In the recent judgment of McKinney Plant & Safety Ltd v Construction Industry Training Board,(1) The High Court reiterated the importance of compliance with Practice Direction 57AC (PD57AC), which applies to witness statements in commercial and property courts. The Court has determined, due to one party’s serious non-compliance, as well as their refusal to engage on the matter until the Court proactively intervenes, that costs should be awarded on a compensation basis.
During the ongoing proceedings, the Defendant challenged a supplemental witness statement served by the Plaintiff and argued that it failed to comply with the provisions of PD57AC in several material respects. The Plaintiff initially dismissed the Respondent’s concerns and argued that the Respondent’s criticism of the witness statement amounted to “nitching”.
The witness statement was then reviewed by the Court as part of a pre-trial review (PTR) and, in light of the judge’s serious concerns about the witness statement’s compliance with PD57AC, the parties were granted the order to exchange written submissions, with the judge pointing out that when plaintiff’s attorney had signed a certificate of compliance under PD57AC, it was primarily up to him to explain why he considered the witness statement to be in compliance with PD57AC.
By intervening in the PTR in this way, rather than leaving PD57AC compliance issues to the discretion of the trial judge, the judge explained that although he was aware of the need to avoid satellite litigation useless, “the very purpose of the PD57AC is to avoid the situation where the trial judge must separate the wheat of the proceedings from the chaff of the testimonies”. It was therefore appropriate to deal with the question at this stage of the proceedings, in particular when a protracted debate regarding the testimony of witnesses could have affected the apparently tight schedule of the trial.
Plaintiff’s written submissions acknowledged significant non-compliance with PD57AC (proposing changes to 95 of the 102 paragraphs of the witness statement) and, shortly thereafter, Plaintiff purported to serve an amended version of the witness statement reflecting these comments. In response, the Defendant argued that the amended witness statement still did not comply with PD57AC and, in addition, sought its costs on an indemnity basis.
It was for the Court to determine whether the plaintiff should be granted leave to serve and rely on the amended witness statement and what the appropriate costs order should be.
Analysis of PD57AC
During his judgment, the judge summarized the aspects of the witness statement that violated PD57AC, noting that:
- the witness statement contained lengthy comments giving the witness’s opinion on other evidence that was not available to him at the time of the events giving rise to the dispute;
- the witness statement contained narrative comments on documents that the witness may have seen at the time of the relevant events;
- the witness statement contained detailed observations;
- the witness statement criticized the defendant’s witnesses, alleged deficiencies in its disclosure and suggested that further disclosure would be sought;
- the witness statement frequently failed to identify the documents with any specificity and to provide a list of the documents mentioned or reviewed by the witness when preparing the statement; and
- confirmations of PD57AC compliance from the witness and relevant legal representative were not given until two weeks after the statement was signed.
The amended version of the witness statement made very substantial changes, with the judge ultimately determining that, subject to an important requirement explained below, the plaintiff should be permitted to serve and rely on the witness statement modified. Although the judge could see why the defendant still believed that the amended witness statement contained inadmissible comments about other evidence in the proceedings, he felt that this would require analysis by reference to that other evidence and that Such an analysis was best undertaken by the trial judge, rather than on the papers.
However, although the amended witness statement resolved many issues with the original version, it still did not include a list of the documents the witness referred to or reviewed when preparing his statement (as required by the paragraph 3.2 of PD57AC) . Accordingly, as a condition precedent to allowing the plaintiff to serve the amended witness statement, the judge ordered the plaintiff to provide such a list of documents, emphasizing that it was not an answer for the plaintiff to say that the defendant could identify the documents were referenced from the text of the statement itself because:
- documents were sometimes referred to in general terms, so that a specific document was not always identifiable; and
- a witness statement may not always refer to all the documents the witness reviewed when preparing it.
Procedurally, the judge determined that, although the plaintiff was not permitted to serve the amended witness statement, no separate application by the plaintiff for a waiver of penalties was required. In PD57AC claims, the objecting party would typically seek to exclude or limit the evidence found to be non-compliant with the PD57AC and, in determining such claims, the Court could decide what procedural steps are necessary to remedy. to any violation, rather than requiring a separate request for relief from penalties.
Compensation costs awarded
The court ordered the plaintiff to pay the defendant’s costs on the basis of compensation. In reaching this decision, the Court considered the following factors:
- The breach of PD57AC was serious, with the overwhelming majority of the original witness statement needing to be deleted or changed.
- The Claimant had not responded to the Respondent’s objections until very shortly before the PTR, which precluded a meaningful discussion.
- The position was aggravated by the plaintiff’s dismissive approach, with the plaintiff’s allegation that the defendant was finicky described as “obviously untrue”.
Given the extent to which the statement of the witness in question violated the provisions of PD57AC, as well as the plaintiff’s initial failure to engage, the judge’s findings are perhaps unsurprising.
The judgment demonstrates that, while the Court remains concerned to prevent PD57AC from giving rise to unnecessary satellite disputes or being used as a tactical weapon, “these concerns do not give carte blanche to non-compliance with the rules” and the Court remains ready to intervene (in this case, proactively) in the event of serious non-compliance. This underscores the importance of ensuring that witness statements comply with PD57AC and the potential consequences of not doing so.
For more information on this subject, please contact Tim Potts or Matthew Evans from RPC by phone (+44 20 3060 6000) or email ([email protected] or Matthew[email protected]). RPC’s website can be accessed at www.rpc.co.uk.
(1)  EWHC 2361 (Ch).