Sometimes you cannot help wondering if professional advisers actually read (let alone inwardly digest) what judges say in cases that matter a lot to the advisers' clients.
In Balmoral Group Ltd v Borealis (UK) Ltd  EWHC 1900 (Comm), Mr Justice Christopher Clarke spelt out what he expected when it came to expert reports. They should:
- Append what they say they appended
- Identify clearly and accurately the facts on which they are based
- State clearly and prominently any key points of disagreement with the opposing side
- Include reference to facts known to the expert which have (or may have) a significant bearing on the issue, even if unfavourable to the client’s cause.
They must also be as a concise as possible.
Fast forward to the very same Mr Justice Clarke speaking on day 21 of the Kingspan plc v Borealis UK trial in June 2012:
"The expert evidence for both parties, leaving aside the tank design expert, and leaving aside the legal experts, and leaving aside the finance experts, runs to 1,137 pages. That is more than my copy of the Old Testament, the New Testament and the Apocrypha. It is true that in my copy of those works they are in single spacing, but in my copy they are in 12 point font, whereas one of the largest reports appears to me to be in 10 point font."
When on earth was he supposed to read all this material, he mused, before continuing in blistering fashion:
"The parties have swamped the court with a vast amount of material, which they have been preparing over several years … Experts' reports have been filed of considerable complexity and in ordinate length, with voluminous appendices and considerable repetition or overlap … The inordinate size of the material and scattergun approach adopted, particularly by the claimants, is an enemy to understanding."
The Borecene factor
In these two heavyweight product liability cases, the claims centred on Borealis's bespoke metallocene polymer called "Borecene". Both Balmoral and Kingspan complained that Borecene had caused tens of thousands of rotationally moulded polyethylene oil storage tanks to crack. Balmoral had manufactured 55,000 such tanks, of which approximately 5,000 had failed; Kingspan had manufactured 115,000, of which 25,000 had failed.
A core question for the court was whether Borecene contained a defect that was responsible for the failure of the tanks. Balmoral argued that Borecene was deficient in its resistance to stored oil (kerosene). Kingspan said that Borecene’s ultraviolet protection package was deficient, so that in heat and sunlight (primarily in sunny Ireland and the United Kingdom) the tanks ran a greater risk of cracking.
Balmoral claimed losses in excess of £70m; Kingspan claimed losses exceeding £100m - plus costs in each case.
Mr Justice Clarke's decision
In the two claims, 16 technical experts, some of them world leaders in their field, gave evidence spanning polymer properties and molecular structure, polymer engineering, rotational moulding, UV stabilisation, finite element analysis and tank design.
Dismissing both claims, Mr Justice Clarke said that the claimants had failed to establish that Borecene was not a suitable raw material for use in the manufacture of an above-ground oil storage tank. The tanks had failed, he concluded, because of poor rotational moulding practices by the claimants, inappropriate tank designs, inappropriate incorporation of pigments and inadequate quality assurance procedures.
Given the judgment in the Balmoral case - when the court made itself very clear on the subject of expert evidence - readers will be asking themselves two obvious questions:
- Did the lawyers in Kingspan just ignore the judge’s comments in Balmoral about the state of expert evidence?
- Did the claimant’s experts in Kingspan simply fail to learn the lessons from the Balmoral case?
A clue is provided by the judge in paragraphs 740 to 745 of the Kingspan judgment, where he summarised his impression of the reports and evidence given by several of the technical experts. None of the witnesses' integrity was questioned, but some of the judge’s observations should be seen as a warning light for those relying on experts in highly technical cases.
Take, for instance, the claimant’s UV expert who, the judge said, was "honest and competent". However, the court found it "surprising" that an entire set of relevant test results had been omitted from a report. The evidence of an expert in the field of rheology was also "not entirely easy to follow (perhaps because of language difficulties) and … some of it apparently contradictory. Some was not vouched by or was inconsistent with the sources which were said to support it". The judge "was surprised" too at the rheology expert’s inability "to recognise what the x and y axes of a molecular weight distribution graph in her report represented".
Nor was Mr Justice Clarke particularly impressed by one of the other experts on UV resistance who carried out conventional comparator tests:
"When these showed no significant difference as between Borecene and [other grades] in terms of UV resistance [in contradiction of his clients’ case], he stopped them." And later "He was asked to presume that the tanks cracked because of the raw material … I was left with an impression that he was more focused on establishing evidence of a difference in order to support the presumption than on a more open enquiry as to the causes of failure."
The judge was especially scathing about Kingspan’s rotational moulding expert:
“He used to work for Dow, a competitor of Borealis, all his working life where he developed a good working relationship with Kingspan … During his time at Dow he carried out a number of tests to which he did not refer in any of his reports, some of which … revealed concerns that he had about the brittle failure resulting from the [pigmentation] process used by Kingspan. I found his evidence of limited assistance. His evidence on topics other than rotomoulding and processing is not expert and [the defendants’ expert’s] experience on those topics is considerably greater."
A running argument
The judge made the significant observation that the experts' reports were prepared against the background of "a running argument between the parties as to whether or not Kingspan was bound to state exactly what caused the tanks to fail".
Borealis argued that they could not understand the case against them without this information and Kingspan retorted that it was not necessary for them to establish exactly why the tanks had failed, provided that a defect in Borecene was the cause.
Mr Justice Clarke acknowledged Kingspan’s point, "provided that a 'defect' is understood not merely as a difference between Borecene and other materials but as a characteristic which makes it incapable of being used to rotomould satisfactory tanks". Having said that, what precisely caused the tanks to fail - and what exactly was the reason for any increased tendency to degrade - "is of substantial evidential significance".
Impact on experts' reports
The ongoing row between the lawyers seemed to have a more deleterious effect on the reports of the claimants’ experts than on those of the defendants’ specialist witnesses.
Of course, it was (generally speaking) not up to the defendants to prove anything – although if the defendants’ experts were going to suggest any alternative cause of tank failure, they would have to explain why they thought that. Nevertheless, the narrower approach adopted by the claimants appeared to have the effect of focusing its experts’ attention only on the differences between the defendants’ Borecene and other resins available to Kingspan, without sufficient regard to the need to prove that any difference was a defect (as defined by the judge) that caused the tank failures.
The judge’s approach was much closer to the broader view taken by the defendants’ technical experts, in which factors such as processing, tank design, pigment incorporation and quality assurance procedures played a much more prominent part in the discussion about what had gone wrong.
Lessons to be learnt
So what are the lessons for practitioners, litigants and insurers in complex product liability cases?:
- It is dangerous for lawyers or litigants to channel the thinking or approach of experts.
- It is inadvisable to rely on technical reports that make no reference to all the available test data or that only refer to favourable data.
- Weight should be given to tests that closely reflect the real-life experience of the subject matter of the litigation, rather than to tests that simply have the greatest chance of supporting the forensic aims of one of the parties.
- Test regimes should not be abandoned at the point where data ceases to be advantageous to one party and it is likely that, if they were continued, adverse data might be produced.
- The expert must have the expertise claimed.
- The expert must be free of any substantive connection with either of the parties.
- Reports should be as concise as possible. In cases where (as here) the defendants produced substantial technical evidence, the court will look carefully at the claim (and the extent of the technical evidence behind it) advanced against them and to which they have had to respond.
- Experts support a case best when their position is consistent. At paragraphs 743 and 744 of his judgment, Mr Justice Clarke alluded to the shifting position of Kingspan’s experts, even in reports disclosed just six weeks prior to a three-month trial that was heavily dependent on a well-argued technical case.
- Finally, practitioners and their clients should consider the impact of any of the above factors on their expert witness when crossexamined at trial. During the Kingspan case, experts had a more uncomfortable time than they would have done if this point had been taken into account.