“The Solace of Quantum” – Experts in International Arbitration

On 21 March 2018 the London Branch held a seminar entitled “The Solace of Quantum”, which addressed a number of issues relating to the use of experts in general and quantum experts in particular in international arbitration.

The seminar was generously hosted by CIArb corporate member Grant Thornton LLP. 

The interactive session, which was chaired by Vidya Rajarao (Grant Thornton LLP), offered insights from a respected panel of lawyers comprising Philippa Charles (Stewarts), Louise Woods (Vinson & Elkins) and Aimee-Jane Lee (Debevoise & Plimpton). Irvinder Bakshi (London Branch Chairman) introduced the event, at which Daniel Djanogly (CVR Global LLP) acted as convenor. 

Addressing four key topics, the speakers explored how tribunals and counsel may best engage with and efficiently use quantum experts in international arbitration. The panel first considered the importance of choosing the right expert. Aimee-Jane Lee identified the wide range of quantum experts that may be involved in proceedings, ranging from forensic accountants to experts specialising in private equity, land valuation and specific market practice issues. Philippa Charles noted that issues of valuation normally require an experienced forensic accountant but that in niche industry areas it is often necessary to augment market knowledge with financial understanding. Louise Woods noted that two experts may be appropriate, where the case calls for it and emphasised the importance of the client acknowledging the benefits of and need for an upfront investment. Cost was recognised by the panel as a key issue when instructing experts, particularly in lower value disputes. Providing the arbitrator’s perspective, Philippa Charles observed that it was important for the tribunal to have confidence in the expert – selecting an expert with some industry or practical experience assists in this regard.   

Secondly the panel considered the importance of properly instructing experts. Louise Woods observed that early engagement with experts helps lawyers to better understand their case and the prospects of success, enabling clients to better appreciate the realities of their case. The panellists agreed that early engagement with experts did not happen as often as it should due to cost implications. Philippa Charles explained that she had often used experts in an advisory capacity from an early stage of proceedings before instructing another expert from the same firm as testifying expert. Aimee-Jane Lee noted that it was important to be mindful of the development of a working relationship between the client and expert – an expert must remain independent and cannot compromise such independence by becoming the trusted advisor of the client. The panellists considered the difficulties that arise when the parties’ experts are given different instructions. Philippa Charles offered the arbitrator’s perspective, noting that tribunals have a role to play by getting to grips with expert evidence and inviting the parties to agree on the issues to be addressed by the experts. Aimee-Jane Lee acknowledged that the instructing stage was often too early for even a very interventionist and well prepared tribunal to get involved, noting that at this early stage even counsel may not understand the scope of the dispute.  

Thirdly the panel addressed best practice in working with experts. Aimee-Jane Lee emphasised that counsel should work closely with experts in order to avoid surprises and should not be afraid to ask an expert to explain their work. Respecting the work undertaken by both sides is key. She noted the key role to be played by experts in testing the evidence of the other side’s expert, on the basis that they can read such evidence with expert eyes and put it to proof. Vidya Rajarao, providing the expert’s perspective, observed that the language used by an accountant will differ from that used by a lawyer. The expert’s role is not to advance arguments. Louise Woods highlighted the obvious tactical advantage that will be handed to opponents in the event that lawyers choose to rewrite parts of an expert’s report – such sections will stand out and will be the subject of cross examination. Philippa Charles acknowledged the importance of making sure that experts know what their report says and the source of everything in it, mindful that in large firms a team may assist the expert with preparation of their report. 

Lastly consideration was given to different issues arising in the context of proceedings, in particular the benefits of ‘hot tubbing’ and the preparation of joint quantum models. Louise Woods recognised that the attitude of counsel to joint expert meetings is likely to be influenced by their confidence in their case, noting that such meetings can assist the tribunal, particularly if the reports address different issues. Such techniques should work alongside other evidence presentation techniques such as separate presentations to frame the expert’s testimony and cross examination. Aimee-Jane Lee noted that counsel may be concerned about how an expert will stand up in a ‘hot tub’ scenario and acknowledged that ‘hot tubbing’ works best when the tribunal is really engaged. The panellists were wary of adopting ‘hot tubbing’ as an alternative to cross examination and of experts meeting without lawyers present but in favour of parties sharing both pdf and excel versions of their quantum evidence. Philippa Charles observed that experts meetings can help to narrow the scope of the evidence to be heard and joint memos can therefore be helpful. She highlighted the importance of transparency and the need for someone of the team, whether expert or counsel, to understand the quantum numbers down to the last cell. 

Irvinder Bakshi thanked the speakers and attendees for their insights before inviting the speakers and attendees to attend the cocktail reception generously hosted by Grant Thornton LLP.