New regime for trial witness statements does not change law on admissibility

The High Court has considered the new Practice Direction (PD) 57AC on trial witness statements, which applies to statements signed on or after 6 April 2021, and confirmed that it does not change the law on admissibility of evidence, including the circumstances in which a witness of fact is permitted to give opinion evidence: Mad Atelier International BV v Manes [2021] EWHC 1899 (Comm).

The judge noted that the new PD requires a trial witness statement to contain only: (i) evidence as to matters of fact that need to be proved at trial by witness evidence; and (ii) "the evidence as to such matters that the witness would be asked by the relevant party to give, and the witness would be allowed to give, in evidence in chief if they were called to give oral evidence at trial". In the judge's view, this makes it clear that a witness statement can include any evidence that a witness would be allowed to give if giving oral evidence in chief.

While the new PD provides that a trial witness statement should not include commentary on the documents or the evidence of other witnesses, the judge clearly did not consider the evidence in question here (as to business projections if a joint venture had not been brought to an end) to amount to such commentary. It was either itself factual evidence, or evidence of opinion given by those with knowledge of the facts and by reference to their factual evidence, and was therefore admissible.

The decision notes that the PD is "obviously valuable in addressing the wastage of costs incurred by the  provision of absurdly lengthy witness statements merely reciting the contents of the documentary disclosure and commenting on it". This was certainly one of the key aims of the PD - the other being to improve witness evidence by reducing the potential for a witness’s recollections to be influenced or overwritten by the process of taking the statement. A change to the law on admissibility of evidence was not among the aims of the PD, and this decision is helpful in confirming that it did not have this effect.

Background

The claimant and defendant entered into a joint venture agreement (JVA) to develop an international restaurant franchise. The claimant alleged that the defendant fraudulently induced it to enter into transactions which led to the termination of the JVA. The quantum of the claim, if successful, depended on an expert assessment of the likely profitability of restaurants that would have been operated under the JVA.

The defendant applied to strike out certain parts of the witness statements from the claimant's employees giving evidence as to the projected restaurants, and part of the claimant's expert report which relied on that evidence.

The defendant relied on certain authorities in which the courts had ruled out evidence from factual witnesses which comprised commentary on documents and facts which were not in their direct knowledge, and who (the court had found) were acting like expert witnesses giving opinion evidence (JD Wetherspoon Plc v Harris [2003] 1 WLR 3296 and Buckingham Homes Ltd v Rutter [2018] EWHC 3917 (Ch)). He also relied on the new PD 57AC, and in particular the provisions that: a trial witness statement must contain only "evidence as to matters of fact"; it should not "include commentary on other evidence in the case (either documents or the evidence of other witnesses)..."; and the court may strike out part or all of a statement where a party fails to comply with the relevant provisions.

Decision

The High Court (Sir Michael Burton GBE sitting as a High Court Judge) dismissed the application to strike out the evidence in question.

Unlike in Wetherspoon and Buckingham, in the present case there was provision for expert evidence, and the witnesses in question were not independent witnesses asked to look at the documents in the disclosure and provide a commentary on them, but themselves played relevant roles at the material time.

The judge agreed with the claimant's submissions that the new PD did not change the law as to admissibility of evidence or overrule the directions given by previous authorities as to what may be given in evidence. In particular:

• There was support in the authorities for hypothetical evidence as to what would or could have happened itself being evidence as to matters of fact, and hence falling within the PD.
• The PD makes it clear that, in addition to matters of fact, a witness statement can include evidence which a witness "would be allowed to give in evidence in chief if they were called to give oral evidence at trial". Therefore the test is one of admissibility at trial.
• Reference in witness statements to documents does not necessarily amount to "commentary".
• The sanctions provided for in the PD are in any event discretionary.

The judge commented that the PD is "obviously valuable in addressing the wastage of costs incurred by the  provision of absurdly lengthy witness statements merely reciting the contents of the documentary disclosure and commenting on it". But it was not intended to affect the issue of admissibility.

The judge noted that s.3(2) of the Civil Evidence Act 1972 confirms that there is no blanket rule that witnesses who are not independent experts cannot give opinion evidence. There are various examples in the authorities of factual witnesses giving opinion evidence which relates to the factual evidence which they give, particularly if they have relevant experience or knowledge. This includes where the evidence is as to a hypothetical situation regarding what would or could have happened. The judge rejected the defendant's submission that the ability to give evidence of this sort is limited to evidence as to what the witness, or possibly their company, could or would have done.

The judge said he was fortified in his view that the claimant's evidence was admissible by various points including:

• The claimant would inevitably have given instructions to its expert as to what it considered would have happened, and those instructions would have been incorporated into and addressed by the expert in his report. By setting out that same information in witness statements, there was much greater transparency and it enabled the defendant's counsel to cross-examine the witnesses on this evidence.
• It was common ground that documents setting out projections or forecasts would have been admissible. While it may be argued that oral evidence to the same effect may be less reliable, the judge could see no difference in principle.

The judge concluded that the evidence in question was either itself factual evidence, or evidence of opinion given by those with knowledge of the facts and by reference to their factual evidence. It was therefore admissible.