceptable (and never have been) and are not in accordance with any element of the Civil Procedure Rules or the overriding objective.”
2. Experts should not take a position on the facts or the law
It goes without saying that in many cases the parties are going to disagree on the facts and the correct application of the law. It is not the experts’ role to pre-judge which way these arguments may fall. If there are calculations which may differ depending on the court’s determination of the facts and the law then the experts should give those different options. Here ICI’s expert failed to provide an alternative valuation if ICI’s argument was not accepted. The judge stated there was “no good reason for this omission”. He went on to say:
“Expert witnesses should not embark upon such primary challenges to the facts. If there are two versions of the facts, experts should consider them both. They should not choose which version is correct; that is the function of the court.”
3. Experts should not argue a case which isn’t pleaded
Part of the case concerned the applicable rates for work undertaken by MMT. ICI’s expert put forward an argument that the appropriate rate was MMT’s actual costs. This was not pleaded as part of ICI’s case. Taking this approach did not help make the judge warm to ICI’s expert whose approach to his evidence was described as “wholly unsatisfactory”. On the other side of the fence, MMT’s expert found favour with the judge for taking the contractual agreement between the parties as his starting point and then performing his exercise independently.
4. Experts need to act independently
Whilst on the topic of independence, ICI’s experts failed to persuade the court of their impartiality due to the approaches they took to the giving of evidence. There were two experts in the liability trial and two in the quantum trial. The judge commented:
“It cannot pass unremarked that all four of the different experts called to substantiate ICI’s case in these proceedings have all been found to have been lacking independence...If it is a coincidence, it is a remarkable one…It is also a matter of concern that in a TCC case, with the sums at stake exceeding 10 million, there should be such a preponderance of partisan experts, all called by the same party.”
5. Watch out if your expert has been subject to previous judicial criticism
The judge’s view of ICI’s experts wasn’t helped by the previous appearance of one of the expert’s before the court. On that occasion, he was criticised for presenting a one-sided picture. Whilst previous judicial criticism did not mean that an expert could not give reliable and helpful evidence in other cases, the judge thought that the expert had not taken on board the previous criticism. He had again presented a one-sided view and remained partisan.
6. Ensure experts adhere to the principles that govern expert evidence
Having an expert who is found to be credible and supports your case can be crucial to winning or losing. However, that does not mean that experts should stray into being partisan. Experts are called to assist the court, not to serve the party instructing them. Fraser J provided a useful summary of the key principles governing expert evidence, drawn from The Ikarian Reefer  case. The main points provide a useful conclusion to the lessons that can be learnt from this litigation:
- Ensuring experts of like discipline have access to the same material. Parties should not provide material which is not made available to their opponent’s expert.
- It is not for the expert to identify which version of the facts they prefer.
- Experts should not take a partisan approach on interim applications.
- Highlighting the importance of the meeting of experts under CPR Part 35.12.
- If late material emerges which needs to be considered by the experts, notice should be given to the other expert as soon as possible. Except in exceptional circumstances, no expert should produce a report during a trial that takes the other side by surprise.
- Experts and legal advisers need to take very careful note of the principles which govern expert evidence.
7. An advert for adjudication?
So, the outcome of all of this – a valuation of MMT’s works which was barely 1% more than the amount awarded to MMT in the adjudications. When taking into account the legal and expert’s fees which were in the millions of pounds, the judge described the litigation as “something of an advertisement for adjudication”.
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