“LITIGATION WISHFUL THINKING”: A REPEAT, BUT AN IMPORTANT ONE

In assessing a case, and the evidence of both sides, litigators have to be aware of the process of  “litigation wishful thinking”.  Witnesses may be perfectly honest, but their memories as to what happened are influenced by what they wish would have happened rather than what actually occurred. A witness may well be an “honest” witness, but their evidence will not be accepted as accurate. Whilst some witnesses are dishonest, many fall foul to the problem of “wishful thinking”.  It is a concept, or process, that needs to be understood by all litigators. This blog has looked at the concept several times in the past. However given the universality of “LWT” it is worthwhile looking at four  cases where this was made explicit, together with the relevant parts of the guidance given in Gestmin.

THE OLD PARK CASE

This concept was explored by Mr Justice Richards in Old Park Capital Maestro Fund Ltd v Old Park Capital Ltd & Ors [2023] EWHC 1886 (Ch). The judge was considering an action by a corporate investment fund.  One of the defendants “HVK” was facing assertions of breach of contractual and other duties. HVK gave evidence.

THE JUDGE’S ASSESSMENT OF THE EVIDENCE

Here we look at two witnesses. “TP”, who had a witness statement largely drafted by one of the parties. “HVK” who, the judge found, was not dishonest but was involved in a large degree of “litigation wishful thinking”.

    1. TP’s witness statement was largely drafted by BP. Accordingly, TP’s witness statement was not written in his own words. I have approached TP’s evidence with a degree of caution as I was concerned that, in places, it involved an uncritical advancing of BP’s case. That concern was, to an extent, allayed in TP’s oral evidence which involved him giving largely straightforward answers to questions put to him. However, ultimately I have been unable to accept TP’s evidence on certain issues, including the question of whether he arranged for Kingsway to pay expenses of the KP (Hull) project, described in more detail below, after the Fund launched.
    1. During HVK’s cross-examination, it became clear that various assertions in his witness statement were not true. The Fund helpfully set these matters out in a Table of Admissions (that also extended to admissions said to have been made by TP). I will not deal with each instance alleged. The headline point is that HVK was wrong to deny, in his witness statement, the existence of an arrangement or understanding, made prior to launch of the Fund, for the Fund to invest in KAM CP. He was also wrong to deny his knowledge of that arrangement which was laid bare in contemporaneous emails put to him in cross-examination. The Fund has invited me to conclude that HVK was an untruthful and unreliable witness. I have considered the matter carefully but, having regard to the totality of his evidence, I will not make that finding.
    1. It was clearly not to HVK’s credit that he made untrue statements in his witness statement. Moreover, he did initially defend those statements in cross-examination. However, once he was shown emails that showed the inaccuracy of his witness statement, he accepted the inaccuracies. That necessarily meant that there was some inconsistency in his evidence, but I consider that the Fund overstates matters when it says that most of the nine indicators of unsatisfactory witness evidence that Lewison J identified in Painter v Hutchison [2007] EWHC 758 (Ch) were present. HVK has given full disclosure of a large number of documents. While his answers to some questions in cross-examination were long, I did not consider him to be evasive or argumentative. When his answers were long, that was often because of the difficulty that he had in being invited to draw conclusions from a small cross-section of the emails that he had received at the time. If anything, he was on occasions too ready to accept propositions that were put to him.
  1. Ultimately, I have concluded that the untrue statements in HVK’s witness statement were a result of what Mann J described as “litigation wishful thinking” in Tamlura NV v CMS Cameron McKenna [2009] EWHC 538 (Ch). The Fund’s case that OPC entered into a pre-existing arrangement to invest in KAM CP did not chime with HVK’s recollection of the position at the time, or what he hoped the position was, and so he asserted that the Fund’s position was wrong. That was unwise, but not dishonest. Some allowance is appropriate for the sheer quantity of emails that HVK received. Nearly 400,000 documents were extracted from HVK’s data sources, reduced to 20,000 for the purposes of disclosure. The pre-existing arrangement for the Fund to invest in KAM CP featured in just a few of the emails that HVK received. He could well have overlooked those emails, or their significance, when preparing his witness statement.

OTHER EXAMPLES

AN EXAMPLE IN A PERSONAL INJURY CONTEXT

We can see a “subconscious” rewriting of the narrative in Welsh v Walsall Healthcare NHS Trust [2018] EWHC 1917 (QB). The claimant had been out of the labour market for some time.  Her evidence was that she planned to return to work after the operation. The judge stated:-

I have concluded that this was probably unlikely. I am not persuaded that the claimant was then likely to switch her focus fairly quickly on a return to employment. By then, she would have been away from the employment market for many years. She plainly enjoyed doing things for her family, she told me that she loved cleaning and feeling useful in that way. To some extent, I believe the claimant has subconsciously rewritten the narrative as far as her employment history is concerned. Her claim to have been out of employment because she was doing equivalent work as a carer did not stand up when the chronology was scrutinised.

 

KHAMBAR -V- NIJHAR

The concept of litigation wishful thinking was referred to, explicitly, by Mr Simon Picket QC (sitting as a High Court judge) in Khambay -v- Nijhar [2015] EWHC 190 (QB)

  1. Dr Khambay’s abilities were evident to me when he gave evidence; he is undoubtedly an able man. Unfortunately, however, it was also apparent to me that he was astute to the need to ensure that the evidence which he gave did not harm the case which he and Clubhire were advancing against Mr Nijhar. I am also clear that, whilst he was not setting out to mislead in the evidence which he gave, nonetheless he did engage in what has been termed in the past as ‘litigation wishful thinking‘ (see Tamlura NV v. CMS Cameron McKenna [2009] EWHC 538[2009] Lloyd’s Rep PN 71 per Mann J at [174]). Dr Khambay, in other words, has convinced himself, especially given the passage of time which there has been since the relevant events, that his recollection is in all respects the truth, when that is not the case. He was also grudging in quite a few of his answers to perfectly reasonable questions. This was accentuated by his seeming unwillingness to speak up when giving his evidence, despite several requests that he do so because of the difficulty I sometimes had in hearing what he was saying. In these circumstances, I approach Dr Khambay’s evidence with some degree of care and ideally looking for independent support for what he had to say, whether from other witnesses or in the contemporaneous documents. However, I do not consider it appropriate to adopt the course suggested by Mr Mason, which was to place no trust in the evidence given by Dr Khambay. On the contrary, I felt that, in broad terms at least, Dr Khambay was striving to give evidence which was truthful and reliable. Nonetheless, it does not follow that I should uncritically accept everything he told me since I am conscious that, like the other witnesses, he was relating events which took place a long time ago (mainly about 8 years ago). I also am alive, as I say, to the likelihood that, in giving his evidence, Dr Khambay was at pains to ensure that he said nothing which might damage his (and Clubhire’s) case.”

AMLURA N.V. -v- CMS CAMERON McKENNA

This concept was also  set out explicitly by Mr Justice Mann in Tamlura N.V. -b- CMS Cameron McKenna[2009] EWHC 538 (Ch)

“I am sure he is a basically truthful man, but I think that some of his evidence was affected by concern at the commercial outcome of this deal, and his reconstruction has led him into evidence tinged with wishful thinking”
“Vlotman seemed to think that he had a real case and I have not found that either he or Mr Christie have acted dishonestly in bringing it. I think that this is a case in which Mr Vlotman and Mr Kresfelder, and probably Mr Christie, made and accepted the deal that they did without themselves foreseeing the full scale of what might happen to the consideration. They made the deal with their eyes open in relation to the main aspects of the deal, without perhaps fully thinking everything through, but at the same time being satisfied with a bargain which gave them potentially a lot of money. They probably thought that TIG shares would continue to rise, and if they had done so then a completion date valuation would give them a good deal. When things turned sour, their first reaction was not to accuse CMS of letting them down, because CMS had not done so. CMS had implemented their bargain, as they were instructed to do. However, as is not unfamiliar in litigation, regret over what happened has led to a search for those who might be blamed, and has tinted the spectacles through which the events are now viewed. It is a form of “litigation wishful thinking”. So they have forgotten that they were content with the original deal, and meetings at which they discussed things with Mr Aspery have turned into false recollections of advice that was not given. This does not amount to a deliberately fabricated case, but it does not create a good one either.”

THE RELEVANT PARTS OF THE GUIDANCE IN GESTMIN

The guidance in Gestmin has been considered many times on this blog.

THE FAULTY MODEL OF MEMORY AS A MENTAL RECORD

Underlying both these errors is a faulty model of memory as a mental record which is fixed at the time of the event and fades over time.

  • Memories are fluid and malleable.
  • They are constantly rewritten whenever they are retrieved.
  • This is true of “flashbulb” memories of a shocking or traumatic event.
  • The very description “flashbulb” memories is misleading because it reflects the misconception that memory is like a camera.
  • External information can intrude into a witness’s memory as can their own thoughts and beliefs.
  • This can cause dramatic changes in recollection.
  • Events can be recalled as memories which did not happen at all or which happened to someone else (“a failure of a source of memory”.)

MEMORY IS ESPECIALLY UNRELIABLE WHEN IT COMES TO RECALLING PAST BELIEFS

Memory is unreliable when it comes to past beliefs.

  • Memories are revised to make them more consistent with our present beliefs.
  • Studies show that memory is particularly vulnerable to inference and alteration when a person is presented with new information or suggestions when their memory is already weak due to passage of time.

THE PROCESS OF CIVIL LITIGATION ITSELF SUBJECTS MEMORY TO BIASES

The process of civil litigation itself subjects the memories of witnesses to powerful biases.

  • Witnesses have a stake in a particular version of events.
  • This is more obvious in relation to parties and those with ties of loyalty to parties.
  • More subtle influences include the very process of making a witness statement and going to court to give evidence.
  • A desire to assist the party calling a witness and a natural desire to make a good impression can be significant motivating factors.

THE PROCEDURE OF PREPARING FOR TRIAL HAS A CONSIDERABLE INTERFERENCE WITH MEMORY

Considerable interference with memory is introduced by the process of preparing for trial.

  • A witness is often asked to make a statement a long time after the relevant events.
  • The statement is usually drafted by a lawyer who is lawyer who is conscious of the significance of the issues in the case.
  • The statement is made after a witness’s memory has been “refreshed” by reading documents.
  • The documents include pleadings and other argumentative material which the witness did not see at the time or which came into existence after the event.
  • The statement goes through several versions before it is finalised.
  • Months later the witness is asked to re-read the statement and documents before giving evidence in court.
  • The effect of this is to establish in the mind of the witness the matters in the statement and documents whether they be true or false.
  • This also causes the witness’s memory to be based increasingly on the material and later interpretations rather than the original events.