OPINION EVIDENCE IN WITNESS STATEMENTS AND THE CASE THAT MAY HAVE SPARKED OFF THE JACKSON REFORMS: Multiplex -v- Cleveland Bridge

Whilst doing some work on the problems caused when lay witnesses attempt to give expert evidence I came across the case of  Multiplex Constructions (UK) LImited -v- Cleveland Bridge UK Limited [2008] EWHC 2220(TCC). It makes interesting reading for a number of reasons.

THE CASE

The action related to work done on the new Wembley Stadium. The claimant was the main contractor, the defendant the steelwork contractor. The action, in essence, was to draw up the final account between the parties.

THE LENGTH OF THE ACTION

There had been a trial on a preliminary issue which lasted a month.

  1. Preparation for main trial. Whilst the parties were battling out the eleven preliminary issues at all levels, their enthusiasm for the main fray never wavered. All thoughts of reaching a sensible settlement after resolution of the preliminary issues (as canvassed at the December 2005 case management conference) were seemingly jettisoned. The parties served pleadings, witness statements and evidence for the main trial, due to start in March 2008. CB pleaded their claim for payment in respect of work done in Scott schedule 2. Multiplex responded with a rival version of Scott schedule 2, setting out Multiplex’s valuation of the work. Multiplex pleaded their claim for damages, alternatively abatement for defects in Scott schedule 1 and their claim for damages for repudiation in Scott schedule 4, to all of which CB have responded. Two recent decisions of this court concerning the pleadings are Multiplex Constructions (UK) Ltd v Cleveland Bridge UK Ltd (No. 4) (“judgment 4”) [2008] EWHC 231 (TCC) andMultiplex Constructions (UK) Ltd v Cleveland Bridge UK Ltd (No.5) [2008] EWHC 569 (TCC) (“judgment 5”). Judgment 4 dealt with CB’s application to re-re-re-amend Scott schedule 2. Judgment 5 dealt with Multiplex’s application to re-amend Scott schedule 4C.
  2. The pleadings and their appendices fill several shelves. The total trial bundle (as expanded during the trial) occupies about 550 ring files.
  3. The trial. The parties have raised many hundreds of separate issues requiring decision. The volume of evidence is such that if all matters were to be explored in what may be called “the old style”, the trial would have lasted for well over a year. The parties did not wish to incur costs on that scale. Accordingly they entered into a “chess clock” agreement, whereby the trial would commence on 3rd March (subsequently put back to 10th March) and finish by the end of May, with the time available being shared equally. The trial duly proceeded on that basis and was concluded on Wednesday 28th May. The consequence of this accelerated programme was that many matters were touched upon very briefly at the oral hearing and much of the evidence has been left to my private reading.

There were then a number of post-trial hearings.

THE ROLE OF OPINION EVIDENCE

  1. The question whether Mr Taylor’s evidence is admissible arose in the following way. Reid Minty served Mr Taylor’s first witness statement on 20thDecember 2007 and his second witness statement (dealing with issues reinstated by the Court of Appeal) on 24th January 2008. On 5th February Clifford Chance wrote to Reid Minty objecting to numerous parts of CB’s evidence. In relation to Mr Taylor, Clifford Chance objected to paragraphs 30, 68-74, 86-128, 143-217 and 219-365 of his first witness statement, essentially on the grounds that these paragraphs contained opinion, comment, argument and expert evidence. Reid Minty responded on 6th February, suggesting that the simplest course was for the evidence to remain in and for the judge to make up his own mind as regards admissibility.
  2. At a hearing on 7th February Multiplex’s counsel referred to the admissibility dispute in paragraph 3 (a) of their skeleton argument. They stated: “If this matter is not resolved prior to trial, Multiplex considers that it can and should be dealt with at the commencement of the trial.” Mr Williamson for CB referred briefly to the issue during the hearing and asserted that CB’s factual evidence was admissible.
  3. Thereafter the dispute concerning the admissibility of CB’s evidence faded from view. Both parties referred to Mr Taylor’s evidence (including the disputed portions) in their opening notes. The trial proceeded. Mr Taylor gave evidence on day 17. Immediately after he left the witness box Mr Williamson commented on Mr Stewart’s failure to put his case on schedules 4C and 4D in cross-examination. Mr Stewart responded to the effect that Mr Taylor had not been called as an expert and his evidence about those matters was inadmissible.
  4. I did not regard it as satisfactory for this important issue to be left in limbo. Accordingly I directed that the matter should be argued out.
  5. Counsel duly prepared skeleton arguments on the issue. In a skeleton argument dated 20th April Mr Stewart contended that paragraphs 30, 68-74 and 85-365 of Mr Taylor’s first statement and the whole of Mr Taylor’s second statement were inadmissible on the grounds that these passages constituted (a) inadmissible expert opinion, for which permission had not been obtained under CPR Part 35 and (b) inadmissible comment, speculation or argument. It should be noted that Multiplex had not previously objected to Mr Taylor’s second statement. In a skeleton argument dated 21st April Mr Williamson contended (a) that Multiplex had lost the right to object to Mr Taylor’s evidence by waiver, estoppel or approbation and reprobation and (b) that in any event the evidence was admissible.
  6. The matter was listed for argument at 9.45 a.m. on day 22, with three quarters of an hour allowed, so as not to interrupt the evidence. Both counsel urged me not to rule on the issue at that stage, essentially for two reasons. First, the issue may become academic. Secondly, from the point of view of appeal it is better for the issue to be dealt with in the full judgment at the end of the trial.
  7. I did not regard it as satisfactory to proceed with a trial without ruling on whether evidence said by counsel to be important is admissible. However, I was persuaded by the combined submissions of counsel on both sides that I should do so in this case. It appeared that neither party would be prejudiced by embarking upon the expert evidence without knowing what factual evidence was admissible.
  8. In addressing the issue now, I shall first consider the question of admissibility; I shall then consider questions of waiver, estoppel and approbation in so far as they arise.
  9. In relation to admissibility, the first point to note is that Mr Taylor is called a factual witness. He has no experience of giving expert evidence and no knowledge of the requirements for giving expert evidence. He is not independent of CB, having been employed by a company in the Cleveland Group for the last eleven years. See day 17, pages 77 – 78. Permission has not been obtained or sought under CPR rule 35.4 to call expert evidence in relation to the “roof” issues which Mr Taylor addresses. CPR Part 35 constitutes the “rules of court” referred to in section 3 (1) of the Civil Evidence Act 1972.
  10. The second point to note is that Mr Taylor, like several other witnesses in this case, is a highly qualified and experienced engineer, who was involved for many months in the Wembley project. He is employed by DLT. In that capacity, between February and July 2004 he assisted CB in the design of roof connections and in dealing with erection engineering for the north and south roofs. He managed the north roof erection engineering team. It is not clear whether he managed the south roof erection engineering team. Between February and October 2005 Mr Taylor was engaged by Hollandia to assist in relation to erection engineering for the north roof. In the interval while Mr Taylor was absent from Wembley, Hollandia had taken the basic decisions as to how they would erect the north and south roofs. Mr Taylor’s role was to assist with the detailed implementation of those decisions in relation to the north roof. It is self evident that in order to perform his functions in 2005, Mr Taylor had to understand the decisions which had been made while he was away and to read the relevant documents. It is clear from the evidence that Mr Taylor had many discussions with Hollandia’s engineers; the relationship between DLT’s engineers and Hollandia’s engineers was one of mutual respect. One cannot look at the north roof in isolation from the south roof, not least because of their complex interrelationship. An engineer could not design the detailed erection engineering for any part of the roof, without fully understanding the overall methodology. Furthermore there is a continuing interaction between permanent works connections design and erection engineering. Decisions made in each discipline affect the other. I shall therefore treat Mr Taylor as a factual witness who (a) is possessed of considerable engineering expertise and (b) has personal knowledge of the roof design and erection engineering decisions which were made in the period February 2004 to October 2005.
  11. The question then arises as to whether Mr Taylor is confined to giving evidence of fact, without including his expert opinion on matters. Alternatively, can he include statements of professional opinion bearing upon facts within his personal knowledge?
  12. This question arises in many fields of litigation, for example professional negligence actions where the defendant is a witness of fact but also wishes to justify his actions by drawing upon his professional experience. This question arises with particular frequency in litigation in the Technology and Construction Court. Most factual witnesses called are possessed of technical knowledge and expertise. In relation to major engineering projects (such as Wembley Stadium or the M6 Toll Road) those factual witnesses are likely to have very considerable expertise. Otherwise they would not have been engaged upon such projects in positions of responsibility.
  13. Despite the diligent researches of counsel, there is relatively little authority on the extent to which witnesses, who are possessed of special expertise, can gloss their factual evidence with expert comment.
  14. In Lusty v Finsbury Securites Ltd (1991) 58 BLR 66 the Court of Appeal held that an architect suing for fees could give opinion evidence as to the value of his work. In DN v LB Greenwich [2004] EWCA Civ 1659 the Court of Appeal dismissed an appeal against the trial judge’s finding that an educational psychologist had been negligent. One of the issues in the appeal concerned the admissibility of opinion evidence given by the psychologist. Brooke LJ said this:

” 25. It very often happens in professional negligence cases that a defendant will give evidence to a judge which constitutes the reason why he considers that his conduct did not fall below the standard of care reasonably to be expected of him. He may do this by reference to the professional literature that was reasonably available to him as a busy practitioner or be reference to reasonable limits of his professional experience; or he may seek to rebut, as one professional man against another, the criticisms made of him by the claimant’s expert(s). Such evidence is common, and it is certainly admissible. Mr Phillips, who appeared for the claimant at the trial, did not believe he had told the judge that Mr Moreland’s evidence on matters of this kind was inadmissible, and neither of the very experienced leading counsel who appeared in this counsel who appeared in this court was willing to support the judge’s view of the matter.

“26. Of course a defendant’s evidence on matters of this kind may lack the objectivity to be accorded to the evidence of an independent expert, but this consideration goes to the cogency of the evidence, not to its admissibility. That such evidence was in principle admissible should have been reasonably apparent from the judgments in this court in ES v Chesterfield and North Derbyshire Royal Hospital NHS Trust [2003] EWCA Civ 1284 at [24], [31]]-[32] and [41], [2004] Lloyd’s Rep Med 90.”

  1. As a matter of practice in the TCC, technical and expert opinions are frequently expressed by factual witnesses in the course of their narrative evidence without objection being taken. Such opinion evidence does not have the same standing as the evidence of independent experts who are called pursuant to CPR rule 35. However, such evidence is usually valuable and it often leads to considerable saving of costs.
  2. Having regard to the guidance of the Court of Appeal and the established practice in TCC cases, I conclude that in construction litigation an engineer who is giving factual evidence may also proffer (a) statements of opinion which are reasonably related to the facts within his knowledge and (b) relevant comments based upon his own experience. For example, an engineer after describing the foundation system which he designed may (and in practice frequently does) go on to explain why he believes that this was appropriate to the known ground conditions. Or an engineer brought in by a claimant to design remedial works (which are subsequently challenged as excessive) may refer to his experience of rectifying comparable building failures in the past. For example, such evidence may be given in cases about concrete failure through ASR (a world wide problem).
  3. With this guidance in mind, I turn to the two witness statements of Mr Taylor. These witness statements include narration of facts which are within Mr Taylor’s knowledge, expressions of engineering opinion upon those facts, relevant comments based upon his own experience, statements of opinion on matters outside his expertise, argument and gratuitous comment on matters which are for me to decide.
  4. If Multiplex’s objections had been raised at the outset of the trial, a pruning exercise could have been carried out and the statements could have been re-drafted by CB’s solicitors. Such an exercise is not now realistic. No objection was ever raised to Mr Taylor’s second statement until after he had left the witness box. The objections to his first statement were raised in correspondence but then were left on one side until the matter surfaced after his oral evidence was complete. Mr Taylor’s two witness statements together span 143 pages. It is not a realistic task for me to append all 143 pages to this judgment indicating which parts are admissible and which are not. I therefore propose to apply the principles set out above and to have regard only to those parts of Mr Taylor’s statements which are admissible by reference to those principles.
  5. The unfortunate and partisan manner in which Mr Taylor’s statements have been drafted tends to reduce the credibility of his evidence. On the other hand, I note that many of Mr Taylor’s views were accepted by Multiplex’s witnesses, when put in cross-examination. I conclude that the presentation, but not the underlying content, of Mr Taylor’s witness statements was unduly influenced by CB’s lawyers. Furthermore, Mr Taylor gave his oral evidence in a fair and candid manner, despite his admitted close connection with CB. These are all matters which I take into account when assessing the weight to attach to those parts of Mr Taylor’s evidence which are admissible.
  6. Finally, it should be noted that a number of factual witnesses called by Multiplex included expert opinion within their statements (although these statements were drafted in more moderate and appropriate language than that of Mr Taylor). No objection is taken to the admissibility of those statements.”

THE OUTCOME:NOBODY IS A WINNER

CHAPTER 37. THE LESSON TO BE DRAWN FROM THIS LITIGATION

  1. At the request of counsel, I have deferred finalising this chapter until after hearing submissions on costs. The Technology and Construction Court exists to provide a dispute resolution service to the business community and pre-eminently to the construction industry. In many cases, of which the present is typical, both parties are members of the construction industry; they have a dispute about a final account and usually a cross claim for damages. The normal and sensible way of resolving such matters is for the court to decide questions of principle and for the parties then to sort out the financial consequences. This approach generally leads to the resolution of multi-million pound disputes at proportionate cost, and enables the parties to get back to their real business.
  2. The present case began in conventional manner. At a case management conference in December 2005, I had in effect a “round table” discussion with leading counsel in which we identified the crucial issues of principle between Multiplex and CB. These were then determined as preliminary issues at a five week trial in April and May 2006: see Multiplex Constructions (UK) Ltd v Cleveland Bridge UK Ltd [2006] EWHC 1341 (TCC). In the last two paragraphs of my judgment on those ten preliminary issues I said:

“666. Finally I wish to say something directly to the parties. It has been obvious to me that no settlement could be achieved whilst certain fundamental issues were unresolved. The present set of preliminary issues was drafted by counsel precisely in order to break that deadlock. Both parties have had a measure of success on the preliminary issues. Neither party has won an outright victory. With the assistance of this court’s decision on the ten preliminary issues, it may now be possible for both parties to arrive at an overall settlement of their disputes, either through negotiation or else with the help of a mediator, who is unconnected with this court.”

“667. I commend this course to the parties, if only as a means of saving costs and management time. If, however, the parties would prefer the court to resolve all remaining issues, then so be it. This court encourages sensible commercial settlements, but nevertheless stands ready to determine every issue which the parties wish to litigate”

  1. Following that judgment the parties attended a mediation. However, instead of reaching a sensible resolution at that mediation, the parties spent the next two years litigating about two matters, namely Multiplex’s claim for damages and CB’s claim for a final account. Multiplex’s claim for damages was subject to a £6 million cap and has, in the event, been assessed at £151,309. CB’s claim for a final account involved a host of valuation issues, of which – inevitably – some went in favour of CB, some went in favour of Multiplex, and many were assessed at a figure somewhere between the extreme positions adopted by the two parties. A resolution broadly along the lines of this judgment could have been arrived at by the parties at fractional cost, if both parties had instructed their advisers to go through the accounts together in a constructive spirit taking as their starting point the court’s decision on issues 1 to 10.
  2. The procedure adopted by the parties for drawing up the final account on the steelwork package for Wembley Stadium is surprising to say the least. A trial bundle of some 550 ring files has been assembled. The cost of photocopying alone is approaching £1 million. The pleadings, which incorporate schedules, counter-schedules and appendices, run to literally thousands of pages. Each side has fielded a team of experts, solicitors, leading counsel and two or three junior counsel. There have been two rounds of preliminary issues (the second to deal with new matters pleaded in August 2006), two trips to the Court of Appeal, innumerable applications, cross-applications, amendments to the pleadings and finally a three month trial of all valuation and damages issues. Every little point has been fought out, some orally and some on the basis of written evidence and argument. Since 5th June 2006 (when issues 1 to 10 were decided) the parties have run up costs of some £14 million. These costs are in addition to pre-June 2006 costs of some £8 million. That level of expenditure far exceeds the sums which (after stripping out the froth) are seriously in dispute between the parties. Furthermore costs were only limited to that level by reason of the fact that (a) there was a “chess clock” agreement to limit the length of the trial to three months, (b) counsel on both sides worked prodigiously hard to compress their oral presentation into that narrow period.
  3. The final result of this litigation is such that (when costs are taken into account) neither party has gained any significant financial benefit. Instead large sums of costs and a large amount of management time have been expended on both sides to no useful purpose. Both parties have a measure of responsibility for this situation. Over the last two years both parties have brushed aside repeated judicial observations on the wisdom of settling this particular litigation. Each party has thrown away golden opportunities to settle this litigation upon favourable terms. Those golden opportunities continued to arise during the run up to trial and even during the first month of trial. In the judgment on costs, which is about to be delivered, I shall consider the apportionment of responsibility as between the parties for the final unhappy outcome.
  4. The lesson for the future which may be drawn from this litigation is that parties would be well advised to use the dispute resolution service offered by the Technology and Construction Court in a more conventional and commercial manner than has been adopted in this case. Once this court has decided questions of principle, the parties can save themselves and their shareholders many millions of pounds by instructing their advisors to agree reasonable figures for quantum, if necessary with the assistance of a mediator unconnected with the court. If one party is not prepared to negotiate, then the other party can protect its position by making a timely and realistic offer under Part 36. The court’s decision on preliminary issues should be used by both parties as a basis for sensible discussion or at least as a basis for sensible assessment. It should not be used as a platform from which the victor on the preliminary issues launches new and ill thought out claims in order to transform its case on quantum. Finally, I wish to place firmly on record that what has happened in this case is in no way typical of litigation in the Technology and Construction Court.

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