Costs -v- fairness
An example of natural justice and fairness to the parties triumphing over increasingly cost-conscious procedural dogma
The whole question of costs and proportionality is now enshrined in the overriding objectives of the Civil Procedure Rules (CPR). Yet cost is not the only determining factor, and the courts have acknowledged that sometimes the broader interests of justice will require the appointment of additional experts. In such circumstances there may be some overlap between the issues covered and a resulting increase in time and expense.
Combinations and permutations
Such was the finding of the court in Various1. These were complex professional liability proceedings involving 142 claimants against their former solicitors. The matter was unusual in that 91 of the claimants (group A) had commenced proceedings by instructing one firm of solicitors and the remaining 51 (group B) had instructed another firm.
The defendant was an Italian law firm that practised in England. Although the governing law was that of England and Wales, some of the documents involved (known as ‘Mandates’) were governed by Italian law and required expert evidence in relation to their meaning and effect. The existence of these Mandates had become known to the group A claimants during the course of their proceedings. At a case management hearing they had sought leave to amend their particulars of claim to reflect alleged breaches of fiduciary duties arising under the terms of these Mandates. The Master had upheld objections by the defendant that this was a matter for Italian law and he refused leave to amend. So the group A claimants instead sought detailed preliminary expert opinion on the meaning and effect of the Mandates in Italian law.
At some later point the Court ordered that there be consolidation of the two sets of proceedings and that all 142 claims be heard together. At the first consolidated case management hearing the defendant applied to set aside default judgments that had been obtained by group B; for the purposes of that application, the group B claimants and the defendant had served expert evidence on each other that included expert evidence by an Italian lawyer, Notary Valente.
The case management orders made by the judge included that:
- all the actions were to be the subject of common case management and to be transferred to the Queen’s Bench Division for further case management, and
- there should be a trial of generic issues that were to be agreed between the parties.
At a subsequent case management conference, directions were given as to the expert evidence to be called. Group A was restricted to calling expert evidence only on those matters that had not already been covered in Notary Valente’s report, despite the fact that the group A claimants had had no input into the instruction of Notary Valente.
At the Court of Appeal
Understandably, the group A claimants appealed against the order. They felt that the effect of the order was to require them to accept the group B expert report without the opportunity for their expert to comment on it or to cover the same issues. However, the group B expert was allowed to address issues arising out of group A’s limited expert report, and the defendant’s expert was permitted to respond to any evidence from either of the claimants’s experts. The group A claimants further submitted that it would be unfair to prevent their expert from preparing a report on all the generic issues in the case.
Allowing the appeal, the Court of Appeal was in no doubt that this was one of those relatively rare cases when it was right for the Court to interfere with the case management decision of a lower court. It was observed that, ultimately, the Court has to do procedural justice. Giving his judgment, the Master of the Rolls said that the points made on behalf of the group A claimants were unanswerable. If this had been managed litigation from the outset then almost certainly the judge managing the case would have said that all the claimants were entitled to have only one expert dealing with Italian law. A compelling reason has to be given for granting permission to parties to rely upon more than one expert in relation to the same issue. There may be particularly complicated cases where such an exceptional course is justified, but nobody has suggested that the Italian law issues in this case fell into that exceptional category.
He went on to observe, however, that the unusual feature of this case was that it was not managed litigation from day 1. It was only when the two sets of proceedings came together that the combined litigation became managed. In such unusual circumstances it would be wholly wrong in principle for the group A claimants to be ‘saddled’ with the group B claimants’s expert for the reasons they had given. The conclusion was reinforced by the fact that the group A expert did not agree with all of the group B expert’s points. Consequently it was fundamentally unfair to the group A claimants to say to them that they were not permitted to instruct their own expert.
Although the Court of Appeal observed in closing that it was ‘unfortunate’ that its decision in this case would probably result in two experts giving evidence on Italian law on behalf of the two groups of claimants, there appears to have been very little reluctance shown when reaching the decision – all three appeal judges concurred. This is surely a reassuring example of natural justice and fairness to the parties triumphing over increasingly cost-conscious procedural dogma. May there be more of the same in the future!
1 Various -v- Various Defendants related to Giambrone  EWCA Civ 1562.