Evaluating The Admissibility Of Expert Valuation Evidence

Following the Court of Appeal's decision to dismiss the appeal of Jamie Cooper-Hohn for permission to adduce evidence of the value of her husband Sir Christopher Hohn's management entities, we take a closer look at the decision.

The Court of Appeal dismissed the wife's appeal against a decision preventing her from adducing expert evidence as to the value of management companies which managed the hedge fund the husband had established, on the basis that, such evidence was speculative, theoretical and unnecessary, and the issue had been raised far too late.

Background

The court found that the husband had not hidden the existence of the management entities. In December 2012, with his initial disclosure, he ascribed a net asset value to those companies, accompanied by a narrative explanation of the rationale for this, and a copy of the key man clause.

This clause recorded that he was the sole investment decision-maker and key man, whose inability or unwillingness to continue to manage the fund would trigger an inevitable liquidation of the fund, and the cessation of the income stream.

The disclosure exercise was completed without the wife raising the issue. Directions were agreed by consent in June 2013. No direction was sought or made for the valuation of the management entities.

Coleridge J's decision

On 28 March 2014, three months before the final hearing, the wife made her application. That application was heard and refused by Coleridge J at the pre-trial review on 8 April 2014. The wife appealed that decision.

It was not until 28 May 2014 that the wife served the report on which she wished to rely.

Court of Appeal decision

On 18 June 2014, Ryder LJ (with whom Tomlinson and Laws LJJ agreed) refused permission for the wife's appeal on the same bases that Coleridge J had rejected...