Legal Watch:Personal Injury18th June 2014Issue: 023

In This Issue:

• Civil Procedure/Expert Witness

• Occupiers’ Liability

• Jackson/Mitchell

Civil Procedure/Expert WitnessThe commercial case of Rowley v Dunlop and others [Lawtel

17/06/2014] is of general interest when considering the

independence of an expert witness.

An additional claim was brought against the appellant/

defendant under CPR Part 20 for compensation for losses

caused by his alleged breaches of director’s duties. The

company’s claim against the defendant had been assigned to a

claims management company (the CMC) which then assigned

it to the respondent/claimants on terms that, were they to

succeed, the claimants would pay the 30% of the recovery

and a further 45% representing sums owed to the CMC. The

company had sought to rely on a draft forensic accounting

report prepared by an expert. The expert’s biography stated

that he was a partner in a firm, which was operated by its

owner. The owner was also the sole director of the CMC. The

owner of the firm and the expert had considered whether

there was a conflict of interest and had concluded that there

was not. The owner stated that he was only involved in the

CMC as a director who was paid on an hourly basis, was not

a shareholder and had no financial interest in the outcome of

the litigation. The defendant applied to strike out the claim on

the basis that the expert’s report was fatally flawed because

of his conflict of interest arising from his connection with the

owner. He alleged that the expert had deliberately misstated

in a declaration in his report that he knew of no conflict of

interest. The judge at first instance held that there was no

conflict of interest as, although the owner of the firm owed

director’s duties to the CMC, the expert did not owe it any

duty and there was no evidence that the expert, or the firm in

which he was a partner, would benefit from the litigation. The

question of whether the contents of the report showed that

the expert could not be seen as independent was adjourned

pending the instant appeal.

The claimant appealed and submitted that (1) the failure to

provide evidence as to the expert’s connections with the CMC

meant that the court was entitled to infer that there might be

a greater degree of involvement than that which had been

disclosed, such as possible interests in the CMC’s shares

or payments made out of sums recovered by the claimants;

(2) the expert was to be criticised for giving an unqualified

declaration when he knew of his connection with the owner

of the firm and the firm itself.

‘The essential character of witness evidence was that it should be independent, objective and within the expert’s area of expertise’Dismissing the appeal the High Court judge held that it was

unusual on a strike out application to determine whether a

witness who was to give expert evidence was lying, without

having heard oral evidence. However, the case had been

put on the basis that there was a conflict and that the

expert had deliberately misstated that there was not. The

existence of a conflict of interest might not justify rejecting

an expert’s report, but a deliberately untruthful denial of

that conflict might make it appropriate to reject the entire

report. The judge had found that there was no conflict so

the declaration was not untruthful. The essential character

of witness evidence was that it should be independent,

objective and within the expert’s area of expertise. An

expert’s connections with parties could compromise that

character. The court would rarely admit expert evidence

where the expert had a financial interest in the litigation.

The circumstances would dictate whether the court would

admit evidence if there was a conflict of duty. A personal

connection with a party might influence the expert’s

evidence, but that would not normally of itself lead to its

rejection but would go to the weight of the evidence. The

court could not find a conflict of interest from inferences of

the kind that the defendant had suggested. The fact that the

owner of the firm in which he was a partner was a director

of the CMC was insufficient to show that the expert had a

financial interest in the proceedings. It was clear that he was

connected to the owner of his firm and therefore arguably to

the CMC, but the risk of any conscious or unconscious bias

should be explored in cross-examination at trial. The issue

went to weight rather than admissibility. The report was not

inadmissible on the conflict ground.

The claimant’s criticisms had some force. It was clearly

incumbent on an expert to disclose facts which could

be taken into account on his ability to give independent

evidence. The court agreed with the owner of the firm and

the expert that there was no conflict but the fact that they

had considered the matter suggested that there should

have been disclosure of some facts.

Occupiers’ LiabilityAlthough no personal injury was involved, the case of

Stagecoach South Western Trains Ltd v Hind and another

(2014) EWHC 1891 (TCC) is relevant to such claims.

The claimant train operator claimed the cost of repairing

damage to a train, and other consequential costs, against

the first defendant landowner and the second defendant

tree surgeon after a tree on the first defendant’s land fell

onto a railway line.

The tree was at the end of the first defendant’s garden in an

area that was uncultivated and covered with ivy, brambles

and nettles. The tree was an ash and about 150 years

old. It was originally made up of three separate stems.

The northern stem had fallen many years before the first

defendant bought the property. The two remaining stems,

the eastern and the western, grew vertically out of a common

trunk. The second defendant had carried out some work

on the western stem three years before the eastern stem

fell onto the railway tracks. He climbed the western stem

for the purpose of clearing dead wood. After the collapse

an empty train collided with the trunk and was damaged.

The tree was in apparently good condition at the time of the

collapse. The eastern stem fell because the fork or union

between the stems was an “included bark union”, in which

the bark of the two stems pushed against one another and

caused a crack to develop, and because of decay that had

spread from the wound left by the fallen northern stem.

The claimant alleged that the first defendant owed a duty

to have the tree regularly inspected by an arboriculturalist;

if that had happened, the arboriculturalist would have been

obliged to carry out a detailed inspection of the base of the

tree and would have discovered the crack and the decay.

Finding in favour of the defendants, the High Court judge

held that a reasonable and prudent landowner was not

obliged, as a matter of course and without any trigger or

warning sign, to pay for an arboriculturalist to carry out

periodic inspections of the trees on his land. A closer

inspection by an expert was only required where something

was revealed by an informal or preliminary inspection which

gave rise to a cause for concern.

The authorities indicated that an ordinary landowner,

required to act reasonably and prudently, was obliged to

carry out regular preliminary/informal inspections of the

trees on his or her land, particularly where those trees

bordered a highway, a railway or the property of another.

The first defendant was capable of carrying out a meaningful

preliminary/informal inspection of her trees. She was an

educated woman and a regular and enthusiastic gardener

who knew a reasonable amount about trees. She carried out

regular informal inspections or observations of all the trees in

her garden. She carried out those inspections properly. The

tree was apparently healthy. The included bark union would

not have alerted an ordinary landowner to any problem and

was in any event covered in ivy. The wound too was covered

by ivy. A reasonable and prudent landowner was not obliged

to inspect the trunk of an apparently healthy tree which was

difficult to access and covered in ivy.

‘A reasonable and prudent landowner was not obliged to inspect the trunk of an apparently healthy tree which was difficult to access..’ There was nothing that should have alerted the first

defendant, or put her on notice, that the tree was anything

other than healthy, or required a closer inspection by an

arboriculturalist. The claim in tort against her therefore

failed.

The second defendant was a tree surgeon not an

arboriculturalist. The first defendant told him what work she

wanted carried out. He might have expressed an opinion as

to how that work might be carried out but his opinions or

recommendations did not go beyond that. He had not been

asked to inspect the tree and did not do so. His contractual

obligations did not require him to inspect or advise

generally about the tree. His duties were circumscribed by

his contractual obligations. His work on the western stem

did not create sufficient proximity between him and the

claimant. There was no duty to warn and if there had been it

would only have been triggered by the discovery of a clear

defect or something that was obviously dangerous. The

claim against the second defendant also failed.

Jackson/MitchellThere are five cases that broadly sit under this heading this

week.

The thrust of Jackson/|Mitchell is compliance with rules,

practice directions and orders, including pre-action

protocols. Even if a party is successful it may still be

penalised in costs if its pre-action ‘behaviour’ is open to

criticism. That is what happened in Lovell Partnership and

another v Merton Priory Homes (2014) EWHC 1800 (TCC).

A declaration had been made in favour of the claimant

on the interpretation of the clause in issue. In light of that

previous judgment, the defendant accepted that it should

pay the claimants’ reasonable costs of the proceedings.

The costs claimed were £55,000. The defendant submitted

that the costs claimed by the claimants and the costs it had

incurred had been increased by the claimants’ conduct,

particularly in failing to comply with the pre-action protocol.

It was the defendant’s case that the claimants should

recover only two-thirds of their costs.

‘(The delay) had resulted in the respective solicitors having to review a large amount of correspondence when preparing for the instant hearing’The High Court judge held that was no real substance in

the complaint that the claimants had not complied with the

protocol. The letter from the claimants’ solicitors had set

out their position sufficiently clearly. Although the claimants’

argument became more nuanced in the course of oral

argument, the thrust of it was largely unchanged. However,

their delay in bringing the claim had unreasonably increased

the costs to both sides. The claimants had known their

position at the end of 2010 but had not issued proceedings

until March 2014. That had resulted in the respective solicitors

having to review a large amount of correspondence when

preparing for the instant hearing. Further, the claimants

had refused to give an undertaking to meet any costs order

made in favour of the defendant. That issue had been live

for only a month and had therefore not added greatly to the

costs. The claimants’ costs were substantially less than

those claimed by the defendant, even though they had the

carriage of the action. The costs incurred by both parties

should have been less than they were. The claimants were

entitled to £45,000, which represented a proportionate

amount after making a modest reduction to reflect those

costs that were unnecessarily incurred by the defendant.

CommentThose handling cases in the pre-litigation stage should

be aware of the requirements of the relevant pre-action

protocol. If there is no specific pre-action protocol the

Practice Direction – Pre-action Conduct will apply. Steps

should be taken to ensure that the protocol is complied with

but in the light of cases like this, it is increasingly important

to note and record non-compliance by another party. As can

be seen this could lead to an adjustment in costs later, even

if the other party is successful overall.

As the case of Warners Retail Ltd v National Westminster

Bank Plc and another [Lawtel 13/06/2014] shows, the courts

continue to adopt a robust approach to compliance with

CPR, even where an application is not one for relief from

sanctions.

The claimant alleged that the defendants had missold to it

interest rate swaps, and in particular that they had given

negligent advice in breach of their duties of care. The trial

was due to begin about three weeks after the hearing of this

application and it was common ground that, if the claimant

was granted permission to adduce the expert evidence, the

trial would have to be adjourned.

The defendants contended that it would be contrary to

principle to allow the claimants to adduce the expert

evidence because it had not pursued its case diligently. They

relied on the principles expounded in Mitchell to urge the

court to exercise its discretion against granting permission.

The claimant argued that there would be an inequality of

arms if permission was not granted because it needed

the expert evidence to establish the defendants’ alleged

breaches of duty and the existence of a body of expertise

on interest rate swaps. It further argued that its application

was not covered by the Mitchell principles because it was

not seeking relief from sanctions under CPR 3.9.

‘Adjourning the trial could have caused disruption to other court users’Refusing the application, the High Court judge held that it

was unnecessary to determine to what extent the Mitchell

principles were applicable in the circumstances of the

instant case because the overriding objective under CPR

1.1 pointed firmly towards dismissing the application. The

claimant had made much of the need for it to be on an

equal footing with the defendants. However, neither party

would be able to rely on expert evidence at trial and the

claimant could still instruct an expert to help it prepare for

cross-examining the defendants’ witnesses. Accordingly, it

could not be said that a refusal of permission would prevent

the claimant from properly presenting its case. Further,

there would have been considerable expense if the trial was

adjourned at such a late stage and the defendants would

have been prejudiced. Allowing a long-standing trial date

to be adjourned in the circumstances would have been the

antithesis of dealing with the case expeditiously and fairly.

Adjourning the trial could have caused disruption to other

court users and there was no good reason for the claimant’s

delay in bringing the application. Accordingly, applying the

overriding objective, the claimant was not permitted to

adduce the expert evidence.

CommentThis is yet another decision which focuses on the wider

issue of court resources and the impact of orders in one

case on the parties in other, unrelated cases. This theme

has been carried through into the amended wording to CPR

3.8 which came into effect on 5 June 2014:

‘…the time for doing the act in question may be extended by

prior written agreement of the parties for up to a maximum

of 28 days, provided always that any such extension

does not put at risk any hearing date’ (emphasis added).”

The Mitchell approach was also applied rigorously in

Cranford Community College v Cranford College Ltd [Lawtel

18/06/2014].

The claimant/respondent had issued proceedings against

the defendant/applicant for passing off. Directions

were given for the exchange of witness evidence and

subsequently the parties agreed an extension of time for

exchange. The claimant duly served its witness statements

by the agreed deadline but the defendant failed to do so.

It served statements from three of its key witnesses13

days later and then applied for the court’s retrospective

permission to serve those statements. In explaining its

non-compliance, in respect of one witness the defendant

referred to the fact that his wife had been ill and hospitalised

before the deadline for exchange, so that he had been

spending much of his time at hospital or caring for his wife. A

second witness had had to attend unexpected professional

engagements in Cyprus before the deadline for exchange

so that he was unable to finish his witness statements

on time. The defendant provided no explanation for non-

compliance with the deadline in respect of its third witness.

It was common ground that, although the defendant had not

formally applied under CPR 3.9, its application had to be

considered under that rule, in light of Mitchell and the other

relevant authorities since.

Applying those principles, the defendant argued that its

non-compliance was only trivial because its 13-day delay in

serving the statements was unlikely to have prejudiced the

claimant. It also argued that it had provided a good reason

for its failures to comply with the deadline for exchange.

‘...since Mitchell, courts were more particularly required to take into account not only the effect a grant of relief from sanctions would have on the parties, but also the culture of litigants in meeting deadlines...’Allowing the application only in part, the judge held that as

to triviality it was clear that since Mitchell the question of

whether the opposing party was prejudiced by the failure to

comply was less significant. A delay of 13 days, especially

when the trial date was not far away, was not trivial. As

to the alleged good reasons for non-compliance, in the

case of the first witness it was very possible that his wife’s

condition had become the priority in his life to the extent

that the demands of the litigation had seemed to him less

important. On the assumption that that was the case, the

first witness had had an exceptional reason for why his

statements had not been served on time, and accordingly

the court was prepared to grant retrospective permission for

him to serve his witness statements late. As to the second

witness, his reason for non-compliance was unsatisfactory.

His explanation was extremely brief and the court was

left with no way of knowing how important the Cypriot

engagements were or to what extent the second witness

had done anything significant to complete his statements

on time. In the circumstances, it was appropriate to refuse

to allow both him and the third witness, who had provided

no explanation whatsoever for his non-compliance, to serve

their witness statements late. Such a sanction was not

disproportionate. It was important to remember that, since

Mitchell, courts were more particularly required to take into

account not only the effect a grant of relief from sanctions

would have on the parties, but also the culture of litigants

in meeting deadlines, which was to be maintained as much

as possible.

The last two decisions can be contrasted with Warner v

Merrett [Lawtel 16/06/2014].

The applicant/claimant had failed to serve documents

relating to additional costs liabilities for solicitor and counsel

success fees and an after-the-event insurance premium

which CPR PD 43-48 required should be served with the bill

of costs. The respondent/defendant served points of dispute

contending that as a result of that omission CPR 44.3B(1)

required that the success fees and insurance premium had

to be disallowed unless the court ordered otherwise. The

claimant immediately supplied the documents and applied

for relief from sanctions.

He argued that (1) the automatic sanctions under CPR

44.3B did not apply where the documents were served late

rather than not at all; (2) alternatively, relief from sanctions

under CPR 3.9 should be granted because the sanction of

automatic disallowance of additional costs was created

before CPR 3.9 had been amended, at a time when relief

would usually be granted absent prejudice; there was no

disruption to the court; he had attempted to comply with the

practice direction and the defendant could have requested

the missing documents.

Allowing the application, the deputy High Court judge held

that CPR 44.3B(1) was of general application and applied

to all stages of proceedings. The claimant’s omissions were

subject to the automatic sanctions.

‘The decision in Mitchellprovided guidance…but should not be applied like a rule or statute’The decision in Mitchell provided guidance on how to apply

CPR 3.9, but that judgment should not be applied like a

rule or statute. It was not appropriate to focus intensely

and narrowly on the word “trivial” in the Mitchell guidance.

It was necessary to look at the context and the effect of

the breach. The question of triviality had to be seen in the

context of the duty to co-operate imposed on lawyers

involved in Mercantile Court cases. Little weight was placed

on the claimant’s argument that the rule had been devised

before CPR 3.9; to do so would erode the force of the new

rule. The breach was of a general kind and not a total failure.

The consequences of the breach caused inconvenience

to the defendant, not the court. There was no duty on the

defendant’s solicitors to contact the claimant’s solicitors for

the missing information, and they could not be criticised

for not doing so, but the prejudice claimed to have been

caused to the defendant could have been avoided by

sending an email or making a telephone call. Further, there

had been no breach of a court order, no history of default

and the claimant’s solicitors had acted immediately when

they became aware of the omission. In the context, the

breach was trivial or insignificant. Even if that were wrong, it

was just to grant relief in all the circumstances.

A pragmatic approach to a technical breach of the rules was

also adopted in Americhem Europe Ltd v Rakem Ltd and

others (2014) EWHC 1881 (TCC).

The defendant filed a costs budget in the form of Precedent

H annexed to CPR PD 3E. While compliant in every other

respect, it was signed by a costs draftsman. He was included

in the budget as a fee earner, but he had no involvement in

the case other than the preparation of the costs budget.

The third party applied for an order that the defendant was

in breach of CPR3.13 because the costs draftsman was

not a senior legal representative of the defendant and that

therefore the effect of the budget being signed by him was

that it was a nullity. It argued that the consequence of that

was that CPR 3.14 was applicable and the defendant was

to be treated as having filed a budget comprising only the

applicable court fees.

‘...even if the costs draftsman was a legal representative, he could not be considered a “senior legal representative” within the meaning of PD 3E’Dismissing the application, the High Court judge held that

there was no definition of “senior legal representative” in PD

3E or in the CPR. However, CPR 2.3(1) provided a definition

of “legal representative” which was at least persuasive in

considering the meaning of “senior legal representative”

in PD 3E. Viewed overall, CPR 2.3(1) seemed to connote

someone who was representing in a legal capacity, which

was not what was being done by a costs draftsman whose

only involvement was the preparation of a costs budget,

and who did not give any form of legal advice or legally

based representation. Even if the costs draftsman was a

legal representative, he could not be considered a “senior

legal representative” within the meaning of PD 3E. Of the

three fee earners listed in the budget he appeared to be the

least senior, at least by reference to his charging rate, and

moreover as a costs draftsman he was not independently

able to verify that the provision of resources that appeared

in the costs budget was reasonable, particularly as he had

no other involvement in the litigation at all. However, that

did not render the costs budget a nullity. The fact that it

was signed by the costs draftsman was an irregularity.

The information and opinions contained in this document are not intended to be a comprehensive study, nor to provide legal advice, and should not be relied on or treated as a substitute for specific advice concerning individual situations. This document speaks as of its date and does not reflect any changes in law or practice after that date. Plexus Law and Greenwoods Solicitors are trading names of Parabis Law LLP, a Limited Liability Partnership incorporated in England & Wales. Reg No: OC315763. Registered office: 8 Bedford Park, Croydon, Surrey CR0 2AP. Parabis Law LLP is authorised and regulated by the SRA.

www.plexuslaw.co.ukwww.greenwoods-solicitors.co.uk

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The document was in a form which stated that it was the

defendant’s costs budget and was immediately recognised

as such. To hold that it was not would lack any form of reality

or justification. In the circumstances, there was no need for

relief from sanctions. The proportionate and just response,

given that no-one had been significantly disadvantaged

by the irregularity, was to require it to be remedied at the

defendant’s cost and to compensate the third party for the

modest cost involved in bringing the matter to the attention

of the court.