British Airways Plc v Spencer & Ors (Trustees of the Airways Pension Scheme)

Under Civil Procedure Rules 1998, r 35.1, expert evidence must be assessed against each pleaded issue unless that issue has been excluded from the case. Evidence necessary to resolve an issue should be admitted. Evidence which is only helpful requires a further proportionality assessment in the context of the proceedings as a whole.

That assessment may include the value and consequences of the claim, cost, delay, the trial timetable, and whether a carefully confined order can avoid unfairly restricting the trial judge. A blanket refusal is flawed where it does not adequately address the distinct pleaded issues on which technical evidence may assist.

The appellant challenged decisions of the trustees of an occupational pension scheme to amend the scheme rules and grant discretionary pension increases. It alleged, among other matters, predetermination, improper purpose, irrationality, failure to follow or obtain proper advice, and defects in the actuarial methodology used.

Deputy Master Cousins refused permission for expert actuarial evidence on the basis that none was necessary. The appellant appealed that case-management decision. The central issue was whether, and to what extent, actuarial evidence was reasonably required to resolve the pleaded issues under Civil Procedure Rules 1998, r 35.1.

1. Appeal allowed. The Deputy Master’s wholesale refusal of expert evidence was set aside. His exercise of discretion was flawed because he did not adequately consider the distinct pleaded issues and instead approached the matter at too high a level of generality.

2. Under Civil Procedure Rules 1998, r 35.1, the court should first ask, issue by issue, whether expert evidence is necessary to resolve the issue. If it is necessary, it should be admitted unless the issue itself is struck out or excluded. If it is not necessary, the court should ask whether it would assist; if so, it must decide whether it is reasonably required to resolve the proceedings as a whole.

3. The latter assessment is not one of absolute necessity. It requires a practical and proportionate judgment. Relevant matters include the value and effect of the claim, the parties’ exposure to costs, delay, any risk to the trial date, the ability to define the evidence precisely, and the undesirability of unnecessarily tying the trial judge’s hands.

4. Some pleaded disputes required or could materially benefit from actuarial evidence, including the appropriateness and prudence of actuarial methodologies, the interaction of funding and de-risking objectives, scenario testing, ordinary funding principles, and a discrete rounding issue. Evidence was not justified merely to explain documents intelligible to the court, establish what advice had in fact been given, or prove the trustees’ state of mind.

5. On re-exercising the discretion, the court permitted suitably circumscribed expert evidence. The order was to prevent a roving inquiry, allow sequential reports, and remain capable of variation or curtailment if the evidence proved overlong or tangential. The parties were invited to agree the scope and timetable, while proceeding promptly with preparation.

• High Court (Chancery Division): allowed the appellant’s appeal from the Deputy Master’s case-management order refusing expert evidence, set that decision aside, and re-exercised the discretion under Civil Procedure Rules 1998, r 35.1.
• Chancery Division, Deputy Master Cousins: by an order dated 27 April 2015, refused permission to call or rely on expert evidence on the basis that none was necessary.