In British Airways v Spencer and others (present trustees of the BA pension scheme), Warren J has allowed, in part, an appeal against a deputy master’s refusal to grant permission to adduce expert evidence because it was unnecessary.
Background to the litigation
The meat of the litigation is that BA challenges decisions of the pension trustees to confer on themselves a unilateral power to grant pension increases and then to exercise that self-conferred power.
A central part of BA’s case is an allegation that the trustees had formed a plan to pay increases above those provided in the trust scheme’s rules. This was done so as to mitigate the impact of changes in government policy. They became so set on that plan that they closed their minds to other options. In the deputy master’s view, it was a case of predetermination in the operation of the scheme, which could be determined by a judge at trial without the assistance of an expert. BA said that actuarial evidence was necessary, however, in order to properly understand the approach that was taken by the trustees on the basis of (on BA’s case) flawed and changing actuarial advice.
Judgment of Warren J
The law on adducing expert evidence is contained in the deceptively simple CPR 35.1:
“Expert evidence shall be restricted to that which is reasonably required to resolve the proceedings.”
The judge expressed sympathy with the deputy master. The latter took the view that resolution of the central issues in the claim would not turn on whether or not the actuary’s advice was correct. It would turn on what his advice was, how it changed and on how the trustees responded to it. The factual question of predetermination would be relevant too.
The correct approach, however, is more technical. Clearly, evidence must be admitted where it is necessary to resolve an issue. If the evidence is not determinative of an issue, there needs to be a judgment about the assistance it will provide to the court on the basis of various factors enumerated, though not exhaustively, in the judgment.
In this case, Warren J allowed the appeal, thereby permitting BA to adduce the actuarial evidence. The deputy master’s decision to disallow expert evidence “wholesale” could not stand, as he had not given sufficient consideration to the various issues thrown up in the pleadings.
Upshot of the decision
This decision is a useful reminder of the principles applicable to adducing expert evidence, especially in high value cases (this one may yet cost BA to the tune of hundreds of millions). Forensic dissection of the issues, and a judgment about the extent to which expert evidence will be either determinative or of assistance, are required. Different rules apply.
CPR 35.1 refers to “proceedings”. Proceedings, however, are made up of perhaps a very large number of intertwined issues. Determining some of the issues may require expert evidence; others may not. As Warren J pointed out at paragraph 64, it is only at trial that it will become clear which issues have to be determined in order to resolve the proceedings. The pleaded issues must be examined in some detail to see whether expert evidence is necessary at that level. It will not be necessary if a pleaded issue cannot have any effect on the outcome of the proceedings.
A more difficult question pertains to evidence that is not necessarily determinative of an issue in the case, but would assist the court in understanding an issue. Evidence can be helpful even if it is not determinative of an issue (see paragraph 24 of Warby J’s judgment in Mitchell). CPR 35.1, then, is not a test of absolute necessity.
A judgement call needs to be made in every case between evidence that is absolutely critical to the resolution of an issue, and that which may be of marginal assistance. Disparate factors should be taken into account, including value, the effect of the judgment on the parties, who will foot the bill and the delay which will be caused by the production of any such evidence. The factors Warren J refers to suggest that such an analysis should be performed early on in the litigation. The later things get, the less likely it is that a party will be allowed to rely on helpful (rather than essential) expert evidence.