[2024] EWHC 1257 (TCC)

The main application before the court is the claimants’ application, issued on 25 April 2024, seeking permission for a new structural engineering expert in place of Mr Andrew Hardy together with consequential directions.

The sixth defendant (“AXA XL”) by its application issued on 23 February 2024 seeks the revocation of the claimants’ permission to rely on the evidence of Mr Hardy. This application is, effectively, conceded.

Against a background of the Claimants’ admitted interference in the expert process, AXA XL resists the appointment of a replacement expert alternatively submits that any permission should be conditional on extensive disclosure of without prejudice communications with Mr Hardy. By the time of the hearing the claimants had identified Richard Tant of Richard Tant Associates as the replacement expert they wished to retain.

The third matter before the court concerns an earlier application by the claimants issued 16 February 2024 seeking an extension of time for service of a Schedule of Loss. The costs of that application remained to be determined however it was apparent from the parties’ skeleton arguments before me that the parties are now in agreement as to the appropriate costs order.

The applications occupied a full day on Friday 3 May 2024. Given the timetabling issues that arose, I told the parties that I would provide my decision after the Bank Holiday Monday with full reasons to follow. On Wednesday 8 May I made the order set out at the end of this judgment. This judgment contains the reasons for that order.

The claimants are the owners of 124 Westbourne Grove, London, W11 2RR. It is not in issue that in around 2016 they commenced renovation works including the creation of a new basement. Whilst carrying out these works damage was suffered to surrounding properties including 122 Westbourne Grove (“the adjoining owners”).

By its Particulars of Claim dated 4 July 2022 the claimants brought claims against a number of parties including Chase Construction (Contracts) Limited, the original building contractor for the works and Fluid Structural Engineers & Technical Designers Limited the appointed structural engineers for the works. I am advised that the other claims have been compromised and the claimants now only proceed against AXA XL.

The claimants updated schedule of loss dated 1 March 2024 identifies a VAT inclusive sum of £1,881,005.61 in respect of damage to 122 Westbourne Grove.

The claimants seek a declaration that they are entitled to an indemnity from AXA XL under an insurance policy issued in their favour. By its defence dated 26 August 2022, AXA XL seeks to rely on what it contends are an extensive range of exclusions in the XL policy excluding liability for damage that (i) was the fault of the builder or designer, (ii) was inevitable damage, (iii) was recorded in a survey attached to the policy or (iv) was due to works undertaken prior to the start of the policy. It can therefore be seen that issues as to the cause, nature and extent of damage and when it occurred are central issues between the parties.

The trial is listed to commence on 16 September 2024 with a reading day, 5 days of evidence with oral closing submissions to follow on 26 September 2024.

On 22 March 2024 a party wall award was issued in relation to a dispute between the claimants and adjoining owners. This found the sum of £1,832,638.76 as payable by the claimants to the adjoining owners. That award is the subject of an appeal dated 3 April 2024.

At the costs and case management conference on 4 April 2023 HHJ Stephen Davies gave permission to the parties to call expert witnesses in respect of structural engineering and quantum. That evidence was timetabled in the usual way to rule 35.12(3) statements followed by experts’ reports.

The claimants engaged Mr Hardy as their structural engineering expert. AXA XL engaged Mr Howard Tucker.

The Rule 35.12(3) statement evolved through various drafts reflecting discussions between the experts. When the draft was at an advanced stage Mr Tucker expressed his concern to RPC, solicitors for AXA XL, as to what he believed to be significant changes to Mr Hardy’s views recorded in the latest version. Put shortly, Mr Tucker was concerned that on the face of it there appeared to have been involvement from the claimants’ lawyers.

A joint statement was nevertheless agreed and signed on 3 November 2023.

By letter dated 12 December 2023 RPC wrote to Pennington Manches Cooper (“PMC”), solicitors for the claimants addressing complaints made by PMC as to delays in finalising the experts’ joint statement:

“….

With respect to your comments on the delay regarding the preparation of the Experts’ Joint Statement (EJS) we have discussed the matter with our Expert, Mr Tucker, and understand that the delay arose due to substantive changes having been made to the EJS between V3 and V4 by Mr Hardy. For the avoidance of doubt, we are not suggesting that there is any loss of privilege over the drafts of the EJS, but between V3 and V4 we are advised that there were significant changes to the matters that had been agreed to the draft.

Mr Tucker has advised us that he was unable to account for the changes made between V3 and V4, but that he considered the nature of the amendments made and the language employed suggested that there may have been involvement from lawyers.

We trust that the Claimants’ legal team complied at all times with the guidance in paragraph 13.6.3 of the TCC Guide. However, in light of the concerns raised by an independent expert and as a matter of professional courtesy, we feel obliged to raise the matter with you and provide you an opportunity to respond. We trust that Mr Tucker’s concerns are unfounded, but to put the matter to rest we invite you to confirm that Mr Hardy was not provided with instructions as to the substance or wording of the draft EJS; that he was not provided with wording for the draft and that he was not asked to include certain opinions or to alter opinions already expressed in draft. We would ask you to confirm that you have provided by Mr Hardy with a copy of this letter.

…

”

In its letter of 14 December 2023 PMC addressed a number of matters. On the issue of interference in the Joint Statement process it stated :

“ …

3.

An adverse inference will be drawn that there was no reasonable basis for Mr Tucker not to have prepared his Expert Report on time.

4.

Instead, your letter relays an unsubstantiated attack by Mr Tucker on the independence of Mr Hardy with respect to the EJS which is denied. This attack is surprising considering that Mr Tucker’s approach to the EJS appears contrary to CPR 35.12(1)(a) requiring that the discussions between experts is to identify and discuss the expert issues in the proceedings (bold added for emphasis). Without waiver of privilege and whilst this should not be necessary to detail but for the unsubstantiated attack on Mr Hardy’s independence, it is noted that Mr Tucker’s drafting of the EJS:

a.

initially failed to deal with the pleaded issues as to the inevitability of damage;

b.

avoided referring to the Scott Schedule prepared by the parties in dealing with timing of damage;

c.

initially failed to deal with AXA XL’s own pleaded issues as to theories of negligent causes of movement, which were then generally rebutted by Mr Tucker in contradiction with AXA XL’s pleaded case;

d.

an excessive detailing of issues relating to front garden underpinning, largely unsupported by AXA XL’s pleaded case, to support AXA XL’s current main argument on the cause of movement;

e.

raised an unparticularised cause of movement with respect to item 4.16;

f.

failed to deal with the pleaded issue of remedial works despite this being an issue that is relevant to the experts.

5.

The above suggests either influence by AXA XL’s legal representative with Mr Tucker’s approach or Mr Tucker’s failure to adopt an independent approach with the EJS with respect to the issues in the proceedings.

6.

We do not believe there was a delay between V3 and V4 of the EJS but there was a delay between Mr Hardy issuing V4 of the EJS on 12 October 2023 and Mr Tucker issuing V5 of the EJS on 1 November 2023 (a mere 2 days prior to the Court deadline of 3 November 2023). Without waiver of privilege, it is denied that this delay was as a result of alleged significant changes by Mr Hardy but was due to Mr Tucker having other work commitments (as you yourselves suggest in your letter of 29 November 2023)

…”

In a brief response on 21 December 2023, RPC stated :

“…

We will respond to the balance of your letter in due course but are troubled by your failure to address the questions we posed with our letter of 12 December 2023 regarding whether you complied with your duties in respect of the preparation of the Joint Statement.

Whilst we indicated in our letter that we trusted that everything would be in order, it should be appreciated that the failure to answer our questions now means that our client has an active concern regarding this issue. We repeat our request for answers and invite you to confirm a date for a response.

We invite you to confirm that you have placed a copy of our letter of 12 December 2023 before Mr Hardy.

…”

That letter of 21 December 2023 did not receive a response until PMC’s letter 16 January 2024, the material parts of which are set out below:

“…

3.

You seek to complain that we did not answer questions posed in your letter of 12 December 2023. However your letter of 12 December 2023 did not pose any questions and our letter of 14 December 2023 provided a very prompt and sufficient answer to the points made in your letter, having regard to the privileged nature of the discussions to which it related.

4.

Indeed, it is evident that not only do your letters seek to discuss the without prejudice communications between the parties’ experts in open correspondence, they also enquire as to our privileged communications with our client’s experts. As you will know when enquiring as to these communications, we are unable to divulge details of them to you. There is something contrived about you making enquiries that you know we cannot answer and then quickly seeking to draw an adverse inference from our appropriately discreet response.

5.

What we can say, with respect, is that it appears to us from Mr Tucker’s conduct (no privilege waived) and from your correspondence that he and your firm appear to be taking an erroneously restricted view of the role of solicitors in relation to the preparation of an Experts Joint Statement.

6.

We respectfully request that you consider carefully paragraph 13.6.3 of the TCC Guide to which you have referred. This expressly acknowledges and permits legal advisers to identify the issues that the Joint Statement should address and where necessary, to invite the experts to consider amending the draft Joint Statement where there are serious concerns that the Court may misunderstand or be misled by the terms of that Joint Statement.

7.

We also refer you to section 75 of the Civil Justice Council’s Guidance for the instruction of experts in civil claims that : “In multi-track cases the parties, their lawyers and experts should co-operate to produce an agenda for any discussion between experts, although primarily responsibility for preparation of the agenda should normally lie with the parties’ solicitors” (bold added for emphasis). This also serves to confirm the important role played by solicitors in identifying the issues that the joint statement should address.

8.

Without waiver of privilege, we confirm that our approach to giving directions to experts in any litigated case (and we specifically confirm that this one is no exception) is entirely in line with the above. In short, we offer guidance to experts in an attempt to ensure they address the pleaded issues and do so clearly. The substance of their views are a matter for them and we do not (and have not here) sought to supplant our views for theirs.

…”

Perhaps understandably, that response did not satisfy RPC who responded on 24 January 2024. This was a lengthy letter, extracts of which I set out below :

“The assertion that the 12 December 2024 letter did not contain any questions is not understood. It stated :

“We invite you to confirm that Mr Hardy was not provided with instructions as to the substance or wording of the draft EJS; that he was not provided with wording for the draft and that he was not asked to include certain opinions or to alter opinions already expressed in draft. We would also ask you to confirm that you have provided Mr Hardy with a copy of this letter.”

No such confirmations have been received, nor any answers to those questions.”

RPC then proceeded to repeat the questions.

The letter of 24 January 2024 also addressed paragraph 13.6.3 of the TCC Guide. It observed that the Civil Justice Council’s guidance was directed to settling the agenda for experts meetings whereas the particular concern of AXA XL concerned the changes between revisions 3 and 4 of the EJS. In that regard, reference was also made to BDW Trading Ltd v. Integral Geotechnique (Wales) Ltd[2018] EWHC 1915 (TCC) highlighting the following in paragraph 18 of the Judgment of HHJ Stephen Davies :

“What happened here was, I agree, a serious transgression and it is important that all experts and all legal advisers should understand what is and what is not permissible as regards the preparation of joint statements. To be clear, it appears to me that the TCC Guide envisages that an expert may if necessary provide a copy of the draft joint statement to the solicitors, otherwise it would not be possible for them to intervene in the exceptional circumstances identified. However, the experts should not ask the solicitors for their general comments or suggestions on the contents of the draft joint statement and the solicitors should not make any comments or suggestions save to both experts in the very limited circumstances identified in the TCC Guide. This is consistent with the fact that any agreement between experts does not bind the parties unless they expressly agree to be so bound (see Part 35.12(5)). There may be cases, which should be exceptional, where a party or its legal representatives are concerned, having seen the statement, that the experts’ views as stated in the joint statement may have been infected by some material misunderstanding of law or fact. If so, then there is no reason in my view why that should not be drawn to the attention of the experts so that they may have the opportunity to consider the point before trial. That however will be done in the open so that everyone, including the Trial Judge if the case proceeds to trial, can see what has happened and, if appropriate, firmly discourage any attempt by a party dissatisfied with the content of the joint statement to seek to re--open the discussion by this means.” (emphasis added)

RPC then observed:

“Importantly, and as that judgment makes clear, the very limited exception envisaged by paragraph 16.3.6 of the TCC Guide enables the lawyers to bring to the experts’ attention that there is some material misunderstanding “of law or fact” (where there is a serious risk that the court might be misled). It does not permit the lawyers to comment on the substance of the draft joint statement or the opinions expressed therein, save only to correct a material error of law or fact. If you disagree with that statement of the position in law, please explain why.

...”

RPC continued later in the letter of 24 January 2024:

“We and our client have grave concerns regarding the proprietary of the expert joint statement process. We believed that these concerns could readily be put to rest in correspondence with you. It is a matter of real regret that this has not yet occurred and that, instead, your continuing evasiveness of this issue heightens our concern that there has been a serious transgression of the rules governing expert evidence.

…”

In its final paragraph RPC stated :

“In the event that this matter is not resolved shortly, we put you on notice that our client intends to make an application to Court. Without prejudice to our client’s rights in full, the relief sought would include withdrawing the Court’s permission for the Claimants to rely on Mr Hardy’s evidence and/or permission to cross-examine Mr Hardy on this issue at trial and/or making the right to rely on Mr Hardy’s evidence at trial conditional upon disclosure of versions 3 and 4 of the EJS and/or of the comments thereon made by the Claimants’ legal team. We would invite you to take note of the BDW case referred to above, as well as Dana UK Axle Ltd v. Freudenberg FST GmbH [2021] EWHC 1413 (TCC) and Andrews v. Kronospan Ltd [2022] EWHC 479 (QB).”

As set out above, on 23 February 2024 AXA XL issued an application seeking the revocation of the claimants’ permission to rely on the evidence of Mr Hardy.

In its letter of 14 March 2024 referring to the application PMC stated :

“….

Without waiver of privilege and any further admissions, we have determined that our conduct of the joint statement process was not fully in compliance with the applicable rules and/or guidance. Any non-compliance is not an admission of any compromising of Mr Hardy’s independence nor his expert views. This non-compliance was by our firm and not by our clients who are lay clients who were not involved in this process. Our clients should not be prejudiced in being able to present its case on equal footing as a result of any non-compliance by us and the sanctions requested by your client’s application. Your client is requested to bear this in mind in terms of its response to the proposal set out in this letter than may unfairly penalise our clients

We have set out in this letter our proposals to remedy this non-compliance which will be the most time and cost effective course of action.

We propose that the parties agree an order setting out the following :

1.

Our clients’ permission to rely on expert evidence from Mr Andrew Hardy is revoked. Our clients retain their permission to rely on expert evidence and structural engineering (as granted at paragraph 9.a of the order of HHJ Stephen Davies of 11 April 2023) from an alternative structural engineer.

2.

The parties’ engineering experts carry out the joint statement process, with the parties’ solicitors to endeavour to agree an agenda for discussion in advance.

3.

The parties’ engineering experts issue their Part 35 reports.

4.

Our clients shall bear their own costs and cover your client’s reasonably incurred costs for re-doing the engineering experts’ joint statement and report stages.

5.

Our clients shall cover your client’s cost of their application up to date.

…”

The final letter relevant in this exchange to which I need to refer is from RPC dated 21 March 2024. That letter noted that the statement made in PMC’s letter of 16 January 2024 that its approach to giving directions to experts in any litigated case was entirely in line with paragraph 13.6.3 of the TCC Guide and section 75 of the Civil Justice Council’s guidance on experts was not true. RPC observed it was disappointing that it required an application to the court for the true position to be acknowledged. In addressing the proposals made:

“….

5.

You appear to assume that, because no expert was named in the CCMC Order it granted permission to rely on expert evidence, your clients are at liberty to change their report. That is misconceived: see Edwards-Tubb v. JD Wetherspoon Plc [2011] 1 WLR 1373 in particular per Hughes L.J. at [27]

…

8.1

This is, on the Claimants’ own case, an instance of expert shopping. It is a particularly egregious example. Having committed serious transgressions of the rules of Court – and, in so doing, having fatally undermined the credibility of their expert – the Claimants now wish to change experts so as to avoid the inevitable consequence of those actions. That amounts to the Claimants taking advantage of their own wrong. It would be contrary to the interests of justice.

…

10.

It seems to us that the way forward is for the Claimants to prepare a draft application for permission to change their expert (which would also amount, in part, to a response to AXA’s extant application) and that this should be provided to us in draft before being issued. It may be that the draft application and draft supporting evidence might need AXA to review the position set out above. To be clear, however, that would require the draft to deal squarely with the matters set out above. In particular, it is our view that the application must provide full and proper disclosure of the comments / instructions given to Mr Hardy in respect of the changes to the draft joint statement (and any communications / drafts in which those are set out or recorded). We note that this was the approach taken by the applicant in Andrews v. Hardy [2022] EWHC 479 (QB) in similar circumstances to the present case.

…”