Expert Evidence: The Importance of Proper Consideration

A recent Privy Council decision looks at how courts must treat the evidence of expert witnesses (Caribbean Steel Co Ltd v Price Waterhouse (A Firm) [2013] UKPC 18).

In this case the plaintiff ("CSC") acquired a majority shareholding of Caribbean Cable Company Limited ("CCC") for $32m (Jamaican dollars).  Before CSC completed the purchase it obtained a valuation of CCC from Price Waterhouse (auditor of both CSC and CCC) which described a pension fund surplus of $13.85m as an asset of CCC.

Price Waterhouse continued to act as auditor to CSC after the acquisition of CCC.  Fifteen months after the acquisition it emerged that CCC had $1.4m in outstanding borrowings from its pension fund at the time that Price Waterhouse had carried out its valuation, which were not mentioned in the valuation report.