WITNESS STATEMENTS “NOT IN MY STOCK IN TRADE”: HIGH COURT JUDGE HIGHLY CRITICAL OF ARGUMENTATIVE AND LARGELY IRRELEVANT WITNESS STATEMENTS

June 30, 2020 · by · in Applications, Civil evidence, Summary judgment, Witness statements

Last week I wrote about the report on witness evidence working group of the business and property courts.   That report commented that drafting witness statements (more accurately evidence in chief) was no longer part of a lawyer’s “stock in trade”.  Ignorance of, or a decision to ignore, the basic rules relating to witness statements can be seen a plenty in the judgment of Mr Justice Andrew Baker in Skatteforvaltningen (The Danish Customs And Tax Administration) v Solo Capital Partners LLP & Ors [2020] EWHC 1624 (Comm). Both the tendency to use witness statements to “argue” the case and not to give the source of information and belief led to witness statements that were over-long and irrelevant.   The costs involved must have been enormous.

 

“My criticism concerns, rather, the content and length of the statements. They were, to a substantial extent, not witness evidence, but argument. The parties have therefore expended the time and effort, at no doubt very considerable cost, to argue the summary judgment application twice over, once in writing through the solicitors’ witness statements, then again at the hearing.”

THE CASE

The defendant brought an application for summary judgment in a claim that the defendant owed a duty of care to the claimant tax authority.

Both parties filed extensive witness evidence.

THE JUDGE’S COMMENTS ON THE WITNESS EVIDENCE

This is as trenchant a criticism of witness statements as I have seen, both in terms of the argumentative nature of the statements and the failure to give the source of information and belief.

The Witness Evidence
    1. The factual witness statements on the summary judgment application were, I regret to say, substantially unsatisfactory. They were (in service sequence):
(i) A first statement of Fiona Simpson of Kingsley Napley (‘Simpson 1’), served together with a first statement of Mr Everard (‘Everard 1’) in support of the summary judgment application.
(ii) A fifteenth statement of Andrew Herring of Pinsent Masons (‘Herring 15’), served in opposition to the summary judgment application and in support of SKAT’s responsive application to amend its pleadings.
(iii) Second statements of Ms Simpson and Mr Everard (‘Simpson 2’ and ‘Everard 2’), served in reply on the summary judgment application and in opposition to the amendment application.
(iv) A first statement of Stuart McNeill (‘McNeill 1’), served in reply on the amendment application but also (effectively) by way of rejoinder on the summary judgment application.
(v) Third statements of Ms Simpson and Mr Everard (‘Simpson 3’ and ‘Everard 3’), by way of surrejoinder.
    1. My criticism concerns not the number or sequence of statements. I am not troubled, in particular, by the fact that McNeill 1 led to Simpson 3 and Everard 3 by way of a further round of evidence. My criticism concerns, rather, the content and length of the statements. They were, to a substantial extent, not witness evidence, but argument. The parties have therefore expended the time and effort, at no doubt very considerable cost, to argue the summary judgment application twice over, once in writing through the solicitors’ witness statements, then again at the hearing. It is not as if, recognising the extent of coat-trailing, the parties declined to follow the modern habit of lengthy and detailed skeleton arguments. They sought and were granted liberty for their skeleton arguments to be up to 50 pages each. Needless to say, perhaps, they did not restrain themselves from exercising that liberty to the full (although in SKAT’s case, the skeleton only just tipped over 49 pages, by a couple of lines and a final footnote). To be clear, I am not suggesting that argumentative witness statements plus short skeleton arguments cross-referring me to them would have been proper procedure, but the latter, having committed to the former, might at least have been more cost-efficient.
    2. I find it impossible to identify what purpose it was thought might be served by arguing the application out through the witness statements like that. Of course these were not trial witness statements – indeed I imagine Ms Simpson, Mr Herring and Mr McNeill are unlikely to be witnesses at a trial – and a limited element of explanation of the perceived relevance to the anticipated summary judgment argument of factual matters dealt with in the statements might not be out of place. But that is not required and should be included, if at all, with real care and an eye on minimality.
    3. To the extent that contemporaneous documents will be relied on, they are naturally and conveniently exhibited and identified through a main witness statement from the legal representatives, where parties are legally represented, or from litigants in person themselves, whether or not they would be witnesses at any trial in due course. But taking a court through the documents, making submissions as to what they show or what inferences are to be or might be drawn from them, is a matter for argument, not for witness evidence. Again, limited indications of the nature of what it will be submitted the court should find in or infer from the documents can have their place. But again, less is more should be the rule if that is to be done at all.
    4. To highlight some elements of Simpson 1 that, sadly, set the trend on this occasion, on no view should it have included:
(i) A lengthy summary (running to some 8 pages) setting out how Ms Simpson read the pleadings.
(ii) An outline detailed argument (6½ pages) why the court should say no duty of care was owed, lightly dotted with snippets of factual evidence. This was presented by way of seven propositions, all of which were self-evidently matters of argument, not fact, some using language such as “SKAT’s attempts to suggest … are, with respect, hopeless“, “Quite apart from the complete failure by SKAT to say …, such a duty cannot be established as a matter of principle“, “SKAT’s position is not improved by …“, or “… it is striking that SKAT nowhere pleads … [but] simply asserts. … The pleading is also strikingly vague …“.
(iii) A submission as to whether Goal breached any duty of care or whether, if so, loss foreseeably resulted, which admittedly ran to only 2 pages, but of which, on reflection, only three sentences covering 8 lines of text were proper content, the first of which (covering the first 4 lines of text) did no more than locate the relevance of the minimal factual points made by the second and third sentences with a cross-reference to and quotation from paragraph 88 of the Particulars of Claim.
    1. Having seen the extent to which these were not witness statements but written submissions, I required further copies to be provided with passages to be relied on as factual evidence, rather than argument, highlighted. The parties also provided me, after the hearing, with Word documents in which only the highlighted passages were retained. Those exercises demonstrate that whereas the solicitors’ witness statements as served were some 157 pages long in total (29, 50, 56, 10 and 12 pages respectively for Simpson 1, Herring 15, Simpson 2, McNeill 1 and Simpson 3), that could and should have been no more than c.80 pages (say 12, 28, 25, 6 and 9 pages respectively), even if they retained (as the Word documents I was given did) the unnecessary quotation of documents I would be taken to or asked to read.
    2. In fact, I would go further and say that it is far from clear to me that substantial factual evidence was reasonably required for this hearing at all. Mr Hough QC largely failed, with respect, to keep clearly distinct in his oral submissions whether, or where, the case for Goal is that there was no viable claim, taking at face value the material facts pleaded by SKAT (one element of which may be argument over what pleaded facts are material) and whether, or where, the case is that SKAT has no realistic prospect of establishing at a trial the material facts pleaded. Given the difficulties with SKAT’s pleading, I should say that may not be as significant a criticism of Mr Hough as it might sound. But for the most part, in my judgment, the serious argument for Goal on this application was an argument of the former kind; and even where it is clearly of the latter kind, it is for the most part just argument nonetheless, for example whether SKAT has identified any credible basis for a finding of fact the pleading says it will seek at trial by way of inference.
    3. This is not, or is not primarily, a complaint about the burden of pre-reading. Judges can recognise, and ignore or skim through, argument when they see it in a witness statement; although that does not address my wider concern that I could probably have been spared the need to read, at least for the most part, even that 50% or so of the witness statements that did contain evidence of fact. Nor in this case is it a complaint about wasting paper, as the case materials are hosted digitally by Opus 2 using their Magnum system. It is a concern that far too much time will have been spent on the pre-hearing stages of this application, on both sides, at expensive hourly rates, because of the approach adopted by Goal, and joined in enthusiastically by SKAT, to treat the exchange of evidence for the application as an opportunity to (try to) argue the application out between the legal teams, on paper, before then arguing it out, this time properly, before the court at the hearing, further exacerbated, if I am right in my wider concern, by a failure to assess whether or to what extent factual witness evidence was reasonably called for at all.
    4. There is a further significant criticism of Goal’s witness statements. As I have noted, they came from Ms Simpson, who claims no first-hand knowledge of the underlying events, and Mr Everard (only) of Goal. But Mr Everard, so far as I can see (provisionally) at this stage, does not appear to have had any very substantial day-to-day role either, as regards many of the matters that will or may be relevant. This being a summary judgment application, not a mini-trial, it is not necessarily a difficulty for Goal that I do not have separate witness statements from others at Goal who were more closely involved in the detailed facts. But I agree with Mr Goldsmith QC that it is necessary to approach with very real caution any suggestion that the facts are clear, or that the issues raised by the summary judgment application should not have the benefit of normal pre-trial procedures and a full trial, if it requires the court to take at face value evidence it is not clear Mr Everard is in a position to give from his own knowledge but for which no other source is identified.
    5. Mr Goldsmith QC referred me to a summary judgment decision in Punjab National Bank (International) Ltd v Techtrek India Ltd et al. [2020] EWHC 539 (Ch), in which Chief Master Marsh said this, at [17]-[20]:
“17. CPR rule 32.8 specifies that a witness statement must comply with the requirements set out in Practice Direction 32 and paragraph 18 of that practice direction sets out provisions specifying what must be contained in the body of a witness statement. Paragraph 18.2 requires that the witness statement contains a statement indicating which of the statements are made from the witness’s own knowledge and which are matters of information and belief. In addition, the witness statement must indicate “… the source for any matters of information or belief.” The rule does not say whether the “source” of evidence in the case of a corporate entity must be identified by referring to a person or persons, or whether, as here, it suffices to identify “officers of the Claimant”.
18. CPR rule 32.4(1) 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.” Whether the witness statement is intended for use at a trial or another hearing the form of the statement is the same and the requirements of CPR rule 32.8 and the Practice Direction must be complied with. It is important … that the maker of the witness statement makes it clear when the statement contains hearsay evidence and in doing so complies with the requirement to specify the source. As Patten J pointed out in Clarke v Marlborough Fine Art Ltd [2002] 1 WLR 1731 at [37] the failure to identify the source of hearsay evidence does not render the hearsay evidence inadmissible but it goes to the weight the court will give to that evidence.
19. As a general observation, it is a matter of considerable convenience that a legal representative is able to provide hearsay evidence for hearings, other than trials, based on instructions. One reason for this is that it is more economical for evidence to be gathered in one place, rather than the court being provided with a series of witness statements from those who can give first-hand evidence. Another factor that will be in the minds of legal advisors is that hearsay evidence provided by a solicitor prevents the person who has knowledge of the relevant events being subjected to cross-examination at the trial on the content of a witness statement made at an early stage of the claim and before disclosure has been given. The corollary, however, is that the requirements of paragraph 18 of Practice Direction 32 must be carefully complied with if the statement is to be given full weight. Where the applicant seeks summary judgment this is of particular importance.
20. In my judgment, where the maker of a statement is relying on evidence provided by a witness who is an officer of, or employed by, an incorporated body, the requirements [sic.] of paragraph 18 of Practice Direction 32 to provide the source of evidence is not complied with merely by saying that the source is the entity or officers of the entity. If the source of evidence is a person, as opposed [to] the source being documents, the person or persons must be identified and named. … A failure to identify the source in a manner that complies with paragraph 18.2 will mean the court has to consider whether to place any weight on the evidence, especially where it touches on a central issue.“
  1. I agree with almost all of that. I disagree with the apparent suggestion, if intended by the middle sentence of [19], that it might properly be in the mind of legal advisors that their giving hearsay evidence at an interlocutory stage might be a means for avoiding cross-examination of their source, if called as a witness at trial, on the account thus presented to the court at that prior stage as having been their account. I also disagree with the possible suggestion, again if intended by that same sentence, that there is necessarily a difficulty if the court becomes aware of what was a witness’s account prior to disclosure. There is generally no such difficulty. Rather, in general, it will be of benefit to a party, possibly significant benefit, if a witness’s account can be seen to have been given, or first given, a lot earlier than only around the time of an exchange of witness statements a few months before trial, even if it is fair and sensible for any final version to be signed off only at that stage (and after disclosure, in particular).
  2. CPR 32 PD18.1(5) provides that a witness statement should state the process by which it has been prepared. That is not limited to the basic point given “for example”, namely whether the statement was prepared “face-to-face, over the telephone, and/or through an interpreter”. It is not a problem, rather it is to the credit of a witness, and to the party calling the witness, if there is greater transparency at trial as to the process by which any final version of the witness’s evidence for trial was collated and created, although of course litigation privilege means it will be for the party to decide how much is to be revealed to the court. On important contentious points of fact, greater transparency is to the credit of a witness (and the party calling the witness) even if – indeed, especially if – it extends to the witness being open up front, i.e. in chief, that when first asked about them, he or she perceived as recollection a certain version of events, but having been reminded of some document or documents they saw at the time or been assisted in some other legitimate way, he or she now has a different recollection, or an additional recollection, or both. The law on refreshing a witness’s memory during oral evidence in chief is stated succinctly in Phipson on Evidence, 19th Ed., at 12-09 (and for a fuller exposition of the common law rules, see the 15th Ed., at 11-45ff (not 12-54ff as suggested in the 19th Ed. at 12-54)); that law is, for good reason as I would understand it, quite narrow. I do not say a witness cannot properly be asked to consider, for the purpose of a trial witness statement, material he or she could not use to refresh recollection during an oral examination in chief. But care needs to be taken, where that is to be done or has been done, if it is not to devalue the resulting testimony. If the recollection presented in a trial witness statement is neither unaided nor the result of memory being refreshed in that way, that may not mean, without more, that the testimony is rejected by the court; but to be able properly to assess the weight to give it, it is better if the court is told where it has come from.
  3. The assessment of the weight to be given to a factual witness’s trial testimony is supposed to be a matter for the court. Giving the court by a trial witness statement, as happens all too often, a polished and heavily lawyered version of events, the process behind which has far removed it from any account the witness could have given in examination in chief, assists neither the court nor the witness. It serves to increase the cost of the witness statement phase, to lengthen and increase the hostility of cross-examination and increase the witness’s vulnerability to that lengthened cross-examination, and thus ultimately to harm, not to improve, the case of the party calling the witness.
  4. Aside, then, from that middle sentence of [19], I agree with Chief Master Marsh’s views, supra. Contrary to paragraph 18 of CPR PD32, as there explained, Goal’s witness statements for its summary judgment application largely failed to identify the source or sources of the information being presented (where those were not just the documents exhibited). Each of Mr Everard’s brief statements included some limited factual content plus a verification in general terms of the facts set out in Ms Simpson’s corresponding statement. It is not clear, however, whether Mr Everard was in any real sense Ms Simpson’s source of information. In each of her statements, she noted that Mr Everard’s statement “attests … to the facts in this statement of mine which I provide on instructions from Goal” (my emphasis). (That quotes Simpson 1. The wording used in Simpson 2 and Simpson 3 was different, but to the same effect: “Where I comment on Goal’s business practices, its dealings with others … and its state of knowledge, my evidence is based on instructions from Goal. A second [respectively, third] statement is being served from Stephen Everard, CEO of Goal, which endorses and attests to the factual content of my statement.“)
  5. That indicates to me that Ms Simpson’s source of information was one or more unnamed individuals, not Mr Everard, but that Mr Everard was asked to look over, and in the event felt able to confirm the accuracy of, the resulting statement of the facts, to the extent Ms Simpson did state facts rather than argue the case. Mr Everard for his part does not identify how much of what Ms Simpson sets out he claims to recall from first-hand knowledge at the time and to what extent he is purporting to verify Ms Simpson’s ‘facts’ upon the information of the unidentified others. Everard 1 says that the factual account in Simpson 1 is “based on information and documents that we at Goal have provided to our solicitors“. He repeats that formula for Simpson 2 and Simpson 3, in Everard 2 and Everard 3 respectively, in each case adding that where Ms Simpson attributes an understanding, or views, to Mr Everard himself, her evidence “is correct” and that “Where she attributes understanding or views to Goal, I believe her evidence to be correct based upon my own knowledge and information from my colleagues in the company.” Leaving aside Mr Everard’s own understanding or views, identified as such by Ms Simpson, it is nowhere explained for what Mr Everard claims to be able to rely on his own knowledge, and for what he speaks from information given to him by his unnamed colleagues, with what reason (if any) for treating their information as relevant or helpful.
  6. That is not a satisfactory basis upon which to seek the summary dismissal of otherwise fairly arguable claims, i.e. claims that have a realistic prospect of success, or for which there is other compelling reason for a trial, on the facts and arguments of law presented by SKAT without reference to Ms Simpson’s and Mr Everard’s statements (to the extent they do more than exhibit documents to inform the argument). If SKAT’s claims against Goal are not otherwise fairly arguable, in that meaning, Goal does not need those statements to persuade the court to dismiss SKAT’s claims summarily. If they are otherwise fairly arguable, however, then Goal has not put before the court evidence that I can say at this stage is worthy of being given any particular weight, let alone such weight as to knock SKAT out summarily, on matters of fact that would or might realistically be contentious at a trial. In other words (and echoing what I called my wider concern about the witness statements (paragraph 89 above)), I struggle to identify what Goal’s witness statements added to the fact that there was a Statement of Truth appended to its Defence signed by Mr Everard as CEO. Had Goal rested upon that Statement of Truth, then on contentious points of fact I would have accepted the inevitable argument by Mr Goldsmith QC that that was not good enough to dispose of SKAT’s claims summarily if they otherwise raised a case to answer. Despite their length, but because of their content, the witness statements served by Goal, with respect, do not do any better for it for the purpose of an attempted summary dismissal of SKAT’s claims.
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