WHEN WITNESS STATEMENTS ARE USELESS (AND PROBABLY HARMFUL): A FEW CASES TO ILLUSTRATE A COMMON POINT

For the third (and last) time I am returning to the judgment of HHJ Halliwell in  Currie v Thornley & Anor [2019] EWHC.  172 (Ch).  This time the judge’s observations in relation to witness statements.  Using witness statements to “argue” the case with witnesses who, in reality, know nothing is a surprisingly common feature of contemporary litigation.  Litigants spend millions of pounds each year for their lawyers to draft statements that are not only worthless, but positively harmful to their own case.

THE JUDGE’S COMMENTS ON THE WITNESS EVIDENCE

The judge commented on the fact that one of the applicant’s witnesses could not, in fact, give evidence of the matters in the witness statement.

  1. On behalf of the Applicant, I heard evidence from Mr Young and the Applicant himself. The Respondents gave evidence in response. I am satisfied that all four witnesses gave their oral evidence to the best of their recollection. Save for the evidence of Mr Moss, their evidence as a whole was generally reliable. Unfortunately, however, when Mr Moss was cross examined, it became apparent that a substantial part of his second witness statement (Paragraphs 40-71) had simply been collated from the documents. Some of these paragraphs amounted to little more than a commentary. In any event, these paragraphs were apparently incorporated in his statement without any regard for the principles outlined in JD Wetherspoon plc v Harris (Practice Note) [2013] EWHC 1088 and Mr Moss was unable to confirm their veracity or pertinence. They were thus of negligible, if any, evidential value.

A REMINDER OF THE KEY PASSAGE IN THE WETHERSPOON CASE

In that case the defendant made an application for summary judgment. The judge was critical of the statement that one of the witnesses had produced.

Mr Goldberger’s witness statement

    1. Mr Goldberger, a director of the second to fourth Defendants, has made a witness statement dated 7 February 2013 on behalf of those Defendants. He did not become a director of the second to fourth Defendants until 2003 and had no prior involvement with the matters which are the subject of these proceedings. His witness statement is 52 pages and contains 231 paragraphs. The Claimant has issued an application notice for an order that the contents of the witness statement be struck out apart from paragraphs 1 and 2 and 7 to 11.
    2. The vast majority of Mr Goldberger’s witness statement contains a recitation of facts based on the documents, commentary on those documents, argument, submissions and expressions of opinion, particularly on aspects of the commercial property market. In all those respects Mr Goldberger’s witness statement is an abuse. The abusive parts should be struck out.
    3. Mr Wolfson submitted that this is a wrong approach to the witness statement and its legitimacy. He submitted that the matter should be approached on the basis that, the second to fourth Defendants having been accused of dishonesty, they should be permitted to present their case as best they can as to why they have done nothing wrong and are not liable to the Claimant. He contended that, in the absence of anyone currently employed by the second to fourth Defendants who has direct knowledge of the events which are the subject of these proceedings, it is entirely appropriate that Mr Goldberger, a director, should give the explanation he has. Mr Wolfson submitted that, in setting out the course of events and making reference to the documents, Mr Goldberger was doing no more than that which would be done on behalf of the second to fourth Defendants in opening their case at trial.
    4. Mr Wolfson also submitted that, in interweaving into Mr Goldberger’s recitation of the facts his opinion on matters relating to the property market, Mr Goldberger was doing no more than was envisaged by Master Bowles when, at a hearing on 22 February 2013, the Master refused permission to adduce expert evidence on valuation but acknowledged that such opinion evidence could be adduced in the course of factual evidence.
    5. Mr Wolfson rejected any suggestion that the Claimant would be placed in difficulty by Mr Goldberger’s witness statement because it would be difficult for the Claimant’s counsel to decide how much of, and precisely which parts of, the witness statement should be the subject of cross-examination of Mr Goldberg.
    6. I do not accept those submissions of Mr Wolfson.
    7. CPR r.32.4 describes a witness statement as :
“a written statement signed by a person which contains the evidence which that person would be allowed to give orally”.
    1. Mr Goldberger would not be allowed at trial to give oral evidence which merely recites the relevant events, of which he does not have direct knowledge, by reference to documents he has read. Nor would he be permitted at trial to advance arguments and make submissions which might be expected of an advocate rather than a witness of fact. These points are made clear in paragraph 7 of Appendix 9 to the Chancery Guide (7th ed), which is as follows:
“A witness statement should simply cover those issues, but only those issues, on which the party serving the statement wishes that witness to give evidence in chief.  Thus it is not, for example, the function of a witness statement to provide a commentary on the documents in the trial bundle, nor to set out quotations from such documents, nor to engage in matters of argument.  Witness statements should not deal with other matters merely because they may arise in the course of the trial.”
  1. Nor would Mr Goldberger be permitted to give expert opinion evidence at the trial. A witness of fact may sometimes be able to give opinion evidence as part of his or her account of admissible factual evidence in order to provide a full and coherent explanation and account. That is what, it would appear, Master Bowles recognised when he refused the first Defendant’s application to adduce expert evidence on market practice. It is what the first Defendant has done in his witness statements. Mr Goldberger, however, has expressed his opinions on market practice by way of commentary on facts of which he has no direct knowledge and of which he cannot give direct evidence. In that respect he is purporting to act exactly like an expert witness giving opinion evidence. Permission for such expert evidence has, however, been expressly refused.
  2. I recognise, of course, that these rules as to witness statements and their contents are not rigid statutes. It is conceivable that in particular circumstances they may properly be relaxed in order to achieve the Overriding Objective in CPR r.1 of dealing with cases justly. I can see no good reason, however, why they should not apply to Mr Goldberger’s witness statement in the present proceedings.
  3. I indicated at the hearing that, in the circumstances, I would give a limited time to those acting for the second to fourth Defendants to consider whether, in addition to the paragraphs in Mr Goldberger’s witness statement conceded by the Claimant to be admissible, there are any other parts of his witness statement which can and should be retained consistently with the principles I have mentioned. If the parties cannot agree, any dispute over such further paragraphs shall be determined by me.

THIS IS SOMETHING WE SEE A LOT

Given the millions of pounds that litigants spend on preparing witness statements it is remarkable how often this issue arises.  Witness statements must be drafted by people with no knowledge of the rules, or who think that somehow disregarding the rules makes them particularly clever. It never works.

NORCROSS

The judgment of Mr Justice Andrew Smith in Michael Norcross -v- The Estate of Christos Georgallides deceased [2015] EWHC 2405 (Comm).

  1. Mr Dickinson’s witness statement extended beyond admissible evidence of fact. He expressed his views about usual accounting practice, and offered his opinion that in some ways AOG had behaved as “no responsible firm of accountants” would have done. No permission was sought or given for Mr Dickinson to give expert evidence, and this was not properly included in his witness statement. In any case I do not consider these views useful, and I disregard them.

    ROCK NOMINEES

In Rock Nominees v RCO Holdings [2003] EWHC 936 (CH) Smith J observed:-

“80. The only evidence offered by the Petitioner, was that of Andrew Stephen Wilson, who was described as being financial adviser to Carlisle, who also advises other entities in which Carlisle and Lord Ashcroft have an interest. He also stated that he had primary responsibility for the affairs of Kiwi and Gambier.

81. It is not being unfair to Mr Wilson to say that it is about the only clear part of his evidence. Before he actually gave evidence we had the somewhat surprising spectacle of finding something like 75% of the witness statement being struck out, as Mr Potts QC conceded in effect the material there, consisting largely of assertions, expressions of opinion and usurpation of my role, should never have been there in the first place.”

KAUPTHING SINGER

Kaupthing Singer & Friedlander Ltd (in administration) v. UBS AG [2014] EWHC 2450 (Comm)

In Kaupthing one of the witness statements contained much that was inadmissible and objectionable. In an attempt to prevent the trial being derailed the judge ordered that a redacted statement be filed, limited to admissible evidence.  Even that redacted statement contained much information that should not have been there.  Needless to say this did not do much for the judge’s view as to the credibility of the witness.

  1. Mr Brazzill’s statement was not satisfactory, not least because it contained a great deal of argument and contentious comment on documents (a common problem with statements, despite the important guidance in 32.4.5 of the White Book). It was not only unnecessarily long, but it presented UBS with an unfair dilemma about what should be challenged in cross-examination. I was not willing for him to give evidence in chief by way of confirming the original statement. Accordingly, those acting for KSF prepared an amended version of the statement, which removed a good part of the more offensive contents, and I allowed it to stand as Mr Brazzill’s evidence in chief so as not to disrupt the trial further.

  2. I did not consider Mr Brazzill a satisfactory witness: it became clear that he really knew nothing about some matters still described in his statement after it was supposedly revised to omit what was simply his comment.”

FINALLY – REMEMBER THIS: YOU MAY SURVIVE AN INTERLOCUTORY APPLICATION TO HAVE THE WITNESS EVIDENCE STRUCK OUT BUT IT CAN STILL BE STRUCK OUT AT TRIAL

This is precisely what happened in Hellard & Anor v Graiseley Investments Ltd & Ors [2018] EWHC 2664 (Ch)  The applicant’s witness statement of commentary and comment was excluded. The applicant had no evidence, the application was dismissed.

The judge considered, as a preliminary issue, whether one of the applicant’s witness evidence should be allowed to be adduced.   She held that it was of no practical use and should be excluded.

4. This application has proceeded by way of pleadings. By his initial witness statement in support of the application, Mr Hellard invited the court to direct that the draft points of claim exhibited to his statement should stand as points of claim and to set out a timetable of directions for pleadings thereafter. In introducing the draft points of claim, he very properly stated (at paragraph 13 of his statement) “It would not be appropriate for me to comment on these claims”. That is correct He was not a witness of fact and could not give any factual evidence on any pleaded issue.
  1. Following close of pleadings, directions for trial were given by order dated 29 September 2016. This order provided, inter alia, for parties to file and exchange signed statements of witnesses of fact. Thereafter, Ms Wade made and filed her statement of 12 January 2018. In reality, however, Ms Wade does not and cannot give any direct factual evidence on the issues pleaded. Those issues relate to events which occurred in 2009 and 2010. Ms Wade was not appointed as a liquidator until 2015 and does not appear to have had any real involvement in this matter until 2017 (seven or eight years after the events in issue).
  2. Ms Wade’s statement provides no evidence of any specific investigative work which she herself has carried out. The only attempt at describing her involvement is at paragraph 4, in which she refers, in general terms, to “enquiries made by my staff under my direct supervision, material supplied to me by various third parties, documents located on files obtained by my solicitors…, enquiries made by my solicitors pursuant to my instruction and … documentation disclosed by the Respondents in the course of these proceedings.”
  3. Paragraph 19.3 of the Chancery Guide provides that a witness statement should be confined to facts of which the witness can give evidence. It continues: “it is not, for example, the function of a witness statement to provide a commentary on the documents in the trial bundle, nor to set out quotations from such documents, nor to engage in matters of argument, expressions of opinion or submissions about the issues, nor to make observations about the evidence of other witnesses.”
  4. Paragraph 19.4 of the Chancery Guide goes on to confirm the long-standing principle that witness statements must indicate ‘which of the statements made are made from the witness’s own knowledge and which are made on information and belief giving the source of the information or basis for the belief. As a general rule, the witness should ‘identify by name’ any such source: Consolidated Contractors International Co SAL v Masri [2011] EWCA Civ 21.
  5. Ms Wade’s statement of 12 January 2018 breaches each of these guidelines. It sets out at length Ms Wade’s own interpretation of documents.Such interpretation is a matter of opinion only and is of no real probative value. It also contains factual assertions for which no source of knowledge is provided. This is unhelpful.
  6. I would add that, at times, the prose reads as if the statement was a pleading. The statement also contains allegations which, on their face, differ from, and go significantly beyond, those set out in the Points of Claim.
  7. Having considered Ms Wade’s statement of 12 January 2018 de bene esse with some care, I have concluded that clothing it with the status of evidence for the purposes of this trial would put the Respondents in an impossible position. They are entitled to know the case they are, to meet. They are entitled to proceed on the footing that the case they must meet is as pleaded.
  8. Cross examination of Ms Wade would simply take up valuable time at trial which could be put to better use. It would be of no practical utility beyond establishing that Ms Wade’s statement is of no probative value to the trial judge – and yet to decline to cross examine would put the Respondents at risk of an objection in closing that a given point was not put to the witness. Counsel for the Applicants sought to reassure the Court that they would not take points on whether given issues had or had not been put to Ms Wade. This, however, only served to emphasize the fact that, beyond introducing documents, the statement had no real probative value.
  9. I would add that, even allowing for such assurances and assuming that the same would be workable in practice, there would remain the difficulty of how to approach those aspects of the witness statement which appeared to allege a broader (or different) case than that pleaded, or which put forward factual assertions without identifying the source of information for the same.
  10. The Applicants argued that there is a custom or practice of permitting an officeholder to put in a statement or report for the assistance of the court. I am aware of that custom; in cases where an officeholder’s application proceeds by way of application notice and supporting statements, for example, the filing of one or more statements by the officeholder is to be expected. Similarly, in the context of some applications, it may be appropriate for an officeholder to file an ‘updating’ statement shortly before trial. But in a case such as this, where pleadings and full disclosure have been directed, officeholders should refrain from filing witness statements which do little more than set out their own views on given documents. Still less should they by their witness statement put forward a case at variance with that pleaded.
  11. The Applicants were at pains to remind me that the Respondents applied to Deputy ICC Judge Prentis some months before trial to have Ms Wade’s statement excluded from evidence ahead of trial and that their application was rejected. Naturally, I have the greatest of respect for the decision reached by the learned deputy as to whether he should, prior to trial, rule out reliance on the witness statement in question. His decision as to whether to exclude the witness statement prior to trial, however, does not bind the trial judge, who may consider the matter afresh. Having done so, for the reasons which I have given, I have decided that Ms Wade’s statement should be excluded from evidence.