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Expert Determination

Zarmina Chaudhry | Thursday 20 November 2014 ( 0 Comment)



Expert Determination

Expert determination is being widely used in real estate and construction industry. It has always played a greater role in valuation a dispute, so we can say that concept of expert determination is originated from valuation disputes.

A final and binding decision is one of main and perceived advantages of expert determination but an expert while exercising in this regard if does not use the level of skill and care that is required in reaching that decision, may be sued for negligence.

Interesting fact is that a party may set aside the expert determination.

 In Shafi v Rutherford [2014] EWCA Civ 1186, an expert was appointed for determination of a dispute regarding amount to be paid for a share in dental practice. The expert identified that some leases were not treated while accounts of dental practice were maintained. According to expert correction of those identified accounting errors was not to consider and outside the scope of his instructions, hence valued the shares on those incorrect accounts.

It was found by court of appeal that treatment of those identified leases on the accounts was within scope of expert determination and the letter of instruction to expert as well. The court of appeal therefore decided to appoint new expert for a new determination.

This is a rare example of the courts interfering with expert determination because, as noted above, an expert determination cannot generally be appealed or challenged. When entering into a contract, it is common for parties to agree on provision which provides for binding expert determination. This ensures that the effect of the decision of the expert is certain and is often cited as a benefit of using expert determination to resolve disputes.

This is a very rare example of courts, to set aside and vary the expert determination. Usually expert determination cannot be appealed or challenged. Parties commonly agree into the contracts containing provisions that ‘such determination will be binding’. This clearly shows that effect of using an expert for determination always proves as beneficial to resolve many disputes.

However, there are certain other grounds which can, in limited circumstances, lead a court to set aside or vary an expert determination:

Still there are number of certain ground that lead a court to outcast or change an expert determination as under.

  • Material departure from instructions  as described above in Shafi v Rutherford
  • Failure to state reasons
  • Fraud or collusion
  • The certificate not being certain
  • Partiality

The content of this blog is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.


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