Often times, experts are retained as a reporting deadline looms. It seems that this behavior is driven, at least in part, by a desire to defer litigation costs in the hope that the matter settles before trial.
Back in the day this practice kept things interesting because the reporting deadline, in Ontario, was ten days before trial. The courts have recognized that change was needed and the Rules of Civil Procedure concerning the delivery of expert reports have since been amended. The reporting deadline was first moved back to 90 days before the trial, and most recently has been moved back to 90 days before pre-trial.
There is nothing like a deadline to focus attention on the needs of an assignment. But earlier retention of experts is often preferable because deferring this assistance until deadlines are looming can result in hidden costs, including:
1. Availability of the Preferred Expert(s)
The pool of available experts is not infinite and in many cases you will have a preferred first choice. Deferring the hiring of the expert can mean that your preferred choice is not available, either because he/she has been retained by opposing counsel or because he/she is "sold out" in the short term.
Compounding the problem, it is not uncommon that the damages expert will identify a need for another specialist (e.g. a cost surveyor in a construction case). In many cases the work of this other expert must be completed (at least in draft) before the financial damages expert can complete his/her work since the financial analysis will be based, to some extent, on this other expert's findings.
2. Reduced Access to Potentially Useful Information
The Examination for Discovery process is a valuable mechanism to obtain information, including information relevant to the assessment of the financial loss. I am often retained at an early stage of the proceedings to assist counsel in identifying issues/questions to be addressed at the discovery.
Without the assistance of an expert, it falls on counsel (and perhaps the client) to identify the relevant issues and documentation. In going it alone, counsel can be creating an unnecessary risk, particularly where the damages issues are more complex. First, there is a risk that relevant financial documents/issues will be missed. Second, there is a risk that important implications arising from the answers/productions will not be apparent and follow up questions will not be asked.
Documents common to different types of cases are too numerous to list here but examples of common document requirements are listed on our website at www.cvpl.com.
If Discovery has closed, the expert may not be able to get information that he/she feels is relevant to the analysis. Restricted access to information can adversely affect the expert's analysis and findings. If the restriction is significant, the expert should include the nature and effect of the restrictions in his/her report (see below).
In Ontario, the expert's overarching obligations to the court are now formally documented in the expert's Declaration (Form 53) that is appended to his/her report. This form provides, among other things, that the expert is to provide opinion evidence that is fair, objective and non-partisan and to provide such additional assistance as the court may reasonably require. Information concerning material restrictions on the scope of the expert's review is additional assistance that can be provided to the court.
The Canadian Institute of Chartered Business Valuators has recognized the importance of reporting any limitations governing the expert's analysis and findings. The CICBV Practice Standard #310 - Scope of Work Standards and Recommendations states, in part:
"When access to essential information is denied by the client or some other party or is otherwise unavailable to the Expert, any conclusion expressed by the Expert in the Expert Report shall be qualified and the limitation(s) on the scope of work clearly set out in the Expert Report."
CICBV Standard #310 - Report Disclosure Standards and Recommendations for Expert Reports states, in part:
"Where the conclusion is qualified by a scope limitation, the limitation shall be explained, setting out the reasons for the limitation and disclosure of the potential impact on the Expert's conclusion. (Explanatory comment: to the extent that the scope of review has been significantly restricted, or information provided is substantially incomplete, the Expert shall determine if an unqualified conclusion can be provided. If the Expert Report is qualified because of a scope limitation, the details shall be fully disclosed)."
Scope restrictions are not desirable and can adversely affect the relevance and reliability of the expert's conclusions. This is a cost that can be avoided/reduced by retaining your expert at an early stage of the litigation.
Determining the financial ramifications of an event that has not occurred is, by its nature, often dependent on assumptions. For example, assumptions regarding the liability for a breach, or the validity of a contract are necessary and unavoidable, and the fact that these assumptions are required will not generally impact the expert's report.
On the other end of the spectrum, where assumptions replace facts that could have been established through due diligence, there can be an impact on the usefulness of the expert's report. More on this in the next instalment.
In summary, in cases with complex financial issues, it is good practice to seek assistance from a financial expert early in the proceedings to ensure a thorough and efficient fact finding exercise. To quote Aldous Huxley "Facts do not cease to exist because they are ignored [or missed]."
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.