Hong Kong – The “Growing Trend” – Appointment Of Single Joint Expert (SJE).

8 March, 2018

 

Where technical issues are involved in the matter under dispute, the appointment of expert(s) is inevitable, to assist the court in the just resolution of the dispute.  However, many who have experience in Hong Kong court proceedings would agree that cases involving expert evidence are often lengthy and expensive, especially where both parties have the resources to appoint their own expert for various specialist issues. In a recent judgment, Peace Mark (Holdings) Ltd (In Liquidation) and Another v Chau Cham Wong Patrick and Others[2017] HKCU 2782, of the Honourable Anthony Chan J, the court remarked that the engagement of a single joint expert (SJE), rather than separate experts (SE) by each party, is the “growing trend” and should be recognised as the mainstream in modern litigation.

 

A criticism of the magnitude of expert evidence was  expressed by the same judge in another recent high profile case, namely, Chun Wo Building Construction Limited v Metta Resources Limited HCCT 29/2013 (see our commentary on the Chun Wo case here: Court calls for changes in conduct of construction litigation).

 

Order 38 rule 4A of the Rules of High Court (O.38 r.4A of RHC) provides for the jurisdiction to appoint a SJE. A Practice Direction on Case Management specifies that the court will not give permission to a party to adduce expert evidence unless the appropriateness of appointing a SJE has been considered.

 

The rationale for  introducing O.38 r.4A as part of the Civil Justice Reform (CJR) in Hong Kong in 2009, was to make  the appointment of experts consistent with the underlying objectives of the CJR, namely to provide for the just resolution of disputes expeditiously and cost-effectively.

 

In the Peace Mark judgment, the court observed that under an adversarial system the parties often overlooked the principle that expert evidence is provided to assist the court on matters involving specialist knowledge and it is not to be treated as a tool to enhance the chances of winning a case.

 

Regrettably, the Court said, in its experience, litigants can simply shop around until they find a witness whose evidence suits their case and that the measures introduced by the CJR had not achieved the desired effect. The instruction of a SJE serves to avoid partiality, the Court said, and enhance the quality of assistance to the court. Even on issues which allow certain variation of opinion, an impartial expert with proper understanding of his duty to the court would be in a position to advise the court on such variation and such cases are not necessarily better served by having opposing expert evidence or SE.

 

In terms of costs and time, the court observed that instructing SE can have a very significant impact on the length of trial. Having a SJE serves to narrow down the issues and avoid the nuts and bolts disputes between SE. Even in the event of the need for any of the parties to instruct their own expert (subject to the leave of the court) due to disagreement with the evidence of the SJE on discrete issues, the costs involved will still likely to be a fraction of the costs required for instructing SE for the entire scope requiring expert evidence.

 

In the Peace Mark case, the court ordered that SJEs be appointed on (i) forensic accounting issues and (ii) Bermudan law. For forensic accounting issues, the court was of the view that accounting is a reasonably well-established discipline and it is not a case where the court will be assisted by receiving a range of opinions. SE would also entail four teams of accountants spending weeks to pore through the documents, which was not justified, notwithstanding the size of the Plaintiffs’ claim and importance of the issues. For Bermudan law issues, the court saw no proper justification why four experts were required on issues of company law, which were likely to be similar under Hong Kong law, given that Bermuda also applies a common law system.

 

What we can take away from these recent judgments is that the court will remain vigilant in upholding the underlying objectives of the CJR and ensure that the resources of the court are fairly distributed amongst court users. Litigants should be prepared that in the absence of proper justification (e.g. significant value of claim, importance of the expert issue, expenses that have already been incurred for instructing an expert, any significant difficulties that are likely to arise if a SJE is to be appointed), the court will generally be reluctant to give leave to appoint SE. There are of course some concerns that if  a SJE is appointed, parties may still instruct their own experts behind the scenes  to assist them  challenge  any  part of the SJE’s  evidence which they do not like, which somewhat  defeats the purpose of saving costs by appointing  a SJE.