In matrimonial finance cases the assets owned by the parties have to be agreed, or valued by an expert witness. The courts will not proceed if valuations are in dispute.
The parties often start from the viewpoint that they want to instruct their “own” experts, who will be paid to “work for them”.
The family proceedings rules start from a different perspective. The thrust of the rules is that in virtually all cases, a court should direct that valuation evidence is carried out by a single joint expert. Such an expert (SJE) has a duty of impartiality, confidentiality and integrity towards the parties. It has a duty to report to the Court even though the parties will be picking up the bill. The courts want to ensure economy in the use of experts and a less adversarial approach. Separate experts, separately instructed, increase the costs and extend the time of the case. Any disputes between separately instructed experts have to be settled before trial if possible. If this cannot be achieved, then the first step of any trial would be for the Judge to hear evidence from the experts. Sometimes the court is able to prefer the evidence of one expert over the other, but the appeal cases are littered with decisions and comments from the Judges, that the differences in valuation contained in the disputed expert evidence was irrelevant to the outcome of the case. This is particularly so where there is a valuation of a business which is not going to be sold at any time in the foreseeable future.
If having received a single joint expert report, are the parties stuck with the contents of it?
Both parties have a right to raise questions of an expert after a report has been received, and single joint experts can be required to attend court to be questioned and give oral evidence.
It is also possible for a dissatisfied party to apply to the court for permission to instruct an independent expert witness, but this is not easy, cheap or without risk.
The leading case on the matter is still Daniels v Walker [2000]1WLR, where the then Master of the Rolls, Lord Woolf said “If, having obtained a joint expert’s report, a party, for reasons which are not fanciful, wishes to obtain further information before making a decision as to whether or not there is a particular part (or indeed the whole) of the expert’s report which he or she may wish to challenge, then they should, subject to the discretion of the court be permitted to obtain that evidence”.
Lord Woolf went further in a later case Peet v Mid-Kent House Care Trust [2002]1WLR, where he ruled that “the reasons now have to be somewhat more than unfanciful” for an expert from each party to be instructed rather than a single joint expert, and that, “special circumstances” are required.
In plain English, this means that the dissatisfied party has to make an application to the court and persuade the Judge that there is a good reason why they should have permission to get an independent expert. In reality, this means that to support the application, they have to have instructed an expert already, who should give at last their preliminary view or report specifying why the existing report of the single joint expert is flawed. Such an application therefore incurs the risk of incurring a second expert’s fees, and also the costs of the application. Although the general rule in family finance cases is that each party pays their own costs, if a discreet application is made within those proceedings, including a “Daniels v Walker” application and this does not succeed, then the Judge will normally award costs against the unsuccessful party.
A less risky strategy might be to consult a shadow expert to advise in the background. Such an expert would not be able to give evidence to the Court without permission, but could formulate questions to be asked of a single joint expert, both in writing before any trial, and as the basis of cross examination at a trial itself.