The appointment of expert witnesses should be approached with caution following the recent decision of the Technology and Construction Court in Bank of Ireland v Watts Group.

The Court questioned the independence and reliability of an expert witness, who had a longstanding relationship with Bank of Ireland (BOI) and found that he had not complied with his duties to the Court.

Background to the case

BOI lent money to a company to develop a residential property development in York. The company went into liquidation and could not repay the loan. BOI suffered a loss of approximately €750,000. BOI argued that they had relied on an Initial Appraisal Report (IAR) prepared by a quantity surveyor, Watts Group plc (Watts) which BOI alleged was negligently prepared. BOI submitted that if the report had been correctly prepared, they would not have allowed the company to draw down the loan and they would not have suffered any loss. Watts denied any negligence and BOI and Watts both appointed independent quantity surveyors as witnesses to support their arguments.

Court critical of BOI witness

The Court was very critical of BOI’s expert witness (the Expert). The Court’s main concerns were:

  • Lack of independence – the Court noted that the BOI was the Expert’s biggest client and he had acted a number of times on their behalf. The majority of these disputes had been resolved by alternative dispute resolution and had not made it to Court. The Court took the view that the Expert did not know the difference between his duties to the Bank as an advocate in mediation and his duties to give expert evidence to the Court

  • Lack of realism – the Court found that the Expert had a completely unrealistic view of what Watts were required to do in preparing their IAR. Watts had charged £1,500 for preparing the IAR on the basis that they were not required to complete their own calculations of certain costs. In criticising Watts approach to the IAR, the Expert incurred fees of £24,000 in preparing two reports which filled two lever arch files. The Court felt that this showed that the Expert had an unrealistic expectation of the work Watts was required to carry out and was willing to go to any lengths to strengthen BOI’s argument.
  • Attempts to mislead the Court – The Expert vouched his argument by reference to the RICS guidance on obligations of monitoring surveyors. However, in quoting the text he omitted sections of the guidance note which would have weakened his argument. The Court found that this was a clear misuse of a source document and a breach of his duties to the Court.
  • Application of the wrong test – the Court found that the Expert was not applying the correct test. Rather than look at what a reasonable competent monitoring surveyor would have done and use this as the standard to test Watts’ performance, he examined in great detail what he would have done himself.
  • Unreasonableness – the Court criticised a number of the Expert’s actions as unreasonable. For example, he had made no concessions during the “without prejudice meetings” and used them to raise new matters. The Court remarked that they had never before seen a joint statement of two experts which did not contain any agreement and found that this was due to the Expert’s failure to make any concessions at all.

Lessons to be learned

This case highlights the importance of choosing the appropriate expert witness who is aware of their duties to the Court. While it might seem sensible to choose a person with whom you have a good working relationship, this may affect their ability to act as an independent and reliable witness in assisting the Court to get to the truth. It is important to remember that the expert witness owes a duty to the Court and not the person who is paying their fees.

The Governor and Company of the Bank of Ireland and anor v Watts Group plc [2017] EWHC 1667 (TCC)