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Success Fees and Expert Evidence in the Upper Lands Tribunal

Special Reports

A recent Upper Tribunal decision has emphasised the importance of the independence of expert witnesses reflecting, if stopping short of adopting, the position in the courts, where the evidence of an expert acting under a contingency fee will only very rarely be considered (Gardiner & Theobald LLP v Jackson).

The Background

Gardiner & Theobald LLP instructed a firm of surveyors to advise them in relation to the 2010 ratings review as it impacted on their properties. The instruction was covered by a global retainer letter on a success-related fee basis, where a reduction in the rateable value was achieved.

Subsequently a dispute arose in relation to the rateable value of one of those properties and this was referred to the Valuation Tribunal and subsequently the Upper Tribunal. One particular surveyor was then appointed to act as an expert witness, outside the terms of the global retainer, on a fixed fee basis. However he also continued to represent the company under the terms of the retainer.

During the course of the ratings proceedings the surveyor declared, twice, that he was not instructed on a success-fee basis. Gardiner & Theobald LLP removed him as an expert on the basis of this declaration and the Upper Tribunal called a hearing specifically to deal with the issue of the nature of his instruction.

The Decision

At that hearing the Upper Tribunal found that, as a result of the success-related fee arrangement co-existing with the fixed fee arrangement for the expert evidence, and on the basis of the broad language used in those agreements, the declaration given by the surveyor in his capacity as expert witness was incorrect. They also found that it breached the RICS Practice Statement, which requires that a surveyor should not be remunerated under a conditional fee agreement.

The Upper Tribunal also confirmed that in accordance with the Tribunal Procedure (Upper Tribunal) (Lands Chamber) Rules 2010 it was the duty of an expert to help the tribunal and that duty overrode any duty to the instructing client and implied a duty to act impartially and independently. They considered that it was entirely unacceptable for an expert witness to fail to declare that the firm he worked for was instructed, even on a related matter, on a success/contingency fee basis which gave them a financial interest in the outcome of the proceedings.

The Implications

Whilst the Tribunal didn’t say outright that the use of a success-related fee arrangement would automatically bar an expert from acting (in fact, making arguments as to access to justice in favour of them), it was very clear that, where such an arrangement is in place, it should be disclosed at the earliest possible time in the proceedings (including at pre-action stage). This may have significant consequences given the front loaded approach required in the Check, Challenge, Appeal process for dealing with rating

Further, it is now clear that when instructing experts, either in the tribunal or the court, care should be taken to ensure independence at risk of having the expert’s evidence discounted and/or in terms of costs. As a result, and as a matter of best practice, where possible there should be a separation between any assistance being given on a wider basis and the specific requirements of providing expert evidence. This will have a cost consequence to what is already a process that requires considerable, early, outlay of funds.

Finally, the Upper Tribunal made clear that whilst this decision was given in relation to a ratings matter it would apply equally to compensation cases.

By Emma Pinkerton - Partner +44 20 7367 2065

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