TRYING TO SERVE A SUPPLEMENTAL EXPERT’S REPORT: WHEN DO THE DENTON PRINCIPLES APPLY?
In Global Horizons Corporation -v- Gray  EWHC 1132 (Ch) Mr Justice Arnold considered the question of when the Denton principles apply to service of a “supplementary” medical report.
“… the question of whether an application for permission to adduce a supplemental report after the deadline for the exchange of expert evidence is an application for an extension of time to which the relief from sanctions approach should be applied depends upon the circumstances of the application. If, for example, it is to adduce new matters arising since the date of the first report, it seems to me that the relief from sanctions analysis is not applicable. In the present case, however, it seems to me to be clear that the relief from sanctions analysis is applicable, or at any rate should be regarded as being highly material”
After a trial on liability the trial judge had given both parties to rely on expert valuation evidence. After several extensions the claimant served a report in November 2018. In December 2018 the claimant served a supplemental report. The court refused the claimant permission to rely on that report, the claimant’s application for permission to appeal was subsequently refused. In April 2019 the claimant served another supplemental report and sought permission to rely on that report. The defendant objected.
APPLICATION OF THE DENTON CRITERIA
The judge refused the claimant’s application on the grounds that the expert was going beyond the bounds of what was allowed following the liability judgment and subsequent orders.
31. In case I am wrong in that, I turn to consider the second ground. As counsel for Mr Gray pointed out in his skeleton argument, in R (on the application of Hysaj) v Secretary of State for the Home Department  1WLR 2472, the Court of Appeal confirmed that an application for a retrospective extension of time must be approached in the same way and with the same rigour as an application for relief from sanctions under CPR 3.9. As is well known, the correct approach to such an application is to apply the three-stage test set out by the Court of Appeal in Denton v TH White Ltd  1 WLR 3926. In Ellison v University College Hospitals of Morecambe Bay  EWHC 477 (QB), it was recognised that the case law is contradictory as to whether an application for permission to adduce a supplemental expert report after the deadline for exchange of expert evidence is strictly an application for an extension of time. However, the courts have consistently applied the relief from sanctions analysis either as being directly applicable or as being highly material considerations for the exercise of the court’s discretion.
32. In my view, the question of whether an application for permission to adduce a supplemental report after the deadline for the exchange of expert evidence is an application for an extension of time to which the relief from sanctions approach should be applied depends upon the circumstances of the application. If, for example, it is to adduce new matters arising since the date of the first report, it seems to me that the relief from sanctions analysis is not applicable. In the present case, however, it seems to me to be clear that the relief from sanctions analysis is applicable, or at any rate should be regarded as being highly material.
33. The reason for that is that, as can be seen from the chronology I have related, GEHC had the documents which are the foundation for Dr Becker’s supplemental report in mid-2017. Thus, there is no dispute that GEHC had the necessary materials to provide Dr Becker with the instructions to carry out a valuation upon the assumption which he has now been instructed to make at that time. Accordingly, Dr Becker could have carried out the valuation exercise that he has carried out in his supplemental report in his original further report served on 16 November 2018. All that has happened since then is that GEHC has decided to instruct Dr Becker to carry out the exercise on 5 April 2019. In those circumstances, the expert evidence which is now sought to be adduced is expert evidence which both could and should have been included in the original report on 16 November 2018.
34. Applying the three-stage test set out in the Court of Appeal in Denton v White, the first question is whether the breach is a serious or significant one. In my view, it is plainly a serious and significant one. As can be seen from the chronology that I set out, I set a deadline for the service of further expert evidence in my order of 23 March 2018, the deadline for the service of Dr Becker’s report was extended twice at GEHC’s request, and on the second occasion on “unless” terms. It was in those circumstances that Dr Becker’s main further report was served on 16 November 2018. As I have explained, there is no reason why the present valuation exercise could not have been included at that stage, and it should have been. To delay instructing Dr Becker to carry out that exercise until 5 April 2019 in circumstances where the Valuation Hearing had been long fixed in a window commencing on 30 April 2019 is plainly a serious and significant breach, in my view.
35. Secondly, I turn to consider the explanation for the breach. As to that, there is simply none. All one gets from the 13th witness statement of Brian de Clare served in support of the present application is that, having reached a conclusion as to the width of the definition of OpCo, GEHC decided to instruct Dr Becker to carry out the exercise on 5 April 2019. No explanation whatsoever is provided as to why that was not done in time for Dr Becker’s original report of 16 November 2018. No attempt whatsoever is made to excuse the lateness of the decision to instruct Dr Becker to do that exercise.
36. Thirdly, I turn to consider the circumstances of the case more generally. The starting point is the conclusions which I have already reached, namely that the breach in not including the evidence in the original report of 16 November 2018 is a significant and serious one, and that there is no explanation or excuse for it. In addition to that, there is the prejudice which would be caused to Mr Gray if the supplemental report were to be admitted. As I have explained, the application was effectively served on 18 April 2019, that is to say, on the first day of the Easter vacation. There was therefore no possibility of the application being heard until at the earliest the first day of this term, namely 30 April, being the first day of the trial window. In practice, it was not possible for me to hear the application either on 30 April or 1 May because I had pre-arranged post-judgment hearings from previous cases fixed for those two dates. Accordingly, the first possible date upon which the application could possibly be heard was today, 2 May. Were it not for this application, it might have been possible to start the trial today. As it is, I have directed that the trial will start tomorrow, 3 May. Be that as it may, what can be seen is that in reality this application was made right on the eve of trial, having regard to the intervening Easter vacation.
The judge went on to find that it was not practicable to expect the defendant’s expert to respond within the limited time scale. The claimant’s application was dismissed.