Category: Evidence

Pre-action conduct and committal – a “practice note”

In Jet 2 Holidays Ltd v Hughes [2020] 1 WLR 844 the Court of Appeal held that:

  1. CPR r 32.14, the provision which provides for committal proceedings against a person if they make, or cause to be made, a false statement in a document verified by a statement of truth without an honest belief in its truth, did not confer jurisdiction to bring committal proceedings in respect of a witness statement that had been made before the commencement of proceedings.
  2. However, if a statement made before the commencement of proceedings interfered with the due administration of justice the court would be able to exercise its inherent power to commit for contempt in respect of it.
  3. Since pre-action protocols were now an integral and highly important part of litigation architecture, a dishonest witness statement made before the commencement of proceedings in purported compliance with a pre-action protocol was capable of interfering with the due administration of justice, even though, following a challenge by the prospective defendant to the truth of the statement, proceedings for substantive relief were never issued.
  4. The witness statements in the present case were closely connected to the administration of justice and, if false, interfered with it, thus giving rise to jurisdiction to commit the defendants for contempt.
  5. However, on a true construction of CPR r 81.13(2) , the witness statements had been made “otherwise than in connection with any proceedings”, which phrase referred to proceedings commenced before the contempt was committed.
  6. Therefore, the application for permission to make a committal application should have been made to the Administrative Court, but that procedural defect would be waived, pursuant to paragraph 16.2 of CPR Practice Direction 81, and permission would be granted.
  7. That, further, since the new witness statements fell within CPR r 32.14 and there was a clear public interest in the bringing of contempt proceedings in respect of them, the claimant would be granted permission to amend its claim form to add the new grounds of contempt.

In the judgment of the court it was said:

“50. It is not satisfactory that false statements made in witness statements served before the commencement of proceedings in purported compliance with a PAP fall outside CPR r 32.14 . Nor is it satisfactory or convenient that any application for permission to bring contempt proceedings for such false statements must always be made to the Administrative Court pursuant to CPR r 81.13(2) . It is highly desirable, therefore, that the possibility of contempt in relation to such statements should be expressly addressed in the Civil Procedure Rules and a practice direction.”

A few months later, on the 16 July 2020, the 122nd amendment to the CPR was produced and included an amendment to the Practice Direction: Pre-Action Conduct and Protocols with effect from 1 October 2020:

“In paragraph 2, at the end insert “A person who knowingly makes a false statement in a pre-action protocol letter or other document prepared in anticipation of legal proceedings may be subject to proceedings for contempt of court.”.”

Pre-action letters are important in sub-letting, allocation fraud, etc cases where a possession claim or other proceedings are being contemplated and are usually expressly made pursuant to Part 3 of the Pre-action Protocol for Possession Claims by Social Landlords.

This may appear to take them outside of the amended Practice Direction, which says at paragraph 2:

“This Practice Direction applies to disputes where no pre-action protocol approved by the Master of the Rolls applies.”

but a proper reading of this practice direction must rather demonstrate that the amendment will apply even if a pre-action protocol operates.

It follows that it would be good practice from 1 October 2020 to include a warning in pre-action correspondence that false statements may lead to contempt proceedings.

Excluding all or part of a witness statement

Introduction

There appears to have been the beginnings of a trend in housing possession cases recently for defendants to challenge the admissibility of all or part of the claimant’s witness statement evidence by way of an application under CPR r. 32.1 to exclude all or part of witness evidence filed on behalf of the claimant:

“(2) The court may use its power under this rule to exclude evidence that would otherwise be admissible.”

Correspondingly and in terms of form, paragraph 25 of the Practice Direction to CPR r.32 provides at paragraph 1:

“Where:

(1) an affidavit,

(2) a witness statement, or

(3) an exhibit to either an affidavit or a witness statement,

does not comply with Part 32 or this practice direction in relation to its form, the court may refuse to admit it as evidence and may refuse to allow the costs arising from its preparation.” (emphasis added).

This article seeks to explain the basis and general merit of such exclusion applications. and possible and appropriate responses by the landlord respondent.

 

The Issue

A common starting point is the judgment of the (now) Master of the Rolls (then Chancellor) in JD Wetherspoon Plc v Harris and others [2013] EWHC 1088 (Ch); [2013] 1 WLR 3296 where he confirmed that a witness statement should cover only those issues upon which the party serving it wishes that witness to give evidence-in-chief.  That, as a broad statement of principle, is uncontroversial.

He went on to stress that it was not the function of a witness statement:

  • to provide a commentary on the documents in the trial bundle,
  • to set out quotations from such documents,
  • to engage in matters of argument or
  • to deal with other matters merely because they arise in the course of the trial.

And so at paragraph 39 of his judgment he said:

“Mr Goldberger would not be allowed at trial to give oral evidence which merely recites the relevant events, of which he does not have direct knowledge, by reference to documents he has read. Nor would he be permitted at trial to advance arguments and make submissions which might be expected of an advocate rather than a witness of fact. These points are made clear in paragraph 7 of Appendix 9 to the Chancery Guide (7th ed), which is as follows:

“A witness statement should simply cover those issues, but only those issues, on which the party serving the statement wishes that witness to give evidence in chief.  Thus it is not, for example, the function of a witness statement to provide a commentary on the documents in the trial bundle, nor to set out quotations from such documents, nor to engage in matters of argument.  Witness statements should not deal with other matters merely because they may arise in the course of the trial.””

With regard to the reference to the Chancery Guide, which though it has no direct application of course to trials in the County Court accurately records the principles applicable to such cases (save for the procedural aspects referred to in paragraph 19.5), the current version says this about witness statements:

‘19.1  CPR rule 32.4 describes a witness statement as “a written statement signed by a person which contains the evidence which that person would be allowed to give orally”.

19.2  The function of a witness statement is to set out in writing the evidence in chief of the maker of the statement. Accordingly witness statements should, so far as possible, be expressed in the witness’s own words. This guideline applies unless the perception or recollection of the witness of the events in question is not in issue.

19.3  A witness statement should simply cover those issues, but only those issues, on which the party serving the statement wishes that witness to give evidence in chief. It should therefore be confined to facts of which the witness can give evidence. It is not, for example, the function of a witness statement to provide a commentary on the documents in the trial bundle, nor to set out quotations from such documents, nor to engage in matters of argument, expressions of opinion or submissions about the issues, nor to make observations about the evidence of other witnesses. Witness statements should not deal with other matters merely because they may arise in the course of the trial.

19.4  Witness statements should be as concise as the circumstances of the case allow. They should be written in consecutively numbered paragraphs. They should present the evidence in an orderly and readily comprehensible manner. They must be signed by the witness, and contain a statement that he or she believes that the facts stated in his or her witness statement are true. They must indicate which of the statements made are made from the witness’s own knowledge and which are made on information and belief, givingthe source of the information or basis for the belief.

19.5  Inadmissible material should not be included. Irrelevant material should likewise not be included. Any party on whom a witness statement is served who objects to the relevance or admissibility of material contained in a witness statement should notify the other party of their objection within 28 days after service of the witness statement in question and the parties concerned should attempt to resolve the matter as soon as possible. If it is not possible to resolve the matter, the party who objects should make an appropriate application, normally at the pre-trial review (“PTR”), if there is one, or otherwise at trial.”

 

Reference to the Civil Procedure Rules demonstrates that these are just part of the basis for establishing a “proper” witness statement.  And so CPR r. 32.8 simply provides:

“A witness statement must comply with the requirements set out in Practice Direction 32.”

Practice Direction 32 (paragraphs 17 to 25) set out these requirements and in terms of statements’ contents simply and in essence provides that:

  1. The statement must, if practicable, be in the intended witness’ own words (18.1).
  2. It should indicate which of the statements in it are made from the witness’s own knowledge and which are matters of information or belief, and the source for any matters of information or belief (18.2).

 

Purpose of Witness Statements

Any party will at a civil trial seek to prove the necessary facts of their case by:

(a) Witnesses giving oral evidence – see CPR r.32.2(1);

(b) Hearsay Evidence, such as witness statements where the maker does not attend trial to be cross-examined – see the Civil Evidence Act 1995, s. 1 and CPR r. 32.5(5)(b) and r. 33.2 – though there are issues of weight); and/or

(c) Relevant documents – see paragraphs 11.3 to 15.4, and 18.5 of the Practice Direction to CPR r. 32.  Note however the admissibility in any event of agreed documents:

“27.2  All documents contained in bundles which have been agreed for use at a hearing shall be admissible at that hearing as evidence of their contents, unless –

(1) the court orders otherwise; or

(2) a party gives written notice of objection to the admissibility of particular documents.”

Evidence at such a civil trial, including possession claims brought by local housing authorities and private registered providers of social housing, will therefore of course be greatly underpinned by a witness statement from each live witness served in accordance with earlier court directions.  CPR r. 32.4 accordingly says:

“(2) The court will order a party to serve on the other parties any witness statement of the oral evidence which the party serving the statement intends to rely on in relation to any issues of fact to be decided at the trial.”

Additional questions in chief put by a party to its witness maybe allowed by the trial judge – see CPR r. 32.5(3)(4) – but the starting point is that:

32.5(2) Where a witness is called to give oral evidence under paragraph (1), his witness statement shall stand as his evidence in chief unless the court orders otherwise.

The importance, therefore, of the witness statement is obvious and its exclusion, even in part, could fatally, or at least substantially, undermine a party’s case and leave it without evidence of essential facts.

 

Landlord’s response to application

CPR r. 32 and Practice Direction

Civil Evidence Act 1995

There is nothing objectionable to any party insisting upon strict adherence to the court rules and established practices as and when appropriate.

For example, witness statements showing (in part) a remarkable resemblance to skeleton arguments are not uncommon and should be rightly criticised.  I recently acted for the landlord in a residential possession trial (mandatory ground) where the defendant included in his own evidence, and that of others supporting him, irrelevant information on alleged poor management practice by the landlord which had no bearing on his sole defence of proprietary estoppel.

Whether there is subsequently a need or tactical imperative to formally apply to exclude all or part of such evidence, as opposed to making submissions to like effect (as I did in the proprietary estoppel trial), is a moot point however.

One example of where the application route was adopted, in addition to the Wetherspoon case, is Akhtar v Muhammad [2002] EWHC 673 (Ch) where the court held that it was appropriate to allow, in part, an application by the defendant for the exclusion of certain passages contained in the claimant’s witness statement on the basis that they were likely to cause a proliferation of issues at trial.

However, the Master of the Rolls in Wetherspoon went on to “warn” against a too literal approach to the relevant rules and principles:

“41…these rules as to witness statements and their contents are not rigid statutes. It is conceivable that in particular circumstances they may properly be relaxed in order to achieve the Overriding Objective in CPR r.1 of dealing with cases justly”.

Further, it should be borne in mind:

  1. A clear and agreed list of issues (or one set down by the court in the absence of agreement – see CPR r. 3.1(2)(k) and r. 32(1)(a)/32.2(3)), or the limitation of cross examination for the same reasons (CPR r. 32.1(3)), should in many instances effectively sideline any unnecessary and inappropriate information contained in the statement objected to.
  2. Such elements only really have any relevance in so far as they risk derailing the trial timetable and/or prejudicing the fair conduct of the trial.
  3. There can of course be agreement to remove certain parts of a statement or a whole statement (presumably not only where appropriate, but where the factual elements of the claim can still be proved).
  4. Hearsay evidence is, as already noted, admissible in civil trials and therefore a statement recording the evidence relied upon by the claimant is not properly to be treated as just a “commentary on the documents in the trial bundle” but something the claimant wishes to give evidence in chief on (even if hearsay).
  5. Proper regard has to be had to the overriding objective:

“1.1

(1) These Rules are a new procedural code with the overriding objective of enabling the court to deal with cases justly and at proportionate cost.

(2) Dealing with a case justly and at proportionate cost includes, so far as is practicable –

(a) ensuring that the parties are on an equal footing;

(b) saving expense;

(c) dealing with the case in ways which are proportionate –

(i) to the amount of money involved;

(ii) to the importance of the case;

(iii) to the complexity of the issues; and

(iv) to the financial position of each party;

(d) ensuring that it is dealt with expeditiously and fairly;

(e) allotting to it an appropriate share of the court’s resources, while taking into account the need to allot resources to other cases; and

(f) enforcing compliance with rules, practice directions and orders.”

Conclusion

It follows that any party considering making an application to exclude evidence, or the court considering the same, has to adopt a pragmatic approach. As Mr Justice Arnold said in Takeda Pharmaceutical Co. Ltd v Fougera Sweden Holding 2 AB [2017] EWHC 1995 (Ch)

“8. Fougera contends that large swathes of all four of these statements are inadmissible in evidence at this trial on one or more of the following grounds: (i) they contain statements of subjective intention in relation to the SPA and/or opinion and/or legal argument, (ii) they concern the negotiation of the SPA, (iii) they concern facts which were only available to one of the contracting parties and (iv) they concern the conduct of the parties after the SPA. Consistently with that contention, counsel for Fougera elected not to cross-examine any of the witnesses.

9. Takeda disputes that any parts of the statements are inadmissible. In order to reduce the ambit of the dispute, Takeda has elected not to rely upon some of paragraphs objected to by Fougera. Nevertheless, Takeda does rely upon a fairly large number of paragraphs in all four statements which are objected to. I do not propose to lengthen this judgment by considering each paragraph and each objection seriatim. I consider that, on the whole, Fougera’s objections are justified. Even if all the evidence relied on by Takeda were admitted, however, I do not consider that it would affect the conclusions which I have reached.”

It is certainly the case that witness statements need to be carefully drafted – they are not skeleton arguments and should only focus on the information the party needs to submit to prove its case (or successfully oppose the claim).  Where that does not involve direct evidence it should be clear how the deponent came by the information and why they are the one providing it.

For a landlord in a sub-letting possession claim therefore, by way of example, one would expect witness evidence – hearsay or otherwise – of:

  • the tenancy agreement;
  • service of the notice;
  • the (other) residence of the defendant (if known);
  • the details (and evidence) of the alleged sub-letting and how it was discovered;
  • the rent and the sub-letting rent for any rent/use and occupation/unlawful profit order claim;
  • compliance with the pre-action protocol;
  • (in a claim with an alternative breach of tenancy basis of possession, details of any relevant factual factors going towards reasonableness and any relevant policies).

Whatever the progress of the “trend” referred to at the beginning of this article, it will still be rare that witness evidence will be excluded, at least to the extent that the claim will be derailed.

 

Witnesses – Credibility and Probative Value

On Friday 3 August 2018 HHJ Simon Barker QC, sitting as a Deputy High Court Judge, handed down judgment in Saeed v Ibrahim [2018] EWHC 1804 (Ch).  The case concerned a claim for declarations, accounts or restitution or damages arising from property and other transactions involving some or all of the various parties.

Whilst the Claimants were ultimately successful, the interest of the case for this article’s purpose is the nature of the oral evidence heard by the court.  It is clear from the judgment that there were, perhaps not unusually serious issues arising from the oral evidence heard at trail.  That clearly had relevance to the case itself but also provides an opportunity to review certain of the issues and factors surrounding the use and selection of witnesses.  For example:

(a) Quality of Witness Statements

It should go without saying but frequently needs to be said that a person needs to understand and approve their statement in considered, clear and logical fashion, if only to avoid the conclusion HHJ Simon Barker QC reached here:

“12.  When giving his oral evidence, D1 spent some time making significant corrections to and clarifications of 10 of the 49 paragraphs of his main witness statement. Mr Ghaffar submitted that in their evidence his clients, that is D1 and D3 for this purpose (D1 purported to give evidence on behalf of D5), did their best to tell the truth but, Mr Ghaffar conceded, there were aspects of their evidence which were unsatisfactory.”

(b) Problems with Oral Evidence

Of course one can never entirely legislate for what a witness will say when called to give their evidence orally but “car crash” performances rarely if ever win the day:

13. …Mr Briggs submitted that D1 was an exceptionally evasive and unsatisfactory witness…D1 was unable to answer questions; other occasions when D1 launched into tangential speeches as answers; various occasions on which he blamed his solicitors for shortcomings (flaws in his witness statement, disclosure shortcomings including in relation to powers of attorney in his sons’ names, and inconsistencies between his pleaded case and his evidence). In addition, during cross-examination D1 admitted that C1 had indeed brought cash in a holdall or bag to his home, admitted the existence of documentation reflecting money transfers through AR to C1, and referred to meetings (initially one, then two, and finally three) with a lawyer about trust deeds. At one point in cross-examination, D1 referred to C1 having brought cash to him at his home “so many times” that he could not say whether or not he had done so on the occasion the subject of the question. From the outset of his oral evidence D1 appeared confident in his answers. He showed no signs of concern or embarrassment when challenged on his probity (e.g. why he failed to make income tax returns when he had annual rental income in the order of £50,000), his lack of concern about the accuracy of conveyancing documents to effect property transfers (e.g. the transfer of 37LR to D3 in October 2005), and when, as not infrequently happened, he was caught out in lies. When giving evidence about his means and access to money (two examples are the use of family members as nominee holders of accounts and the use and whereabouts of an advance inheritance of several hundred thousand pounds said to have been received from his father) D1 was persistently evasive. To describe D1 as an unimpressive witness would fall well short of the mark.”

The Claimant’s counsel had in this context referred to Painter v Hutchinson [2007] EWHC 758 (Ch) to support his attack on the First Defendant’s credibility, in particular paragraph 3 of the judgment of Mr Justice Lewison (as he then was):

“However, in addition to having been convicted of dishonesty in the past, Mr Hutchison was also a very unsatisfactory witness. Even Miss Rich did not suggest that his evidence was reliable. I will give detailed examples later, but for now I summarise my general impression. He was evasive and argumentative. He would launch into tangential speeches when confronted by questions that he could not answer consistently with his case. He attempted to place the most strained readings on the plain words of his pleaded case and his principal witness statement. He was free with allegations that his previous solicitors and counsel had made mistakes in accurately recording his instructions. At times he gave self-contradictory answers within the space of a few minutes of his evidence. New allegations emerged in the course of his cross-examination which had not previously formed part of his pleaded case or his written evidence. It was impossible not to conclude that they had been made up on the spot. In the course of his cross-examination of Mr Hutchison Mr Cowen convincingly demonstrated to my mind that Mr Hutchison’s case had shifted in important respects either in response to evidence given by Mr Painter or in response to documents that had emerged on disclosure. It changed again and again in the witness box itself. His disclosure of documents has been lamentable and highly selective. In my judgment he has deliberately and dishonestly fabricated evidence in order to try to accommodate what was indisputable within the overall framework of his story.”

(c) “Pointless” selection of witness

Sometimes no witness may be better than the one selected.  It is sufficient under this sub-heading to simply set out in full paragraph 17 of the Judgment:

“Mr Javed Qamar (‘JQ’) is a long-standing friend of C1 and, to some extent, a funder of C1 in this case. In closing submissions, Mr Briggs accepted that JQ’s evidence was partisan. I disregard his evidence.”

(d) Passage of time & recollection

Reference was made to the fascinating and apposite remarks of Mr Justice Leggatt (as he then was) in Gestmin SGPS SA v Credit Suisse (UK) Ltd [2013] EWHC 3560 (Comm), albeit with reference to commercial cases:

“15. An obvious difficulty which affects allegations and oral evidence based on recollection of events which occurred several years ago is the unreliability of human memory.
 
16. While everyone knows that memory is fallible, I do not believe that the legal system has sufficiently absorbed the lessons of a century of psychological research into the nature of memory and the unreliability of eyewitness testimony. One of the most important lessons of such research is that in everyday life we are not aware of the extent to which our own and other people’s memories are unreliable and believe our memories to be more faithful than they are. Two common (and related) errors are to suppose: (1) that the stronger and more vivid is our feeling or experience of recollection, the more likely the recollection is to be accurate; and (2) that the more confident another person is in their recollection, the more likely their recollection is to be accurate.
 
17. Underlying both these errors is a faulty model of memory as a mental record which is fixed at the time of experience of an event and then fades (more or less slowly) over time. In fact, psychological research has demonstrated that memories are fluid and malleable, being constantly rewritten whenever they are retrieved. This is true even of so-called ‘flashbulb’ memories, that is memories of experiencing or learning of a particularly shocking or traumatic event. (The very description ‘flashbulb’ memory is in fact misleading, reflecting as it does the misconception that memory operates like a camera or other device that makes a fixed record of an experience.) External information can intrude into a witness’s memory, as can his or her own thoughts and beliefs, and both can cause dramatic changes in recollection. Events can come to be recalled as memories which did not happen at all or which happened to someone else (referred to in the literature as a failure of source memory).
 
18. Memory is especially unreliable when it comes to recalling past beliefs. Our memories of past beliefs are revised to make them more consistent with our present beliefs. Studies have also shown that memory is particularly vulnerable to interference and alteration when a person is presented with new information or suggestions about an event in circumstances where his or her memory of it is already weak due to the passage of time.
 
19. The process of civil litigation itself subjects the memories of witnesses to powerful biases. The nature of litigation is such that witnesses often have a stake in a particular version of events. This is obvious where the witness is a party or has a tie of loyalty (such as an employment relationship) to a party to the proceedings. Other, more subtle influences include allegiances created by the process of preparing a witness statement and of coming to court to give evidence for one side in the dispute. A desire to assist, or at least not to prejudice, the party who has called the witness or that party’s lawyers, as well as a natural desire to give a good impression in a public forum, can be significant motivating forces.
 
20. Considerable interference with memory is also introduced in civil litigation by the procedure of preparing for trial. A witness is asked to make a statement, often (as in the present case) when a long time has already elapsed since the relevant events. The statement is usually drafted for the witness by a lawyer who is inevitably conscious of the significance for the issues in the case of what the witness does nor does not say. The statement is made after the witness’s memory has been “refreshed” by reading documents. The documents considered often include statements of case and other argumentative material as well as documents which the witness did not see at the time or which came into existence after the events which he or she is being asked to recall. The statement may go through several iterations before it is finalised. Then, usually months later, the witness will be asked to re-read his or her statement and review documents again before giving evidence in court. The effect of this process is to establish in the mind of the witness the matters recorded in his or her own statement and other written material, whether they be true or false, and to cause the witness’s memory of events to be based increasingly on this material and later interpretations of it rather than on the original experience of the events.
 
21. It is not uncommon (and the present case was no exception) for witnesses to be asked in cross-examination if they understand the difference between recollection and reconstruction or whether their evidence is a genuine recollection or a reconstruction of events. Such questions are misguided in at least two ways. First, they erroneously presuppose that there is a clear distinction between recollection and reconstruction, when all remembering of distant events involves reconstructive processes. Second, such questions disregard the fact that such processes are largely unconscious and that the strength, vividness and apparent authenticity of memories is not a reliable measure of their truth.
 
22. In the light of these considerations, the best approach for a judge to adopt in the trial of a commercial case is, in my view, to place little if any reliance at all on witnesses’ recollections of what was said in meetings and conversations, and to base factual findings on inferences drawn from the documentary evidence and known or probable facts. This does not mean that oral testimony serves no useful purpose – though its utility is often disproportionate to its length. But its value lies largely, as I see it, in the opportunity which cross-examination affords to subject the documentary record to critical scrutiny and to gauge the personality, motivations and working practices of a witness, rather than in testimony of what the witness recalls of particular conversations and events. Above all, it is important to avoid the fallacy of supposing that, because a witness has confidence in his or her recollection and is honest, evidence based on that recollection provides any reliable guide to the truth.”

Of course a good witness will not always win the day any more than a bad witness will necessarily always lose the case for the party calling them.  Lessons can though be learned and remembered from Saeed, not forgetting the Judge’s ultimate conclusion on the evidence he heard requiring him to acknowledge at paragraph 20 of the Judgment:

“…the actual unreliability of almost everyone who gave oral evidence (the exception being D2, but she had almost no actual involvement or relevant knowledge).”

 

Reliance on other party’s statements

We recently reported on the authority of UK Insurance Ltd v Stuart John Gentry [2018] EWHC 37 (QB)  dealing with the issue of what adverse inferences could be drawn from the absence of (what might be seen as) material witnesses.

The Court of Appeal had cause to consider an adjunct to this question earlier this month when they handed down judgment in Property Alliance Group Ltd v The Royal Bank of Scotland Plc [2018] EWCA Civ 355.  The facts of the case are not important to this article but the comments towards the end of the Court of Appeal’s judgment on whether a party can rely on a statement served by the other side where that witness has not been called to give evidence are.

Before addressing that it is fair to note that the Court of Appeal did, albeit briefly, comment on the absence of material witnesses when it said:

  1. No litigant is obliged to call witnesses to satisfy the curiosity or enthusiasm of his opponent. It was always open to PAG to subpoena any witness it thought would be helpful to the Court. The fact that a party who might be expected to produce witnesses does not do so may sometimes speak volumes but it is a matter for the Judge to decide whether it does so in a particular case. The critical question in the present case was whether manipulation of GBP LIBOR had taken place. The critical witness for that purpose was Mr Thomasson. If he was believed, there was nothing relevant for senior management to know; if he was not, RBS’s case collapsed anyway. The Judge did say (paragraph 461) that RBS’s decision not to call Mr Cummins (and a Mr Nielsen) in connection with the allegations of lowballing did not reflect well on RBS and repeated this in her decision on whether RBS had been fraudulent (paragraph 485). She was well aware of Mr Lord’s case (paragraph 479) but in the end was not prepared to draw an adverse inference. We do not think the Judge can be criticised.

Turning back to the potential reliance on the witness statements of those not called to give evidence, the Civil Procedure Rules seemingly makes the position clear at 32.5(5):

“(1) If –

(a) a party has served a witness statement; and

(b) he wishes to rely at trial on the evidence of the witness who made the statement,

he must call the witness to give oral evidence unless the court orders otherwise or he puts the statement in as hearsay evidence.

(5) If a party who has served a witness statement does not–

(a) call the witness to give evidence at trial; or

(b) put the witness statement in as hearsay evidence, any other party may put the witness statement in as hearsay evidence.”

The Court considered previous authority on this point, in particular McPhilemy v Times Newspapers Ltd (No. 2) [2000] 1 WLR 1732, and in an admirably clear pronouncement concluded:

  1. In our view, CPR 32.5 is not applicable where a party wishes to put in only part of a witness statement. The rule itself refers to “the witness statement” being admitted, not merely some of it. Further, it makes sense that a party wanting to rely on something said in a statement should have to place all of the statement before the Court. A Court asked to attach significance to a passage from a statement should have before it the totality of what the witness said. There would otherwise, as the Judge noted in paragraph 296 of her judgment, be “real concern that cherry picking out of context would arise”. It would, moreover, be odd if a party were free to contend for the reliability of what the witness said in a particular passage while withholding the balance of the statement because he disputed it. That, in fact, would seem to have been the position in the present case had the Judge acceded to PAG’s application. PAG, we gather, was unwilling to put in Mr Sefton’s witness statement in its entirety because most of what he said was adverse to its case. It follows that, in our view, the Judge was correct to refuse PAG’s application.

It may be that in housing fraud trials less attention is paid to the content of trial bundles in the context of those witnesses not being called, and certainly proper legal analysis of the status of such evidence is rarely entered into, but this case highlights both the basic rules applicable and their proper application and may prove significant in the “right” case.

Absence of material witnesses

In December 2017 the High Court had cause to consider a claim by an insurance company for damages based on the assertion that the Defendant had fraudulently represented to them that his car had been in collision with another vehicle driven by  someone who they insured. Mr Justice Teare handed down judgment in UK Insurance Ltd v Stuart John Gentry [2018] EWHC 37 (QB)  on 18 January 2018 and awarded the Claimant damages of £19,179 in addition to interest and costs.

One of the most interesting aspects of the judgment was a reminder of the court’s approach to “missing” witnesses, and at paragraph 68 the Judge noted:

“Mr. Grant on behalf of the Claimant invited the Court to draw adverse inferences from the failure of Mr. Gentry to give evidence (or to call evidence from Mr. Miller, Mr. Ebbs, and Mr. Toms). The circumstances in which inferences may be drawn have been summarised by the Court of Appeal in Wisnewski v Central Manchester Health Authority [1998] PIQR P324 at p.14 in these terms:
“(1) In certain circumstances a court may be entitled to draw adverse inferences from the absence or silence of a witness who might be expected to have material evidence to give on an issue in an action.
(2) If a court is willing to draw such inferences, they may go to strengthen the evidence adduced on that issue by the other party or to weaken the evidence, if any, adduced by the party who might reasonably have been expected to call the witness.
(3) There must, however, have been some evidence, however weak, adduced by the former on the matter in question before the court is entitled to draw the desired inference: in other words, there must be a case to answer on that issue.
(4) If the reason for the witness’s absence or silence satisfies the court, then no such adverse inference may be drawn. If, on the other hand, there is some credible explanation given, even if it is not wholly satisfactory, the potentially detrimental effect of his/her absence or silence may be reduced or nullified.””

To give one example of how this might operate in a housing context, consider a possession claim where the landlord seeks to show that the tenant did not live at the demised premises as their only or principal home at the expiry of a notice to quit.  They have credit reference evidence linking the tenant to an alternative address which proves to be their partner’s.  The tenant does not call this person to give evidence, or they do not attend trial.

The two-stage approach will then be:

(a) why has the partner not been called or not attended trial?

(b) if there is no good reason, should the court draw an adverse inference such as to diminish the defendant’s evidence or bolster that of the claimant?

Finally, as part of the evidential overview, the importance of the Court of Appeal decisions in Lambeth LBC v Vandra [2005] 1801 (see paragraph 8 concerning the absence of direct evidence) and Islington LBC v Boyle [2012] PTSR 1093 (see paragraphs 55 & 65 with respect to the need for the tenant to rebut an inference in two homes cases) should not be overlooked.