How the White Burgess v. Abbott decision impacts expert retainers

When a party retains a consultant in a context where they might, in the future, want that same consultant to be used as an expert witness in litigation, there has always been a risk that the consultant would be disqualified to give opinion evidence in court.

The Supreme Court of Canada issued a decision in 2015 confirming that even if an expert was involved in the background of the dispute between parties, that expert should be accepted as an expert unless there is a realistic overriding concern about their independence and impartiality.

This is an important decision for businesses that regularly handle claims and complaints, and in particular, insurance providers that have claims personnel. Professionals in this field should feel comfortable using the best available consultant in any circumstance, as long as the consultant is working independently and impartially. Since a consultant can later be used as an expert, the business retaining that consultant should ensure that communications acknowledge and address the consultant’s independence and impartiality in performing work throughout the process.

Executive Summary

When a party retains a consultant in a context where they might, in the future, want that same consultant to be used as an expert witness in litigation, there has always been a risk that the consultant would be disqualified to give opinion evidence in court. The Supreme Court of Canada issued a decision in 2015 confirming that even if an expert was involved in the background of the dispute between parties, that expert should be accepted as an expert unless there is a realistic overriding concern about their independence and impartiality. This is an important decision for businesses that regularly handle claims and complaints. Professionals in this field should feel comfortable using the best available consultant in any circumstance, as long as the consultant is working independently and impartially. Since a consultant can later be used as an expert, the business retaining that consultant should ensure that communications acknowledge and address the consultant’s independence and impartiality in performing work throughout the process.

The Context: Retaining an expert under the shadow of an unlikely trial

Throughout most of the world, a trial before a judge is, theoretically, the lawful method of resolving a civil dispute. Civil disputes can be resolved by judges, but in practice, it is the Rules of Court and the process of proceeding towards trial that forges resolutions.

At trial, a judge’s preference for one expert over another is often the key to a party’s success. Therefore, in negotiations leading up to trial, an expert report will be a compelling negotiation tool. Negotiation, positioning, and pre-trial persuasion will be based upon how an opposing party thinks a judge will treat a report. It is important to have a good expert, but it is just as important that your best expert is positioned to give evidence at a trial. This requires compliance with tricky court rules and procedures applicable to expert evidence at trial.

The Challenge

Lawyers spend significant time at trial challenging the experts that their opponents have retained. These challenges put at issue the relevance, necessity and qualification of experts, or attempt to exclude expert evidence for technical reasons.

A common challenge is the limited amount of experts in a given field. For example, often the best construction experts are the contractors and consultants that an owner would want to use to remediate a problem. Where an expert has performed inspection or remediation work on the subject of a construction lawsuit, opposing counsel may attempt to disqualify or devalue the evidence by accusing the expert of bias or partiality. For example: “You were paid how much to inspect? And your inspection concluded that repairs were needed? And you were paid how much to oversee the repairs? And now you are relying on your own expertise to justify your client’s decision to retain you and pay you all of this money?”

Previously, where the independence of an expert was challenged, courts were divided on the effect of the challenge:

• Was it exclusively a question of weight? Weight represents how much value the court assigns to the expert’s evidence.
• Was it was also an issue of admissibility? Admissibility is a question of whether the court will actually accept and consider an expert’s evidence.

This uncertainty of the law created a problem: since there are a finite number of good experts, counsel were often forced to pick an inferior construction consultant and save their better expert for a potential trial. Given the relative rarity of trials (in comparison to the number of lawsuits started), saving the best expert for the unlikely trial seems to waste a valuable resource.

Clarity from the Supreme Court of Canada

The Supreme Court of Canada has brought some clarity to this area with its recent decision in White Burgess Langille Inman v. Abbott and Haliburton Co., 2015 SCC 23. In White Burgess v. Abbott, a company switched auditors, bringing in a new accounting firm to provide services. The new accounting firm discovered problems with the former auditors’ work, and the shareholders sued the former auditors for professional negligence.

The shareholders retained an expert witness who was a partner from a different office of the new accounting firm, and the former auditors challenged the admissibility of that expert’s evidence. The former auditors claimed that the expert was not impartial, since her firm could be exposed to liability if her approach was not accepted, and that as a partner, she could be personally liable. The auditors claimed that this personal financial interest in the outcome of the litigation should disqualify her from testifying.

The Supreme Court of Canada ruled that this was a question of whether the expert evidence was admissible, since a challenge of bias or partiality regarding an expert properly falls under the question of whether the expert is properly qualified.

The Court identified the widely held principle that expert witnesses owe a primary duty to the court be fair, objective and non-partisan. This duty overrides the expert’s obligation to the party that retained them and called them as a witness, and if they are unable or unwilling to fulfill that duty, they do not qualify to perform the role of an expert.

The expert must attest or testify under oath that they understand and accept their duty to the court. In British Columbia, an expert report must include a written certification of the expert’s cognizance of their duty to the court. Once this is done, in order to put the expert’s bias or partiality at issue, the party opposing the admission of the evidence must show there is a realistic concern that the expert is unable and/or unwilling to comply with that duty. If there is a realistic concern shown, then the party calling the witness will have the opportunity to prove, on a balance of probabilities, that the expert is independent and impartial. The test is whether or not the expert’s opinion would change regardless of which party retained them. As long as an expert is properly instructed, it will be rare for a proposed expert’s evidence to be ruled inadmissible for failing to meet that threshold.

In White Burgess v. Abbott, the expert’s evidence was admitted, and the following important observations were noted in the Supreme Court of Canada’s written decision:

• The fact that an employee of a professional firm discovered what they thought was professional negligence does not disqualify them from offering that opinion as an expert witness. As long as the initial work is independent and impartial, and the expert is able to comply with the duty to provide fair, objective and non-partisan assistance to the court, the threshold qualification will be met;
• An expert does not lack the threshold qualification simply because they rely on the work of other professionals in reaching an opinion.

It is only in clear cases that the threshold will not be met. Some examples include:

• where the expert has a direct financial interest in the outcome of the litigation;
• where the expert has a close familial relationship with a party;
• where the expert will be exposed to professional liability if his or her opinion is not accepted by the court; and
• where the expert assumes the role of an advocate for a party and is clearly unwilling and/or unable to carry out the primary duty to the court.

Short of this level of impartiality, an expert’s evidence should be admitted.

Free and Clear?

The threshold for admitting expert evidence in White Burgess v. Abbott is not the end of the inquiry. If there are lurking questions of impartiality and bias, this will affect the weight of an expert’s evidence. A judge’s preference for one expert over another may come down to some of the human factors on the witness stand, such as defensiveness and antagonism, which imply bias or tarnish credibility.

What does this mean for insurance claim handlers?

An insurance claim handler should feel comfortable using the best available consultant in any circumstance. There is no need to save an expert for trial. However, with the potential that a consultant could end up as an expert witness, it is more important than ever that the consultant works independently and impartially. Considering the duty of utmost good faith on insurance providers, this requirement is not new, but the importance is heightened when a consultant may later be used as an expert witness.

A claims handler’s correspondence to a consultant has the potential to severely hinder that consultant’s utility as an expert down the road. A claims handler should be hyper-sensitive to any communications that may suggest influence over the conclusions that a consultant reaches. A claims handler should appreciate that their consultant may be cross-examined. A fact witness may be involved with some documents in a case. An expert is required to produce an entire correspondence file including correspondence that is normally protected by privilege. When communicating with a consultant, a claims adjuster must be continually aware that if the claim is litigated, internal communications will be disclosed, and any questionable correspondence becomes ammunition for the opposing parties to challenge your expert. Witty email banter is far too easy to send, and can become a gold mine for opposing counsel conducting a cross-examination.

Although White Burgess v. Abbott seems to relax the rules about trial experts, easier access to experts comes with greater responsibility. Any time an external consultant is retained, the party hiring the consultant ought to consider the worst-case (and admittedly unlikely) scenario of a trial, and govern all decisions and correspondence accordingly.