Treatment of expert evidence in competition judicial review cases

18 Jul 2014

On 9 July 2014, the Competition Appeal Tribunal handed down judgment in response to an interim application made by HCA International Limited (“HCA”) to introduce expert evidence as part of its challenge to the decision of the Competition and Markets Authority (“CMA”) to require HCA to divest two of its hospitals in Central London as part of its private  healthcare investigation.  The Tribunal held that It was exceptional for expert evidence to be admitted in applications for review under the  Enterprise Act 2002 s.179.  Expert evidence would only be admitted in situations where it was required to assist the Tribunal in understanding an issue which it had to determine.

The Tribunal held that the approach to be applied to an application for review under s.179 was that appropriate to judicial review. The admission of expert evidence in judicial review proceedings was exceptional and was confined to situations where expert evidence was required to assist the court in understanding an issue which it had to determine.  In previous cases, the Tribunal had applied the principles applicable to admission of expert evidence in judicial review proceedings and had been slow to admit expert evidence in s.179 challenges. There were strong reasons which supported that approach. If expert evidence was admitted in relation to matters which ought to be the subject of submissions, that would waste time and money and might give rise to confusion and a loss of proper focus. Opposing parties would feel driven to adduce their own expert evidence and everyone might feel driven to cross-examine the opposing expert witnesses to avoid it being said that their evidence was unchallenged. Further, the CMA had particular expertise in evaluative assessment of economic evidence. In review proceedings, the well-established approach was that a substantial degree of discretion or significant margin of appreciation was allowed in relation to expert assessments made by the CMA. The CMA was rightly resistant to attempts to convert its review jurisdiction into something resembling an appeal on the merits. The Tribunal was also well equipped to assess the relevant factual matters in a s.179 case without needing assistance from expert witnesses. It was a body with technical expertise and the sort of situation in which technical assistance was required was not likely to be common.

The Tribunal held that, in this case, there was nothing about the expert report which led to the conclusion that it would be assisted by its admission or that the just determination of the case required it. Moreover, several matters pointed strongly against its admission. The expert was not coming to the proceedings as a fresh and independent expert, but as HCA’s economic adviser. He had not been briefed clearly regarding the difference between an appeal on the merits and the approach to be adopted under judicial review principles. His report did not address the distinct questions which were relevant in s.179 proceedings, such as whether a regulator could reasonably hold particular views or reach particular conclusions, as distinct from whether the expert himself agreed with those views or conclusions. Insofar as he had made points which were suitable for consideration in the s.179 proceedings, they did not require expert opinion and there was no good reason why HCA could not make those points. It was not necessary for expert evidence to be admitted to secure compliance with the  European Convention on Human Rights 1950 art.6  since points of substance could be made by HCA’s legal representatives. Further, the requirement for the Tribunal to determine the proportionality of the remedy adopted by the CMA did not require expert opinion. There were strong reasons why the Tribunal should not be diverted from the efficient and speedy resolution of disputes on judicial review principles by the admission of expert evidence.

Please click to view the judgment in HCA International.

Kassie Smith QC and Rob Williams acted for the CMA.

Josh Holmes acted for HCA.

Ronit Kreisberger acted for the intervener, TLC