JP Morgan Chase Bank & Ors v Springwell Navigation Corporation

Expert evidence in civil proceedings must be both properly admissible and reasonably required to resolve the proceedings. It must genuinely assist the trial judge and must address expertise, rather than findings of fact or the ultimate assessment of proved facts. Experts may explain technical matters outside ordinary judicial experience, but contractual construction remains for the court. In large commercial disputes, the court should exclude reports that are speculative, duplicative, excessively broad or likely to create satellite litigation. Applications seeking to determine fact-sensitive damages principles before trial should generally be refused where the necessary factual findings have not yet been made.

Chase brought proceedings seeking declarations of non-liability in connection with Springwell’s allegations concerning investment advice, emerging-market securities and substantial portfolio losses. The action was due to proceed to a lengthy trial.

Chase applied to exclude parts of four expert reports. Springwell applied to strike out, or obtain summary judgment on, part of Chase’s pleaded case concerning the date for assessing loss. The court had to determine the admissibility and proper scope of the proposed expert evidence and whether the damages issue should be decided before trial.

1. Expert evidence. Under section 3 of the Civil Evidence Act 1972 and CPR Part 35.1, the party seeking to adduce expert evidence must establish that it is admissible and will genuinely assist the trial judge. The expert must have sufficient knowledge and experience, and the subject must concern a recognised body of knowledge on which expert testimony is permissible. The court adopted the approach in R v Bonython [1984] SASR 45.
2. Experts may express opinions on the standard of professional practice, including by reference to assumed facts. They must not decide disputed facts or state what they personally would have done. A judge must apply the relevant professional standard to the facts found at trial.
3. Construction of the DDCS letters was a question of law for the court. Expert evidence could explain technical expressions outside judicial expertise, as illustrated by Kingscroft Insurance Co Ltd v Nissan Fire & Marine Insurance Co Ltd (No. 2) [1999] Lloyd’s Insurance and Reinsurance Reports 603. That circumstance did not arise here. Ms Morse’s report was excluded. Section 6 of Mr Kraus’s report and sections 4, 6 and 7 of Mr Dicker’s report were also excluded as speculative, fact-dependent or unnecessary. Section 2 and section 5 of Mr Dicker’s report were admitted, subject to the stated limitations. Mr Hass’s report was excluded because it substantially duplicated the admissible portfolio evidence.
4. The court emphasised the duty of parties and the court to prevent large commercial disputes becoming submerged in unnecessary expert material. The court should firmly reject evidence that is not reasonably required to resolve the proceedings.
5. Damages application. The application to strike out paragraph 390(d) or obtain summary judgment under CPR 3.4(2)(a) and CPR 24.2 was not to be heard before trial. The appropriate valuation date depended on the investment objectives, subsequent events, refinancing restrictions, sales and maturities. A useful legal assessment of recoverable loss required findings of fact. The court applied the approach in Kuwait Airways Corporation v Iraqi Airways [2002] 2 AC 883 and Prima Vera v Allied Dunbar Assurance plc, where the relevant principles concerned value judgment and causation. The application was therefore deferred until after the trial began.

The judgment records that the action had previously been before the Court of Appeal on at least three interlocutory occasions, but gives no citations or details of those decisions.