Under Construction - Q3 2021 – 2 / 5 观点
In Secretariat Consulting PTE Ltd & Ors v A Company  (EWCA Civ 6), the Court of Appeal recently considered the scope of an expert's fiduciary duties to its client. Whilst leaving open the possibility that a fiduciary duty of loyalty might arise in appropriate circumstances, the contractual terms of the retainer should be considered first, and are likely, as in this decision, to hold the key.
The Claimant (the Respondent in this appeal action, "A Company") is the developer of a large petrochemical plant. Secretariat Consulting Pte Ltd (SCL) was engaged to provide expert witness services to the Claimant, who was the respondent in an arbitration brought by one of the Claimant's subcontractors responsible for the construction of certain facilities at the plant.
SCL's retainer included the following confidentiality clause: “Under no circumstances shall [SCL] at any time, without the prior written approval of [the respondent’s solicitors] acknowledge to any third party what is or is not a part of the Confidential Information, nor shall [SCL] acknowledge to any third party the execution of this Agreement, the terms and conditions contained herein or the underlying discussions with [the respondent’s solicitors]”. The retainer also provided that SCL had “confirmed you have no conflict of interest in acting for [the respondent] in this engagement. You will maintain this position for the duration of your engagement.”
Later, Secretariat International UK Ltd (SIUL) was approached by the project's project manager requesting that it provide expert witness services in respect of a separate arbitration against the Claimant. Among its duties, the project manager was required to provide the Issued For Construction Drawings (the IFC Drawings). The Subcontractor alleged that the timing of the issue of the IFC Drawings delayed and / or disrupted its progress therefore showing a clear link between the two arbitrations.
There was correspondence between SCL, SIUL and the Claimant where the Claimant made it clear that it considered that for SIUL to act for the project manager would be a conflict of interest. Despite this SIUL proceeded to act for the project manager.
Matters came to a head when the project manager sought to make claims against the Claimant and the Claimant's solicitor therefore sought to expand SCL's instruction. Secretariat's position appeared to be that it was able to put in place information barriers and therefore no conflict arose.
O'Farrell J decided at first instance that SCL owed a fiduciary duty of loyalty meaning SIUL could not provide expert services to a third party making a claim in another arbitration against the same respondent arising out of the same project and concerned with the same or similar subject matter. This is the first time the English courts have held that an expert could owe a fiduciary duty to its client.
O'Farrell distinguished between the preservation of confidentiality and privilege and the placing of one in a position where duty and interest may conflict. In circumstances where SCL and SIUL were part of the same group with a shared strategy, and in contrast to barristers who are self-employed, SCL and SIUL could not act for and against the Claimant on disputes relating to the same or similar subject matter.
Lord Coulson gave the leading judgment with which Lords Males and Carr agreed in substance, although Lord Males provided some additional reasoning.
Fiduciary duties normally arise in settled categories (of which expert witnesses to clients is not one), with further fiduciary duties arising in only exceptional circumstances. In essence a fiduciary duty requires the fiduciary to act in the best interests of the principal with no self-interested motive.
Lord Coulson decided that, whilst an expert's overriding duty is to the court or tribunal, that does not prevent the expert from owing a fiduciary duty of loyalty to his client; the two duties do not conflict. In fact, the two are supportive of each other given that the client will want a frank analysis of prospects of success before embarking upon litigation.
However, the judge concluded that "no purpose is served by designating the relationship as a fiduciary one" (para 65) and that there is a lot of "legal baggage" associated with fiduciary duties. Given that, in this instance, a fiduciary duty was not necessary as there was an existing contractual duty the judge therefore concluded that an expert/client retainer may give rise to a fiduciary relationship but it was not necessary to decide whether a fiduciary relationship arose on these particular facts.
SCL's contractual duty was a confirmation that no conflicts existed at the time the retainer was entered into and would not be created in the future.
Given that, in this instance, the Secretariat Group was marketed as a single brand and it was expressly acknowledged that the initial conflict check was undertaken across the whole Secretariat Group, the judge concluded that the contractual duty was in fact owed by the whole Secretariat group.
The judge decided that there was a conflict of interest on the facts for the following four reasons:
Whilst the potential implications of this case and subject matter are far reaching, the practical consequences are probably more self-contained. The question arising is whether or not two firms are genuinely separate firms. If, as is the case here, two companies in the same group are marketed and act as one group, they cannot be treated as separate companies for the purposes of conflicts. If two related companies genuinely operate completely separately there may be an argument that they should be treated as if they are unrelated, although the Court has not concluded on the exact circumstances that would need to arise for the duty to avoid conflicts to be imposed on a group, rather than just one company.
作者 Rebecca May