COMMITTAL PROCEEDINGS AGAINST “EXPERT WITNESSES” ARE NOT AN ABUSE OF PROCESS

The decision of the Divisional Court in Accident Exchange Ltd -v- Nathan John George-Broom & Ors [2015] EWHC 2205 (Admin) is certainly a development in the practice relating to dismissal.

THE CASE

The claimants applied to commit a number of “experts” who gave evidence on spot hire rates in actions for car hire. The respondents applied to strike out the application.

KEY POINTS

  • This application for committal was not an abuse of process.
  • There was no evidence it was being brought for “improper motives”.
  • The fact that the police had declined to prosecute was irrelevant.
  • This was not, remotely, an appropriate case to strike out the committal application as an abuse of process.

THE JUDGMENT

Lord Justice Laws:

  1. These are applications by four respondents in contempt proceedings for orders striking out the claims against them. Permission to bring the contempt proceedings was granted to the claimant Accident Exchange Limited (AEL), by this court (Moses LJ and Irwin J) as long ago as 1 February 2012.
  2. The background may be sketched quite shortly. AEL was a company providing car hire services. They provided hire cars to persons whose own vehicles were off the road after a traffic accident. Insurers, who in the ordinary way bore the proper cost of the hire, very often challenged the charge that was made. The respondents to the contempt application (altogether seven in number) were all employed as rate surveyors by a company now in liquidation known as Autofocus Limited. In his judgment granting permission to AEL Irwin J (with whom Moses LJ agreed) took up the history as follows:
“3. Autofocus found a niche within the market giving evidence as experts on behalf of defendant insurers seeking to reduce those claims. There have been literally thousands of such cases tried and settled. As the applicant here would say: tried and settled in very many cases, on the basis of evidence given by Autofocus witnesses, effective in reducing the claims. It is suggested the evidence was based on fraud and perjury. Again, in very short compass, the suggestion is that these named respondents, and others within Autofocus, consistently presented reports to the other side, and in those instances where matters were contested gave oral evidence, to the effect that they had checked the spot rates for comparable vehicles within the relevant locality, or at least the relevant market, demonstrating that the credit hire companies’ charges were inflated and the claims therefore excessive. The suggestion is that that evidence was based on lies, and that there had not been the checks to establish the spot rates within the relevant markets that were claimed.
4. So far as Accident Exchange Limited is concerned, there are said to be some 3,600 cases, and the suggestion is that overall there may be in the region of 30,000 cases concerned.”
  1. In granting permission this court referred to KJM Superbikes Limited v Hinton [2008] EWCA Civ 1280 in which, among other learning, the judgment of Sir Richard Scott V-C as he then was in Malgar Limited v R E Leach (Engineering) Limited [2000] FSR 293 is referred to. In that case the Vice-Chancellor said:
“The general law of contempt is that actions done by an individual which interfere with the course of justice or which attempt to interfere with the course of justice are capable of constituting contempt of court. In order for the individual who has done acts which fall into that category to be liable for contempt, an appropriate state of mind of the individual must be shown. As to this the case law is not entirely clear and I am certainly not going to attempt to resolve it on this application. On one view it must be shown that the individual who is being prosecuted for this species of contempt intended to interfere with the course of justice. The other view is that it must be shown that the individual intended to do the acts in question, and that the acts interfere with the course of justice… But I think that it must in every case be shown that the individual knew that what he was saying was false and that his false statement was likely to interfere with the course of justice.”
Giving judgment on 1 February 2012 this court directed that as a matter of urgency the papers be served on the Attorney General.
  1. The respondents seeking orders striking out the claim are the 1st (Nathan George-Broom) the 2nd (Elaine Walker) the 4th (David James) and the 6th(Keel Broom). They variously allege that the proceedings are founded on weak evidence or have no real prospect of success, are so delayed as to make a fair trial impossible, are not in the public interest, disproportionate, and abusive as being motivated by the private interests of AEL. The Practice Direction to Civil Procedure Rule 81 provides at paragraph 16:
“16.1 On application by the respondent or on its own initiative, the court may strike out a committal application if it appears to the court –

(1) that the application and the evidence served in support of it disclose no reasonable ground for alleging that the respondent is guilty of a contempt of court;

(2) that the application is an abuse of the court’s process…”

  1. An important source of evidence from AEL’s point of view is an external hard drive onto which the liquidator of Autofocus had copied Autofocus’ computerised records. Pursuant to an order of HHJ Mackie QC made on 7 November 2011 AEL obtained a copy of this. It is referred to in the proceedings as the “Mirror Disk”. Its contents are described more than once in the papers before us. The claim form puts it like this:
“9 The Mirror Disk contains the telephone records and other documentation relating to Autofocus which not only establishes the wide-ranging nature of the dishonesty and fraud within Autofocus but also, specifically, supports the allegations that these defendants made multiple reports and statements such as those described at paragraph 6 above [essentially, asserting falsehoods], including in the cases set out in the Schedule attached hereto, which they signed with a statement of truth.”
The Schedule there referred to sets out a number of sets of county court proceedings in which the respondents are variously said to have verified documents with statements of truth which they knew to be false (or did not believe to be true) and/or (in the case of the 1st and 4th respondents) to have given false evidence on oath at trial.
  1. The Mirror Disk was obtained, as I understand it, after the application to commit for contempt was lodged but before permission was granted. In a second witness statement made on 14 February 2012 Mr. Stephen Anthony Evans, Chief Executive of Accident Exchange Group plc and a director of its wholly owned subsidiary AEL, summarises case by case the additional evidence on which AEL seeks to rely in order to prove the contempts alleged. This is introduced at paragraph 5 of the statement and described at paragraph 6 and following. Mr. Evans refers at paragraph 2 to the earlier affidavit of Jason Lee, of AEL’s then solicitors, for the background to the matter. Mr. Lee’s affidavit was sworn on 3 August 2011 and runs to 127 paragraphs. It is a comprehensive description of the history of the case and the detail of the allegations as they were seen at that stage by AEL.
  2. In fact the history goes back some time before that. In September 2009 AEL’s solicitors wrote to Autofocus and a number of the company’s directors, experts, and rate surveyors including the four respondents now before the court as applicants. They alleged that false statements had been made in county court proceedings. There followed a flurry of resignations from the company: the 1st defendant on 17 September 2009, the 2nddefendant on 25 September and the 6th (in effect) on 18 September. On 15 September 2009 Autofocus’ solicitor wrote to a member of the Bar to enlist his assistance on his client’s behalf, indicating that AEL had intimated a claim. It is instructive to note some of the contents of this e-mail:
“In brief, what appears to have happened is that, in a large number of cases, the lay rate surveyors have not made all or (in some cases) any of the telephone calls which they claim to have made in the evidence submitted in their reports… Autofocus has… checked telephone records and it appears that a significant number of calls have not been made, even though evidence has been given in witness statements of them having been made. Autofocus has also noticed from telephone records that some call durations are so low that they might only be long enough for the lay rates surveyor to get the name of an individual (for insertion into the report) from a hire company but not for full hire information to be exchanged. I am told by Autofocus that in its discussions with Helen Whyshall (a team leader at Autofocus who resigned on 17 September 2009, admitted contempt in proceedings brought against her and received a suspended prison sentence at the Northampton County Court on 15 March 2010) she has confirmed that she agreed with another rate surveyor for that other surveyor to do some of her work – but the relevant calls were never carried out by that other surveyor…
In substance, therefore, the complaint made by Accident Exchange is accurate – i.e. telephone calls said to have been made to hire companies had not in all cases been made…”
  1. Before coming to counsel’s submissions, I should say something about the role of the City of London Police in the history, since it figures prominently in the application for strike-out orders. On the evidence of Mr. Evans’ third witness statement, made on 2 June 2015, he (Mr. Evans) had a meeting with DI Clarke of the City Police on 19 June 2012. Mr. Evans says that the detective inspector told him, among other things, that he would only investigate allegations of perjury. I should note that the respondents raise an issue about this: it is said that there is contradictory evidence as to the stance taken by the police. Mr. Evans also asserts that DI Clarke made it clear that he did not wish to receive the Mirror Disk as part of his investigation, and I understand it to be common ground that the police have not seen the Disk. There followed a stay of the contempt proceedings, ordered by Stanley Burnton LJ on 3 July 2012, it seems in order to avoid any pre-emption of the police investigation. In fact the City of London Police had looked at the case earlier, before the grant by this court of permission on 1 February 2012: see paragraph 5 of Irwin J’s judgment. However, by June 2012 the papers in the case had been served on the Attorney General pursuant to this court’s direction. His office had forwarded them to the Crown Prosecution Service (no later than 28 February 2012) and the City of London Police were asked to investigate. There followed further communications with the police. At one stage Mr. Evans wrote to the Professional Standards Department of the City Police. Then on 30 July 2014 DS Massey announced that he considered the allegations advanced by AEL were not made out, and there was no realistic prospect of a criminal prosecution. Mr. Evans (paragraphs 11-12 of his witness statement of 2 June 2015) reports at some length a meeting on 28 August 2014 at which, it is asserted, he was “staggered” by what DS Massey said:
“11(b)….he said that the defendants had no professional training in respect of the justice system and because of that they could not know the meaning of the statement of truth when they signed a witness statement or the significance of swearing an oath when giving evidence in court. As a consequence, he said, it could not be established that they had intentionally deceived anybody and the court would be unlikely to convict on the basis of what was probably a mistake…
(d) the fact that we had the Mirror Disk in our possession threatened the entire investigation because we were open to allegations of tampering with evidence and there was doubt in his mind as to whether any prosecution would survive such an attack from a defence barrister.”
Mr. Evans later wrote indicating that the original of the Mirror Disk remained in the possession of the Autofocus liquidator. There is a contemporary note supporting Mr. Evans’ account of what DS Massey said.
  1. I turn to the submissions made in support of the applications to strike out. I will deal first with the contention that AEL’s evidence is weak or insubstantial (or in some particular instances, lacking altogether). I should indicate at once that this submission is not made by Ms. Padfield for the 2nd respondent. Her case was that in the circumstances there could be no fair trial of her client. I will come to that.
  2. Mr. Giles for the 1st and 6th respondents, and Mr. McGarry for the 4th, presented their submissions largely by reference to the state of the evidence concerning individual county court cases in which it is alleged that their clients knowingly made false statements. The cases are, as I have said, listed in the Schedule to the claim form. In some instances it is said that the verification of the allegedly offending statement was signed by a person at Autofocus other than the respondent in question. In others the argument is that the evidence of the statement’s falsity is hearsay. In yet others it is said that the facts relied on are merely asserted in a Schedule prepared by AEL or its lawyers, and no evidence in support has been produced. In at least one case the allegation is that there is no evidence that the 1st respondent was involved in the decision to use his witness statement at the county court trial. In at least one other the argument is that the offending material was added to the relevant statement by a person other than the respondent. In another it is claimed that certain phone calls said to have been made by the 6th respondent, though not vouched by the telephone records for the day on which they were said to have been made, nevertheless appear in records for the following day, so that there might merely have been a mistake.
  3. There is a rather more general argument that respondents may have used their private telephone land lines or mobile phones to make calls which are not recorded in the Autofocus records. It is submitted by Mr. Giles in his skeleton for the 1st and 6th respondents (paragraphs 48-93), yet more broadly, that “there is no real prospect of success and no reasonable grounds generally”.
  4. It is elementary – and common ground – that it is not for us on this strike out application to undertake a trial of the merits or anything remotely like it: if authority were needed, see Swain v Hillman [1999] EWCA Civ 3053. Of course if it were shown that the test for a strike out expressed in PD81 paragraph 16 were made out, the applications would be good. Under that test however, and in principle, it is manifestly not enough to point to aspects of the claimant’s evidence whose weight is doubtful or whose strength is questionable.
  5. Mr Rees QC for AEL has indicated that where, for example, there is no apparent testimony in the papers at present to support a particular assertion, and in some cases where the evidence is in the form of a written statement, AEL will apply to call the relevant witnesses. I should note that Ms. Padfield referred to a directions hearing (or a mention) on 31 March 2015 which she attended, and told us (by reference to her note) that it was then indicated that there would be no new evidence and/or the court itself gave an indication that it would not look kindly on any proposal to call new evidence. However it is clear from the order made on that day that the parties were granted liberty to apply; and there is plainly nothing in the nature of a prohibitory order to rule out evidence of the kind which Mr. Rees indicates he would wish to call. It must be obvious that if an application is made for directions to be given as regards the evidence to be called at the trial of the contempt claim, that will be dealt with by the court on its merits. The respondents’ points as to present gaps in the evidence, and the hearsay nature of some of it, cannot in the circumstances carry these applications.
  6. Mr. Giles raised what is perhaps a more fundamental point. He submitted that the only admissible evidence in relation to any specific allegation made by AEL is evidence which strictly and directly relates to that allegation: evidence which reveals more broadly what was going on at Autofocus would not be admissible. He cited no authority for this proposition. While it will no doubt be open to the respondents to advance this argument at the trial of the claim, it seems to me (without the benefit of extended argument) wholly unrealistic and contrary to principle. There is much force, I think, in these observations made by Mr. Evans at paragraph 32 of his witness statement of 2 June 2015:
“The court must consider matters as a whole, not look at each allegation in isolation, because when that is done the conclusion of a widespread conspiracy is overwhelming. AEL has, effectively, remitted the material by bringing sample counts. It did that when it only had “front end” evidence and it would be the most staggering coincidence if in each of those cases where the Autofocus records, subsequently discovered, showed no evidence of phone calls (or calls of sufficient length for the information purportedly provided to have been provided), that such lack of a record of the call was capable of an innocent explanation (particularly given the other evidence we have presented showing each respondent’s dishonesty in other cases…)”.
  1. Mr. Rees showed us material which, he submitted, more than amply justifies these observations. It is plainly arguable that that is so: although, precisely because we are not to try the issues, I will not descend into the detail. I should however mention some other specific points made by Mr. Rees. There is material to show that where one rate surveyor’s statement was altered by someone else, the maker of the statement was informed and this seems to have been treated as an acceptable practice. As regards the point taken concerning the telephone records, it is notable that each of the rate surveyors was provided with a designated land line at Autofocus’ expense for the specific purpose of making calls to car hire firms. In those circumstances, says Mr. Rees, the possibility that a rate surveyor might have used his own phone for the firm’s business is vanishingly unlikely. There is no evidence whatever of any expenses claimed by any rate surveyor for calls made on his or her private telephone. By contrast, there is material to show that some of them used the dedicated lines to make personal calls of their own.
  2. In all these circumstance I have for my part concluded that this is not remotely a case in which the contempt claim should be struck out for insufficiency of evidence.
  3. I turn to the issue of delay. I may first dispose of a specific point made by Mr. McGarry for the 4th respondent. He referred to material which showed that certain records relating to telephone calls, which would or might have been material to his client’s case, were deleted by the holder of the records after 185 days. But he declined positively to submit that the contempt proceedings against the 4th respondent must have been heard within the same period if they were not to fail for want of a fair trial. Yet that is the corollary of his reliance on this material. Clearly no such submission could be made. Mr. Rees was right to observe that time is inevitably taken up by the processes of investigation and preparation of issues to be litigated, and all the more so when the case is one of any complexity. The court will not conclude that a fair trial is impossible – and that is the only basis (relevant to this case) on which delay may support a strike out – merely upon its being shown that the passage of time has caused some difficulties for a party. The court will be astute to see that such difficulties are taken into account, and if possible ameliorated, in the trial process.
  4. As I have said the proposition that the delay in the case has deprived her client of a fair trial was at the centre of Ms. Padfield’s argument. She says that in some instances hearsay evidence does not properly indicate the source of the material, and that this compounds difficulties which she would now face in seeking to check facts or obtain evidence to refute AEL’s claims. She will not at this distance of time be in a position to recall specific telephone calls. Ms. Padfield raised a particular argument to the effect that though her solicitors now have a copy of the Mirror Disk and (as I understood her) succeeded in carrying out whatever decryption is necessary, nevertheless the material is vast in quantity and there will be real difficulty in absorbing it or analysing relevant material contained within it.
  5. The 2nd respondent was a director of Autofocus. She was, of course, involved in the management of the business. The question of her access to material relevant to the issues between her and AEL in this litigation is illuminated by correspondence from 2009 and 2010 which we were shown by Mr. Rees. As I have said she effectively resigned from the company on 20 September 2009. On 26 October 2009 she wrote to Mr. Mclean, chairman of Autofocus, asking for schedules of lay and expert reports (and copies) issued in her name or in which she was named as the surveyor. That was refused, apparently on solicitors’ advice. Somewhat later, on 5 March 2010, Autofocus wrote to her stating:
“During the course of your employment, you will have: (a) been sent documents and communications by Autofocus; (b) created documents in carrying out your function for Autofocus; and (c) had electronic access to Autofocus databases.”
The letter than states that she should not disclose any such material to a third party without Autofocus’ permission, and requests her to return any such documents to the then managing director. On 19 March 2010 the 2nd respondent replied, stating:
“… in relation to any or all of the said documents and communications whether in hard copy or electronic form that I may have in my possession I have no intention of using for any purpose save for in defence of legal proceedings that may be brought in the future either by Autofocus or by a third party as has been threatened. I am therefore more than happy to return any such information to you six years after the termination of my employment with Autofocus when the limitation period of any possible claims against me will have expired.”
  1. I do not consider it shown that the 2nd respondent will face such difficulties occasioned by the passage of time in this case that a fair trial will be denied her; nor will it be denied to any other respondent.
  2. I turn lastly to two related arguments. The first is that these proceedings are abusive because they have been launched by AEL for an improper motive. The second is that because the Police and/or the Crown Prosecution Service, after an investigation lasting some two years, have concluded that criminal proceedings cannot or should not be supported, the court, while not bound to follow the judgment of the prosecuting authorities, should conclude in the circumstances that there is insufficient public interest in the continuance of these proceedings and that they would represent a disproportionate use of judicial resources.
  3. The improper purpose alleged is that AEL sought and obtained permission to bring these proceedings in order to involve (or re-involve) the City of London Police with a view to persuading them to undertake a criminal investigation. I have seen no evidence whatever to support this accusation, and I reject it.
  4. As for the public interest in proportionality, in my judgment it is of the first importance to bear in mind that whereas it is the general duty of the Police and the Crown Prosecution Service to investigate crime and bring criminals to justice, it is the specific duty of the court to protect the integrity of the justice process. This court and the prosecuting authorities are therefore concerned with different, though no doubt overlapping, aspects of the public interest. Moreover it would appear that the decision not to prosecute Autofocus or these respondents was taken on the footing that the evidential test under the Code for Crown Prosecutors was not met: a test which has no application to these proceedings. That means, however, that the question whether a prosecution would be in the public interest was never arrived at. As for the position in this court, it seems to me that there is on the face of it a substantial case (I pass no judgment on its ultimate merits) to the effect that the course of justice has been comprehensively perverted up and down the country in the county courts; and that these respondents have played their part.
  5. There is in my judgment no proper basis on which this contempt claim should be struck out, and I would dismiss these applications.

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