The impact of new approaches to Expert Evidence
Chartered Business Valuators weigh in on what works
In recent years, demands for lower litigation costs and shorter trials brought about new approaches to how expert evidence is prepared and presented. These approaches include concurrent evidence, jointly appointed experts and joint expert statements. Done right, they can promote settlement, streamline trials, reduce court backlogs, and make better use of expert time (“Reforming Expert Evidence”).
So as these approaches are put to use in Canada, which is proving to work the best?
The Canadian Institute of Chartered Business Valuators (CICBV) set out to answer that question, given that Chartered Business Valuators (CBVs) are frequently called upon to provide professional opinion and expert testimony. Specifically, CBVs provide evidence regarding financial matters such as the quantification of business value, intangible asset value, and damages, which is used by the courts as a basis for judicial decisions on financial matters.
Earlier this year, the CICBV conducted a national survey of its 1,600 members to better understand the impact these approaches are having and explore which approach is used most often. The survey also shed light on alternative versus traditional approaches to presenting expert evidence. Here is a summary of CICBV’s survey findings:
Concurrent evidence (sometimes referred to as hot tubbing) refers to the requirement that experts simultaneously present their evidence. At trial, the experts are examined and cross-examined together with questions formulated by counsel and/or the trier of fact.
The use of concurrent evidence is a relatively new practice in Canada. Only 20% of CBVs surveyed had presented evidence as part of a concurrent evidence format.
The survey respondents who had experience presenting in a concurrent evidence format reported mixed reviews:
approximately a third of respondents reported that using concurrent evidence resulted in lower costs for their clients, while a third reported that it resulted in higher costs and a third did not know;
69% reported that concurrent evidence was more efficient at narrowing the issues at trial than the traditional approach; and
56% of respondents reported an overall positive experience with concurrent evidence, while almost a third of respondents reported an overall negative experience.
According to one respondent, Vimal Kotecha, CBV, “Concurrent evidence is helpful in narrowing the issues to the main points of difference between the experts and it allows the trier of fact to focus on the key issues. It is only slowly being adopted in domestic disputes; I have seen it used primarily in international arbitrations.”
Joint expert statements
Joint expert statements involve experts who individually prepare their own reports and, prior to trial, prepare a joint statement about the areas of agreement and disagreement.
One third of respondents reported having worked with opposing experts to provide joint expert statements in court. Generally, respondents with experience preparing joint statements reported positive reviews for this approach:
52% of respondents felt that the use of joint expert statements resulted in a cost reduction for clients;
73% of respondents felt this method was more efficient at narrowing the issues at trial than traditional evidence; and
69% of respondents reported an overall positive experience with providing joint expert statements.
One respondent described a positive experience where “the judge ordered that the financial experts meet and provide a joint statement to the court regarding areas of agreement and disagreement, then outline those points of disagreement. The big advantage to this approach was that subsequent to providing the joint statement, the parties settled prior to commencement of the trial.”
Jointly retained experts
Jointly retained experts are appointed either by the court or mutually agreed upon by both parties.
The joint retainer of an expert was found to be the most frequently used of the three approaches - more than half of members surveyed (58%) reported having been jointly retained or been a court appointed expert in a litigation setting.
Respondents with experience with joint retainers reported more positive reviews for joint retainer engagements than the other alternative approaches:
60% of the respondents reported that joint retainers were more cost effective for clients than the traditional approach to evidence;
69% of respondents felt this method was more efficient at narrowing the issues at trial than traditional evidence; and
Interestingly, only 45% of respondents reported an overall positive experience with joint retainer engagements.
Some of the respondents reported a number of challenges faced by experts who are engaged jointly, including difficulty with managing the parties’ expectations and frustration on the part of the expert in having to manage conflicting instructions from each party.
According to one respondent, Catherine Tremblay, CBV, “Joint retainers can be extremely difficult when the parties submit different assumptions and perspectives on the situation, requiring the expert to effectively ‘be the judge’ when rendering an opinion”. However, another respondent, Gordon Krofchick, CBV, noted that it can be “an efficient process if both parties have reasonable expectations, and communication and the role of the expert are well defined before the engagement.”
The mixed reviews from CBVs on alternate approaches to expert evidence is not surprising. Clearly one size does not fit all. However, based on the survey results, jointly retained experts is emerging as the most widely used of the alternative approaches for cases involving business valuation and damages quantification.
Counsel and the courts will continue to explore ways of presenting expert evidence more effectively and at a lower cost than the traditional approach. Experts like Chartered Business Valuators recognize the need for this evolution of processes and for a dialogue to explore best practices as part of this evolution.
Suzanne Loomer is a Chartered Business Valuator, member of the Canadian Institute of Chartered Business Valuators (CICBV) and Managing Director of Froese Forensic Partners Ltd. (firstname.lastname@example.org, 416-926-4216).
The CICBV is a professional association that establishes practice standards, educational requirements and ethical guidelines, which promote the integrity of the Chartered Business Valuator (CBV) profession in Canada. The CBV designation is the premier credential for professional business valuators and litigation support advisors in Canada.