Warner Retail Ltd v National Westminster Bank

Applications to adduce expert evidence and to adjourn a fixed trial should be determined under the overriding objective in Civil Procedure Rules 1998, including the need for proportionate cost, expedition, fairness, equality of arms and appropriate use of court resources. The absence of a specific deadline does not entitle a party to make an application shortly before trial without satisfactory explanation. In interest-rate-swap mis-selling litigation, expert evidence may assist on industry practice and product suitability, but it is not automatically required. A late application may therefore be refused where the resulting adjournment would cause substantial expense, prejudice and disruption, particularly when the issues were apparent much earlier.

Warner Retail Ltd brought a claim against National Westminster Bank and Royal Bank of Scotland alleging negligent advice, breach of contract and reliance on regulatory standards in the sale of bank-cancellable interest-rate swaps. The claimant sought permission to adduce expert evidence concerning the products, the appropriate sales process, suitability, alternative products and quantum.

The application was made shortly before a five-day trial. The claimant accepted that permission would require the trial to be adjourned. The central issues were whether expert evidence would assist the court and, if so, whether the lateness of the application justified refusing permission and the requested adjournment.

1. Applications and governing principles. The applications for permission to adduce expert evidence under Civil Procedure Rules 1998, rule 35.4, and to adjourn under rule 3.1(ii)(b) were governed by the overriding objective in rule 1(i). It was unnecessary to decide how far the relief-from-sanctions principles in Mitchell applied.
2. Expert evidence. Expert evidence can assist in an interest-rate-swap mis-selling case by explaining industry practice, product characteristics and suitability. It is not, however, necessary in every such case. The parties could prepare a non-contentious description of the products, and the claimant could instruct an expert privately to assist with cross-examination.
3. Late application. Although no specific deadline had been imposed for applying under rule 35, the claimant had contemplated expert evidence from the outset and had delayed without good reason. The absence of a formal breach did not prevent the court from considering the delay and the need to enforce procedural discipline as part of the overriding objective.
4. Balancing factors. Equality of arms favoured permission to some extent, because the bank manager had relevant product knowledge. The other factors strongly favoured refusal: an adjournment would cause considerable expense, prejudice the defendants and their witnesses, disrupt the court’s list and affect other court users. The claimant had not shown that it could not present its case fairly without expert evidence.
5. The application for permission to adduce expert evidence and the application to adjourn the trial were dismissed.