EXPERTS NOT FOLLOWING THE RULES: DEPLETES YOUR ENERGY: A HIGH COURT CASE

The “Covid Repeats” section of this blog next week will review cases relating to experts.  Problems with experts remain a key issue in litigation.  Primarily caused by the expert’s failure to follow the basic rules and court orders. Examples can be seen in the judgment of Joanna Smith QC, sitting as a Deputy High Court Judge, in DBE Energy Ltd v Biogas Products Ltd [2020] EWHC 1232 (TCC)

THE CASE

The claimant brought an action in breach of contract and negligence relating to components supplied by the defendant.  Both sides called expert evidence as to liability and to damages.

THE JUDGE’S COMMENTS ON THE EVIDENCE

Neither side escaped criticism.

The Technical Evidence
    1. Both parties relied on technical evidence as to the design, manufacture and commissioning of the Tank Heaters and Pasteuriser Tanks. The specific field of expertise for which the court gave permission at the CMC was the field of “design, fabrication and installation of pressure equipment“. The technical experts each prepared a detailed expert report together with a Joint Statement (“the Technical Joint Statement“).
    2. DBE relied upon the technical expert evidence of Mr Peter Lumley, an experienced Chartered Mechanical Engineer whose specialist field is mechanical design and engineering in process equipment and storage tanks. It is clear from his CV that he has substantial technical and practical expertise in process design and in the design, construction and commissioning of pressure vessels, plants and pipelines in complex projects within the oil and gas, petroleum refining, petrochemical and pharmaceutical industries. Mr Lumley’s obvious expertise was not challenged by Biogas. Mr Lumley had visited the site of the AD Facility and had examined the four failed Tank Heaters and the two failed Pasteuriser Tanks.
    3. Biogas relied upon the technical expert evidence of Mr Stephen Marshall, a chartered engineer and Member of the Chartered Institution of Building Services (MCIBS) who has been a director of various Building Services design consultancies specialising in the design of multi-occupancy buildings for many years. His CV records that he has acted as an expert in disputes concerning mechanical installation for 20 years. Mr Marshall had not carried out an inspection of the failed Pasteuriser Tanks and Tank Heaters.
    4. Under cross examination, Mr Marshall accepted that he did not have a mechanical engineering degree, that he was not an expert in the installation and commissioning of works in an AD plant or similar gasification plant and that he had not previously been involved in the design of equipment for gasification plants or similar anaerobic digestion facilities. In the circumstances, DBE contends that his qualifications and experience do not fall within the field of expertise identified by the court. Furthermore, DBE contends that Mr Marshall’s evidence was partial and biased in favour of Biogas, first because he sought to introduce inadmissible material into his expert report (which material was subsequently removed by Order of the court at the PTR) and into the Technical Joint Statement (which material was subsequently removed by agreement between the parties on the second day of trial), second because various parts of his report exhibited a tendency to advocate in favour of Biogas’ case, including by simply adopting Biogas’ factual case without acknowledging the existence of an alternative factual position on the part of DBE and third because he was, on occasions, inclined in his report to make factual findings which were matters for determination by the court.
    5. Whilst I have no doubt that Mr Marshall’s relevant experience is clearly not as extensive as Mr Lumley’s experience (as Mr Marshall himself acknowledged in the Technical Joint Statement), I do not accept that he has no relevant expertise in relation to pressure vessels or commissioning. As he explained in the Technical Joint Statement, it is part of his day to day engineering activity to design pressurised hot water circulating systems involving pressure equipment such as pumps, pipes and vessels having similar operational parameters to those found in the hot water system at the Site. In the circumstances, I reject the suggestion that Mr Marshall’s opinions have no value.
    6. I have more sympathy with the complaint that Mr Marshall has not been impartial in giving his evidence. In this regard my attention was drawn to Fraser J’s recent observations in Imperial Chemical Industries Ltd v Merit Merrell Technology Ltd (No. 2) [2018] EWHC 1577 (TCC) at [236] to [237], and in particular 237(2) to the effect that “it is not the place of an independent expert to identify which version of the facts they prefer. That is a matter for the court“. In my judgment, Mr Marshall did not take proper care in his report to set out the background facts in an impartial way and this resulted in the expression of views which appeared to me, on a number of occasions, to be biased in favour of Biogas. Furthermore, despite the clear identification by the court at the CMC of the issues that the technical experts were to address, Mr Marshall chose to try to introduce into his report (and later into the Technical Joint Statement) numerous other issues which did not arise from the pleadings. He also sought to assert as facts matters which were properly for the determination of the court.
    7. In all the circumstances, I am bound to say that where there is disagreement between the technical experts, I prefer the opinions of Mr Lumley.
The Quantum Evidence
  1. Both parties relied on the evidence of experts in the field of accountancy. DBE relied upon the report of Ms Kate Hart, a Chartered Accountant and partner in the forensic services department at Roffe Swayne. Biogas relied on the report of Mr Phillip Southall, a forensic consulting director with FAR Consulting.
  2. In many respects there was not a great deal between the quantum experts, whose Joint Statement (“the Quantum Joint Statement“) reflected a considerable amount of agreement, and I shall return later to the areas where they disagreed. In closing, Mr Cheung, on behalf of DBE, submitted that Mr Southall fell into similar traps to those encountered by Mr Marshall, that he opined on unpleaded issues, failed to have regard to documents supporting DBE’s quantum case and was reluctant to make appropriate concessions. I do not agree. I found Mr Southall to be a clear and straightforward witness and I do not accept that, as a matter of generality, I must treat his opinions with caution, as suggested by Mr Cheung.
  3. For present purposes I make one observation about Ms Hart’s evidence. Notwithstanding that it has been made abundantly clear in this court that, in forming his or her opinions, an expert ought not to rely on material that is not available to the other side’s expert (see Imperial Chemical Industries Ltd v Merit Merrell Technology Ltd (No. 2) [2018] EWHC 1577 (TCC) at [237(1)]), Ms Hart made reference on a number of occasions in her report and in her oral evidence to information she had received from DBE that was not in witness statements or documents before the court. She did not appear to appreciate that there was any issue with this approach and it can only be inferred that DBE’s legal team did not alert her to the fact that she could not properly rely on such evidence in arriving at her expert opinions. In circumstances where Mr Southall has not had access to that information and it is not in evidence, I have concluded that I must disregard those parts of Ms Hart’s evidence which rely on such material.