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Matters not which side of their bread is buttered

In litigation, it’s sometimes necessary to obtain evidence from an expert to support your case (for example in a boundary dispute it may be necessary to instruct a surveyor) but who does the expert owe their duty to?

You would have thought that it would be to the party who is instructing the expert; after all they are paying for the expert’s service.

However this is not the case, and the Civil Procedure Rules make it clear that the expert’s duty lies with the Court (and not to the person who instructed them) in order to guarantee the independence of the expert.

A recent case

The issue of ‘independence’ was highlighted in the High Court case of Bank of Ireland (UK) Plc v Watts Group Plc.

In that case a developer had borrowed money from the Bank for a development, and part of the condition for the loan was that the Bank would appoint a quantity surveyor to review the costings for the development.

Accordingly, the Watts Group was instructed by the Bank to prepare a report. The developer drew on the loan but subsequently went into liquidation with the bank suffering a £750,000 loss.

The Bank argued that the Watt Group’s report was negligent and that had it been properly prepared the Bank would not have allowed the loan to be drawn. The Watts Group denied any negligence and instead argued that it was the Bank’s own negligent decision to lend that caused its loss.

In the proceedings, the Bank relied on expert evidence from their own quantity surveyor, Mr Vosser. However, the Judge was highly critical of Mr Vosser and decided that he wasn’t independent, or reliable, and therefore the evidence of the Watt Group’s expert would be preferred wherever there was disagreement between the two experts.

The reasons for this were:

  • Mr Vosser’s principal client was the Bank who had provided him with the majority of his work in the last few years – the Judge felt that the closeness of this relationship had affected Mr Vosser’s impartiality and independence
  • Mr Vosser had shown a lack of realism and his criticisms of the Defendant were based on an unrealistic expectation of what the Defendant had been required to do under its retainer with the Bank
  • He had applied the wrong test for negligence – instead of considering what a reasonable competent surveyor would have done, he told the Court what he would have done
  • He had attempted to mislead the Court – selectively quoting from RICS guidance
  • He had adopted an unreasonable approach – failing to make concessions at the experts’ meeting and when giving evidence

As a consequence, the Bank’s claim failed as the Judge found that the Bank would have loaned the money anyway (notwithstanding the report which had been prepared by the Watts Group).

A cautionary reminder

This case shows the importance of ensuring that experts are aware of, and comply with, their duties to the Court and that expert evidence presented to the Court should be wholly independent.

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Luke Patel

Partner and Head of Dispute Resolution
Commercial Dispute Resolution
LPatel@LawBlacks.com
0113 227 9316
@LukeLawBlacks
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