The Making Of An Expert: A Summary Of The Duties Of Expert Witnesses

Synopsis

As one of the leading offshore jurisdictions globally for the resolution of complex financial services disputes, expert witnesses are frequently appointed to provide evidence to the Financial Services Division of the Grand Court of the Cayman Islands (the 'Court') on a wide array of disciplines. Their role is becoming increasingly important as the financial services industry continues to evolve and gives rise to the emergence of expertise in new categories of disputes, such as shareholder appraisal rights in the context of mergers and fair value petitions where the opinion of an expert can well determine the outcome of the case.

This memorandum focusses on some of the key pretrial procedural aspects relating to the appointment of experts in the Cayman Islands, including the duties they owe to the Court, the required form and content of their reports, and meetings between party appointed experts.

Directions for the appointment of an expert

Except with the leave of the Court or where all parties agree, expert evidence cannot be adduced.1 In practice this means that if the parties are unable to agree upon directions for the appointment of one or more experts in a particular discipline (e.g. forensic accountancy, or foreign law), the requesting party must apply to the Court seeking a direction to that effect. Such applications would ordinarily be determined by the Court at a directions hearing or case management conference shortly after the commencement of the proceedings. The directions available to the parties and the Court vary and will be tailored to the proceedings in hand but common elements are (a) identifying the scope of the expert evidence; (b) the form in which the expert evidence is to be provided (a written report being the default and preferred form); (c) the deadline for filing and exchanging such reports; (d) whether a sole expert may be utilised, or whether the parties may appoint separate experts; (e) the deadline for any meetings between the separate experts in an attempt to narrow the issues in dispute; and (f) the deadline for the filing and exchanging of any reply reports.

The question of determining the appropriate number of experts was considered by the Court in the recent decision of In the Matter of Qunar Cayman Islands Ltd,2 which concerned a fair value petition under Section 238 of the Cayman Islands Companies Law3 where there were multiple dissenters. If each dissenter were to be permitted to instruct their own valuation expert, the Court would have needed to hear evidence from five different experts. The Court, pursuant to its case management powers, decided that one expert should be instructed by the dissenters jointly and severally on the...