An Expert's Fiduciary Duty Of Loyalty To Their Client - A V B [2020] EWHC 809 (TCC)

• Published date: 15 July 2020
• Subject Matter: Litigation, Mediation & Arbitration, Arbitration & Dispute Resolution
• Law Firm: Fenwick Elliott LLP
• Author: Mr Jesse Way

In this case, the claimant sought continuation of an injunction restraining the defendant from acting as experts for a third party in an ICC arbitration against the claimant. The case is important because it clarifies the duty owed by experts to their clients.

The claimant was a developer of a petrochemical plant ("the Project"). The claimant engaged the first defendant (in Asia) to provide expert services with respect to an arbitration commenced by a contractor known as "the Works Package Arbitration" relating to the Project. The first defendant's scope of works included identifying and analysing delay events and the root cause for the delays. In the Works Package Arbitration, the contractor claimed additional costs by reason of delays to its work, including the late release of Issued For Construction ("IFC") drawings. The IFC drawings were produced by the third party and the claimant's position was that to the extent it was liable to pay the contractor any sums due to the late release of IFC drawings, these costs would be passed on to the third party.

The first defendant (in Asia) started work on the Works Package Arbitration from June 2019.

In the summer of 2019, the third party (producer of the IFC drawings) commenced arbitration proceedings against the claimant, known as "the EPCM Arbitration", relating to the Project. In October 2019, the third party approached the defendants to provide quantum and delay expert services (outside Asia) in connection with the EPCM Arbitration (bearing in mind in the Works Package Arbitration the third party's release of the IFC was in issue).

In other words, the third party had approached the defendants to provide expert services (outside Asia) against the claimant in the EPCM Arbitration in circumstances where the defendants were already providing expert services (in Asia) for the claimant in the Works Package Arbitration.

A representative of the first defendant contacted solicitors for the claimant regarding the approach from the third party, stating there was no "strict" legal conflict on the basis that the third party's contract with the claimant was for EPCM works, the first defendant's engagement was in relation to evaluation of delays on the construction subcontract for non-process buildings, the work would be done in two separate offices, and the firm had the ability to set up physical and electronic separation between the teams. The claimant's solicitors disagreed during a telephone conversation, after which the representative of the first defendant sent an email stating "We've had an internal...