The frequency of disputes involving real property means that many property professionals, valuers in particular, will be asked to act as an expert witness at some point in their career. This can be a lucrative line of business and there are numerous practitioners who do little more than act as experts. However, the way expert evidence is gathered and delivered, and the status given to expert witnesses, has changed considerably over the last few years. Anyone thinking of acting as an expert witness needs to understand the risks and responsibilities involved before agreeing to take on this role.
Status of expert witnesses
For many years both factual and expert witnesses enjoyed immunity from prosecution in respect of deficiencies in their evidence. For expert witnesses this position changed following the decision of the Supreme Court in Jones v Kaney (2011) in which Lord Dyson held that:
“…immunity of expert witnesses from liability to their clients for breach of duty (whether in contract or negligence) can no longer be justified…”
Since Jones v Kaney there have not been any reported judgments finding an expert witness liable for deficient evidence. However not six months after this landmark decision its impact was felt by one particular expert. In Warner v Penningtons (2011) Mr Warner alleged that his claim was settled for too little as a result of negligent advice from his solicitors, Penningtons. Penningtons denied the allegation but also argued that if the claim had been under-settled it was due to the negligent advice of their expert witness. The expert was joined in to the proceedings but made an application for summary judgment on the basis that there was no prospect of showing that she was negligent. She also made an application to strike out the claim on the ground that she was immune, but this was stayed pending Jones v Kaney and then dropped. The Court, at both first instance and on appeal, found for the expert. This appears to be one of the first cases where the loss of immunity led to an expert having to mount a proper defence against an allegation of deficient evidence.
Whilst there has not been a flood of claims against expert witnesses, we anticipate this will be an area of increasing exposure. Just as claims against solicitors and barristers in respect of lost litigation are becoming more prevalent, we are also seeing a gradual increase in the volume of claims against experts. We are therefore likely to see further judicial commentary soon.
Set out below are examples of risks that any professional contemplating acting as an expert should be aware of in order to protect themselves, not only from potential claims, but also the reputational risk of criticism in a public court hearing.
Independence and impartiality
Part 35 of the Civil Procedure Rules (CPR) sets out the rules applicable to expert witnesses in court proceedings. Most other forums, such as arbitration, will expect the same. CPR 35.3 confirms that the expert’s overriding duty is to the Court and not the party providing instructions or payment. It states:
“It is the duty of experts to help the Court on matters within their expertise”
“This duty overrides any obligation to the person from whom the experts have received instructions or by whom they are paid”
Prospective experts must therefore ensure that they obtain details of all parties at the outset, including the opponent expert witness, and consider carefully whether their involvement would create any risk of their impartiality, independence and objectivity being compromised.
Even if there is only a small risk of the expert being criticised for being partisan that should be drawn to the attention of the instructing party at the earliest possible stage. The evidence of a partisan expert witness will carry far less weight for a judge than that of someone who is wholly independent. If this were to become an issue the expert would be well-advised to have the ability to say that it was a risk that the client knowingly took, so the expert cannot be criticised.
Every prospective expert witness must consider carefully whether he or she has the appropriate expertise to assist the court. The dangers of over-selling should not be underestimated. Of particular relevance to experts in the property market will be their sector and geographical experience. Judges regularly prefer the evidence of the expert who is most familiar with the market in question.
Again, experts should be frank about their CV and bear in mind that the party instructing them may not know what the “right” experience looks like. Full disclosure will give the expert the maximum protection.
Terms and conditions
Expert witnesses should agree and document their terms of appointment in much the same fashion as any other professional appointment so as to ensure maximum certainty and protection. The terms should specify at least:
- The scope of the appointment
- The basis upon which the expert will be paid
- Any agreed liability caps or exclusions
- Any agreed timescales for the expert’s services
It is essential that an expert receives clear and concise instructions so that the scope of the duty to the instructing party will not be in any doubt. If there is any uncertainty always clarify the position, and remain within the scope of any instructions, bearing in mind there is a requirement to give full and frank evidence to the Court. To prevent any tensions arising between these two obligations any other issues or developments should be raised as soon as possible, so that a decision can be made as to whether they should be addressed by the expert or not. Clear lines of communication and good record-keeping are important risk management tools in this regard.
The wide-ranging Jackson reforms have not just impacted solicitors; there are important points arising from the reforms for experts to consider. Significant issues arise regarding the preparation of a litigant’s Precedent H costs budget. An expert will be asked to provide an estimate of their fees at an early stage of the proceedings. Unless there are good reasons for a change, such as the addition of new issues for the expert to address, the litigant is likely to be held to those costs figures at the end of the proceedings. If the fees are underestimated the client may suffer a shortfall. On the other hand, if the estimate is too high this may allow the opposing party to also submit an unreasonably high figure, leading, if they are successful in the litigation, to the client paying a greater sum to the opposing party in costs than should properly be the case. Careful consideration and the use of assumptions/ caveats are required and estimates should be updated and reviewed regularly.
In Phillips v Symes (2004) Peter Smith J held that courts may make orders for costs directly against expert witnesses who cause significant expense to be incurred, and do so in flagrant and reckless disregard of their duties to the Court. It is too early to know whether an expert who fails to properly consider the level of fees provided to instructing solicitors will be considered to have been sufficiently reckless and flagrant to have a costs order made against him/her, but the potential is there.
Due to the changing risk landscape that experts now face and the criticism that has recently been directed by the court at poor quality experts, training is often advisable, particularly for those without prior experience of giving evidence in court. A prime example is Board of Trustees of National Museums & Galleries v AEW Architects (2013) in which an expert was described as “…wholly unimpressive, possibly partly because he had never given expert evidence before…it was clear that he had given little or no coherent thought to the issues in the case”. As a result, the judge found the expert “wholly unconvincing about all aspects of liability…”
This is obviously an extreme case of the Court criticising an expert, although it should be noted that the judge, Mr Justice Akenhead, does have a history of criticising experts (see Igloo Regeneration v Powell William Partnership , Walter Lilly v Mackay , and, most recently, Weatherford Global Products Limited v Hydropath Holdings Limited and Others ).
It should go without saying that it is important for an expert to be as prepared as possible for what the appointment entails, such as being aware of the duties that he/she owes and tasks he/she will have to undertake, including both report-writing and, potentially, giving evidence at trial.
A risk that should not be overlooked is the impact that an expert appointment can have on commercial relationships.
Notwithstanding the requirement of independence, experts will often be perceived as taking sides in a dispute. Property professionals will need to consider whether the risk of this perception may cause them difficulties in maintaining existing commercial relationships or building new ones. We know of firms in the property sector, and elsewhere, who do not take on expert witness work as a matter of principle for this reason alone. The flipside of course is that when they need help from a fellow professional, assistance for the firm which refuses to act as expert witness can be harder to come by.
Finally, there are regulatory risks at play for RICS members in particular. RICS published the fourth edition of its Practice Statement and Guidance Note “Surveyors acting as expert witnesses” in July 2014: http://www.rics.org/uk/ knowledge/professional-guidance/practice-statements/ surveyors-acting-as-expert-witnesses-4th-edition/. It is mandatory for RICS members to comply with the Practice Statement and there may be disciplinary consequences for any failure to do so. The Guidance Note, whilst not mandatory, represents best practice in this area and should therefore be borne in mind in all relation to all instructions to act as an expert. Choosing an expert witness Many of the issues referred to above apply equally to the party selecting and instructing an expert witness (and their advisers). Prospects of success in litigation can be significantly increased by:
- Selecting the right expert with the right expertise, qualifications and experience
- Ensuring that the expert is instructed to consider all relevant issues
- Guiding the expert through the process and supporting him or her whenever necessary
This should be the role of the solicitor advising on the litigation, but there may be cases where the client has greater knowledge of the relevant issues, and so will be able to give important assistance with a view to maximising these prospects.
Those selecting and instructing experts should have regard to the new guidance document published by the Civil Justice Council in August 2014, which can be found at http://www.judiciary.gov.uk/wp-content/uploads/2014/08/ experts-guidance-cjc-aug-14-amended1.pdf. This guidance is expected to replace the Protocol for the Instruction of Experts, which currently forms part of Practice Direction 35, in the next round of amendments to the Civil Procedure Rules in the autumn.
The role of an expert witness can be onerous and caution is required for those considering accepting an expert appointment. However, in many respects the risks are not dissimilar to those faced by property professionals in their regular work. For firms with appropriate risk management procedures in place expert witness work can be a lucrative and professionally and intellectually rewarding line of business.