Should surveyors give evidence in telecoms disputes?

Expert evidence is a particularly pertinent topic this year, when the fifth edition of RICS Surveyors acting as expert witnesses is in production.

On 28 December 2017 the Electronic Communications Code, set out in Schedule 1 to the Digital Economy Act 2017, was inserted as Schedule 3A to the Communications Act 2003 and became known as the 'new code'. The new basis for consideration (rent) created tension in the telecoms world between operators and site providers, which has continued ever since and is why it has been such a significant feature of the work of the Upper Tribunal (Lands Chamber) in the intervening years.

When the new code took effect, the provisions were not as recommended in the 2013 Law Commission Report. This report proposed that rent for mast sites should be based on market rent – informed by the version of the Red Book that was current at that that time: RICS Valuation – Professional Standards – and subject to assumptions that would exclude ransom value and pay-away for sharing or assignment by the operator.

Subsequent consultations and proposals led to the inclusion of a further market value assumption – that the right should not relate to the provision of an electronic communications network. This was originally described as a 'no-scheme' basis, but it fell to the Lands Chamber to interpret the meaning of paragraph 24, and in the 2019 case known as 'Threadgold House' – EE Limited and Hutchison 3G UK Limited v The Mayor and Burgesses of the London Borough of Islington [2019] UKUT 0053 (LC) – the deputy president introduced the term 'no-network assumption'.

A compulsory purchase approach to consideration was therefore substituted for what had previously been market-led rents, which operators considered had become too generous to site providers. A fight was probably inevitable. It is hard to envisage that site providers would unquestioningly accept the shift to much lower annual consideration on renewal of a mast agreement where nothing would change on the ground. 

It is also hard to envisage that the operators, who had lobbied hard for the new provisions, would not have fought to enforce them. The commercial stakes on both sides, combined with novel valuation assumptions, inevitably sharpened positions and increased the number of contested references.

It is worth mentioning that not all operators went down the dispute route. In some situations, deals were done with existing site providers where renewals were agreed at rents that would be stepped down over a period of years from the old to the new.

This commendable and pragmatic approach achieved the aim of the new code while acknowledging the unpalatable impact on site providers of the drop in income. I understand that this approach to deal-making continues today where agreements with that particular operator come up for renewal.

Perhaps one of the most notable features of telecoms disputes is that the experts appear to be polarised. I am aware of one, possibly two, experts who have given evidence for a site provider in one case and an operator in another. If there are others, then they have stayed beneath our radar – which might suggest that they reached a settlement by negotiating to an agreed position. 

It is hard to refute the fact that when discussing independent expert evidence, the optics of polarised experts are not good. While the role of legal representatives is to represent their clients' best interests, the role of experts is to assist the court, and there is a world of difference between those roles. Perceptions of partisanship can undermine confidence in expert evidence – even where the analysis is technically sound – so the way experts present and test their own conclusions matters as much as the conclusions themselves.

The key principles for expert evidence were laid down in the 1993 case known as the 'Ikarian Reefer' – National Justice Compania Naviera SA v Prudential Assurance Co Ltd [1993] 2 Lloyd's Rep. 68 (Comm Ct). They are simple: experts must ensure that their evidence is independent, impartial and objective.

The parties to a dispute will usually have started negotiations to resolve the matter eventually referred to the tribunal and, in most cases, will have been professionally represented in those negotiations.

Then, when a reference is made to the tribunal, those professionals who represented the parties in negotiations may swiftly become the experts who are required to give us independent and impartial evidence. They were not independent when they were negotiating, and they cannot suddenly become independent when they give evidence. But can they become impartial and objective?

Or should the parties instruct other experts de novo to ensure that the evidence given is independent? In some cases that may be the only answer. Where a party retains a professional who has negotiated the matter, the tribunal expects explicit disclosure of all prior roles and of any advocacy previously carried out, together with a clear statement of how the expert has tested their own analysis against contrary evidence.

We acknowledge that the professionals who have previously negotiated in a dispute are the ones who know the property well, and they certainly understand the nuances of the dispute best. They will inevitably, even if subconsciously, lean towards their previous negotiating positions, but their evidence and their perspective can still be helpful to us and we recognise that. So, we manage the situation through our Practice Directions, in particular the case management directions we issue for each reference. 

An impartial expert will give consideration to all relevant evidence and will achieve objectivity by avoiding confirmation bias, which is the tendency to process information by looking for, or preferring, information that is consistent with an existing opinion.

Once expert reports have been exchanged, our directions encourage the experts to communicate directly on a 'without prejudice' basis to seek clarification of the reasons for their different opinions, rather than through a formal exchange of questions and answers led by solicitors. This may lead, with our permission, to an exchange of supplemental expert reports and possibly to a narrowing of the issues in dispute.

We emphasise the word supplemental and never use the term rebuttal – which would indicate that the expert has a position to maintain for their team. An impartial expert will respect the opinion of another expert and be prepared to consider how their own view might change under an alternative assumption. 

The final stage before the hearing is for the experts to produce a joint statement of agreed facts and the issues and reasons for the differences of opinion that remain between them.

At the hearing the true impartiality and objectivity of the expert will be tested under cross-examination, which can be a daunting experience. It is important to keep in mind that the purpose of expert evidence is to assist the court or tribunal.

The experts that we find most helpful, and whose evidence will be given most weight, are those who display independence of thought and remain open-minded, rather than defensive. They are prepared to see an alternative view but can explain why they might not adopt it. They are self-aware, particularly if they have previously advised the party for whom they are giving evidence, and they do not bluster when challenged.

In the Lands Chamber we are aware that the role of expert witness can appear so demanding that many think it should be left to senior professionals, and to those whose main area of practice is giving expert evidence. But this underestimates the value we place on the opinion of any professional with expertise and experience in their field, particularly if they are putting it into practice for clients on a daily basis.

The current edition of RICS Surveyors acting as expert witnesses is a substantial document that requires careful scrutiny and regular rereading. But for a straightforward overview of what is expected I commend RICS Professional Statement and Practice Alert – Concordance – February 2024. This was produced in the wake of the February 2024 RICS Practice Alert – Expert Witnesses and poses 13 simple questions for surveyors to reflect on when considering whether to provide expert evidence. The questions are cross-referenced to the in-depth professional guidance and are a helpful way to understand the purpose behind it.