BuildLaw Issue 35 April 2019 | Page 26

between the parties was an amended NEC3 form option A with payments of lump sums to be made against identified activities. Compensation events (variations to the contract) were to be valued by reference to a schedule of rates.
Although that was the clear contractual division for valuing the works, Mr K proceeded to value the whole of the works using the actual cost to MMT as the basis of the valuation. There was no contractual basis for this method of valuation whatsoever. Mr K justified his approach by saying that a valuation on any other basis would result in a windfall to MMT. He explained:
"Whilst interpretation of the Contract is a matter for the Court to decide, I am of the view that the rates that I propose to use, representing what I believe to be MMT's actual costs, are more reflective of the true cost to MMT, whereas the rates proposed by MMT would, in my opinion, provide MMT with a windfall."
Fraser J listed a multitude of reasons why this was not the type of evidence that an independent expert, complying with their duty to the court, should be giving. ICI, Mr K’s instructing party, had not even pleaded that MMT was to be paid based on its actual costs. He had therefore failed to consider the pleaded issues and was attempting to rewrite the parties’ bargain.
His use of the term ‘windfall’ made it clear that he had adopted a different method of valuation because he felt MMT would be paid more than it ought to have been if the correct contractual approach was used. That was “diametrically opposed” to the exercise he should have done, as it suggested that he had worked towards a figure he thought was fair, rather than doing a proper valuation in accordance with the contract and ascertaining the correct figure. It also suggested that he had carried out some valuations using the schedule of rates, was unhappy with the result, and so decided to use a different method.
Mr K committed another cardinal sin amongst experts that is guaranteed to annoy a judge, namely taking positions on matters of fact in dispute which were outside his area of expertise. So, for example, there was factual evidence from MMT’s witnesses that the majority of the steelwork was outside the main building under construction. Mr K refused to accept this, calling it a “common misconception.” Fraser J was surprised that Mr K believed himself to be in a better position than any of the contemporaneous witnesses to evaluate these matters of fact, or that he saw fit not to agree with their factual evidence.