Dispute Resolution analysis: This is the first judicial analysis of the new practice direction on trial witness statements (CPR PD57AC).
The applicant did not succeed in striking out parts of certain witness statements on grounds that they were opinion evidence and/or did not comply with CPR PD 57AC. The court found that CPR PD 57AC does not create a new rulebook for analysing admissibility of witness evidence.
There are particular circumstances where a witness of fact can give opinion evidence: this can be where they have relevant expertise, where the witness is giving their opinion on a hypothetical counterfactual scenario and/or in the context of quantum. The court will take a flexible approach to considering admissibility, and will consider whether the opinion evidence can assist the court in assessing documentary or expert evidence before the court.
Mad Atelier International BV v Manes [2021] EWHC 1899 (Comm)
What are the practical implications of this case?
Legal representatives are getting to grips with the new CPR PD 57AC—trial witness statements in the business and property courts. The new practice direction applies to new and existing proceedings, but only to trial witness statements signed on or after 6 April 2021. This case appears to be the first instance where the courts have given a reasoned judgment on CPR PD 57AC.
The applicant submitted that previous authorities on admissibility of witness evidence now needed to be read in the light of CPR PD 57AC. The court’s key finding was that the new CPR PD 57AC does not change or overrule the existing law/authorities on admissibility of evidence. The judge’s opinion was that the new practice direction was most obviously valuable in saving costs, by clamping down on lengthy witness statements which merely comment on the documentary disclosure.
The decision will give some reassurance to practitioners who are preparing witness evidence, or reviewing the evidence served by their opponents. This judgment makes clear that:
- a witness of fact can give opinion evidence where it is related to factual evidence which they give, especially if they have relevant expertise or know-how
- such witnesses can give opinion evidence about a hypothetical, and not in a way which is limited to what they personally would have done
- opinion evidence of this nature is often helpful to the court in assessing quantum
- such evidence, while admissible, still needs to be appropriately weighed by the court and may turn out to be unreliable
What was the background?
The court had before it an application made by the defendant at the pre-trial review of the claim ahead of a trial listed in October 2021. The defendant was seeking an order to strike out passages of various witness statements as inadmissible, pursuant to the sanctions provided in CPR PD 57AC, para 5.2(1).
The application was made in the context of a dispute between the parties concerning a joint venture to develop an international restaurant franchise. The claimant’s claim alleges that the defendant fraudulently induced it to enter into transactions which led to the joint venture agreement being terminated. The assessment of the damages claimed in the case will involve the court considering the hypothetical likely profits of the restaurants which would have been operated under the joint venture-a ‘but for’ analysis. The paragraphs in question addressed quantum and, specifically, what would have happened to the joint venture business if it had not been terminated.
The defendant alleged that the passages in question did not comply with CPR PD 57AC because:
- they did not contain only evidence as to matters of fact that needed to be proved at trial as required by CPR PD 57AC, para 3.1
- they included commentary on other evidence in the case (either documents or the evidence of other witnesses). This is not permitted by CPR PD 57AC, para 3.6
The claimant’s position was that the evidence was appropriate, as the witnesses were giving their opinion on the ‘but for’ counterfactual, by reference to their relevant experience. Further, there was no blanket rule that witnesses who are not independent experts cannot give opinion evidence.
What did the court decide?
The court declined to strike out the evidence. As a general finding, the judge agreed with the claimant that CPR PD 57AC does not change or overrule the existing law/authorities on admissibility of evidence. Hypothetical evidence as to what might have happened can fall within CPR PD 57AC, para 3.1. The judge also noted that the court’s power at CPR PD 57AC, para 5.2 to strike out evidence is discretionary in any event.
The judge distinguished the present case to JD Wetherspoon v Harris [2013] EWHC 1088 (Ch) , where a factual witness purported to provide expert evidence in his witness statement. In Wetherspoon, permission to adduce expert evidence had been expressly refused. In addition, the judge found that Wetherspoon recognises that there is flexibility in the rules in order to further the overriding objective and to deal with cases justly.
The court helpfully reviewed the authorities as to when a factual witness may give opinion evidence and concluded:
- First, s 3(2) of the Civil Evidence Act 1972 confirms that there is no absolute prohibition on non-expert witnesses giving opinion evidence.
- Second, there are authorities which support the proposition that a witness can give opinion evidence, particularly if the witness has relevant experience or knowledge (eg ES v Chesterfield and North Derbyshire Royal Hospital NHS Trust [2003] EWCA Civ 1284).
- Third, this is particularly so where the evidence is on a (relevant) hypothetical situation as to what could or might have happened (eg Globe Motors Inc v TRW Lucas Varity Electric Steering Ltd [2016] EWCA Civ 396). This is especially relevant on matters of quantum, where the court is trying to “do its best on the material before it” (per Capita Alternative Fund Services (Guernsey) Ltd v Drivers Jonas [2012] EWCA Civ 1417).’
Case details
Court: Commercial Court, Queen’s Bench Division
Judge: Sir Michael Burton GBE
Date of judgment: 8 July 2021
*This analysis was first published on Lexis®PSL on 20 July 2021.
