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Fenech & Anor v Financial Conduct Authority (PROCEDURE - expert report - whether witness was an expert - whether witness conflicted - unfair to admit as expert evidence - whether evidence of fact - if so, whether to admit after the time limit)
Smart Summary
Factual and Procedural Background
On 2 January 2024 Company A issued Decision Notices imposing financial penalties and prohibition orders on Appellant A and Appellant B. The Appellants referred those Decision Notices to the Upper Tribunal. Directions were issued on 6 March 2025 for preparation of a substantive hearing listed for 26 January–13 February 2026; those Directions included deadlines for witness evidence and permitted expert evidence in two areas: statistics and defined benefit pension transfer advice. Company A instructed Company B to review sampled client files. On 11 November 2025 Company A filed and served a witness statement from Attorney Prestage (the "Statement"), presented as expert evidence in relation to defined benefit pension transfer advice. At a case management hearing on 11 December 2025 the primary issue was the Appellants' applications to exclude the Statement as expert evidence on grounds that Attorney Prestage was not an independent expert and was conflicted. The tribunal delivered an oral ruling at that hearing finding Attorney Prestage to be an expert but conflicted and therefore that the Statement should not be admitted as expert evidence; the tribunal also permitted the Statement to be admitted late as evidence of fact. This document contains the tribunal's written reasons.
Legal Issues Presented
- Whether Attorney Prestage qualifies to give expert evidence in relation to defined benefit pension transfer advice.
- Whether Attorney Prestage is conflicted such that it would be unfair to admit the Statement as expert evidence.
- If the Statement is excluded as expert evidence, whether it should nevertheless be admitted late as evidence of fact.
Arguments of the Parties
Appellants' Arguments
- Attorney Prestage was conflicted because she was an employee and senior manager at Company B, which performed the file reviews under instruction from Company A; she supervised the team, chaired calibration meetings and had close operational involvement with the review work, including the recalibration of certain files.
- The Statement therefore lacks the necessary independence and amounts to "marking her own homework"; it should not be admitted as expert evidence and, if treated as factual evidence, it was filed late in breach of Directions.
- The Appellants relied on criticisms of the DBAAT and submitted that an independent expert ought to have been instructed to assess that tool and the review outcomes.
Company A's (Authority) Submissions
- Attorney Prestage is qualified and her evidence was comparable to her role in Fox-Bryant v FCA [2024] UKUT 357 where her expert evidence had been accepted; the tribunal should therefore accept her as an expert here.
- Even if there are concerns about independence, those relate to weight rather than admissibility and should be assessed at the substantive hearing.
- If the Statement is excluded as expert evidence, Company A would be prejudiced because no other Company B witness evidence about the review process had been filed; Company A sought permission to admit the Statement late as evidence of fact.
Table of Precedents Cited
| Precedent |
Rule or Principle Cited For |
Application by the Court |
| Whitehouse v Jordan [1981] 1 WLR 246 |
Expert evidence must be the independent product of the expert, uninfluenced by litigation pressures. |
Used to support the fundamental requirement of independence for expert witnesses when assessing Attorney Prestage's role. |
| Vernon v Bosley (expert evidence) [1998] 1 FLR 297 |
Metaphor of expert "walking down the middle of the road" to describe duty of independence. |
Invoked to illustrate that Attorney Prestage could not be on the same "pavement" as Company A given her involvement with the review team. |
| Field v Leeds City Council [2000] 32 HLR 618 |
Whether an expert may be an employee depends on expertise and awareness of duty to the court; employment does not automatically disqualify. |
Cited to note that employment alone is not determinative; tribunal considered whether Attorney Prestage met both relevant tests in context. |
| R (oao Factortame) v Secretary of State for Transport, Local Government and the Regions (No 8) [2002] 3 WLR 1104 |
Interest of an expert goes to weight; contingency/financial interests are highly undesirable; need to disclose any interest and manage via case management. |
Applied to reject a test of "apparent bias" but to require disclosure and case-management assessment of whether Attorney Prestage's interests preclude expert evidence. |
| Armchair Passenger Transport Limited v Helical Bar Plc [2003] EWHC 367 |
Summarises that existence of interest/connection matters by nature and degree; decisions on admissibility are fact-specific and should be addressed early in case management. |
Adopted to assess nature, extent and effect of Attorney Prestage's connection to Company B and Company A's project. |
| Toth v Jarman [2006] EWCA Civ 1028 |
Conflict of interest does not automatically disqualify an expert; key question is independence; material conflicts may lead to exclusion; disclosure at early stage important. |
Applied to conclude that Attorney Prestage's independence was compromised and that early disclosure was required but had not cured the conflict. |
| Rowley v Dunlop [2014] EWHC 1995 (Ch) |
Identifies common situations creating expert conflicts: financial interest, conflicting duties, personal connections that may influence evidence. |
Used to categorise Attorney Prestage's conflicts: (i) connection with Company A/team; (ii) financial interest via employer Company B; (iii) duty to employer. |
| Brendon International Ltd v Water Plus Ltd [2024] 1 WLR |
Independence questions generally affect weight rather than admissibility under section 3 of the Civil Evidence Act; qualification under statute is distinct from weight. |
Considered and distinguished: tribunal held Brendon did not displace authorities permitting exclusion of conflicted experts at case-management stage. |
| Denton v TH White Limited [2014] EWCA Civ 906 |
Framework for relief from sanctions: assess seriousness of breach, reasons for breach, and all circumstances including proportionality. |
Applied as part of the test for admitting late factual evidence (relief from sanction style analysis). |
| Martland v HMRC [2018] UKUT 178 |
Three-stage approach for extension/relief from sanction: length/seriousness of delay; reasons; balance of all circumstances and prejudice. |
Endorsed and applied to assess the appropriateness of admitting the Statement late as evidence of fact. |
| Umuthi Healthcare v FCA [2022] UKUT 275 |
Confirmed that the Martland approach applies in financial services Upper Tribunal cases. |
Referenced to support application of the three-stage test to the present extension/late-admission application. |
| Medpro v HMRC [2025] UKUT 255 |
Endorsed Martland's three-stage approach; discussed weight to be given to efficiency and compliance considerations. |
Applied as the tribunal's chosen formulation of the three-stage test for the late-admission decision. |
| Fox-Bryant v FCA [2024] UKUT 357 |
Factual account of Attorney Prestage's prior role in a related review project and how objections were handled in earlier proceedings. |
Distinguished: tribunal found the present case different because objections were made promptly here and Attorney Prestage had earlier and more direct involvement with the files under challenge. |
| Eclipse Film Partners No 35 LLP v HMRC [2016] UKSC 24 |
Addresses limits on tribunal powers to award costs; used to consider whether live transcript costs could be directed to Company A. |
Applied to refuse an application directing Company A to pay for a live transcript, noting the tribunal had no free-standing costs power in that respect. |
Court's Reasoning and Analysis
The tribunal proceeded in two linked stages: (A) whether Attorney Prestage could be admitted as an expert; and (B) if excluded as an expert, whether the Statement could be admitted late as factual evidence.
(A) Expert status and conflict analysis
- The tribunal accepted Attorney Prestage had the relevant qualifications and experience to be an expert in DB pension transfer advice.
- Independence was assessed against established authorities requiring expert evidence to be an independent product and for material conflicts to be disclosed and considered at case management.
- The tribunal found Attorney Prestage to be significantly conflicted on multiple grounds demonstrated in the Statement and the factual matrix: she managed the Company B review team, had QA oversight, chaired calibration meetings that changed outcomes (including reclassification of files), used collective language ("we") consistent with identification with the review team and Company A's project, and Company B's outputs were identified by Company A as its own findings in Decision Notices and the Statement of Case.
- The tribunal concluded these connections created a real risk that Attorney Prestage could not provide an independent, disinterested expert opinion on the outcomes of the file reviews. The relationship also involved financial and employment ties to Company B and a duty to Company B that could conflict with any duty to the tribunal.
- Authorities (Factortame; Armchair; Toth; Rowley) were applied to determine that the existence and degree of the interest/connection required exclusion from giving expert evidence where independence could not be assured; the tribunal distinguished Brendon on the ground that independence concerns may justify exclusion at case-management stage.
- Accordingly, although Attorney Prestage is an expert in the field, the tribunal concluded it would be unfair to admit the Statement as expert evidence because she was conflicted and could not be expected to perform the tribunal-overriding duty of independence.
(B) Late admission as evidence of fact
- The Statement contained factual material about Company B's review process and outputs. The Directions required factual witness statements to be filed by 29 August 2025; the Statement was filed on 11 November 2025.
- The tribunal applied the three-stage test for relief from sanction/extension (Denton; Martland; Medpro): (1) the delay (over three months) was serious and significant; (2) the reason for the delay was Company A's treating the material as expert evidence and the late confirmation of Attorney Prestage's consultancy status; and (3) the balancing exercise considered prejudice to both sides and the overriding objective of fair conduct and proportionality.
- The tribunal accepted Company A would be seriously prejudiced if the Statement were not admitted because no other Company B witness evidence on the review process had been filed; the Appellants were given over two months' notice of the Statement before the substantive hearing.
- The tribunal balanced the seriousness of the delay against Company A's prejudice, the Appellants' ability to respond, and the public interest in efficient resolution. The balance favoured admitting the Statement late as evidence of fact.
- The tribunal rejected the Appellants' submission that the Statement must be amended to remove opinions; it noted that tribunals routinely distinguish factual passages from opinion and that no amended Statement was required.
Other directed matters arising from the analysis included: ordering the sequence of evidence such that factual witnesses and then Company A's statistician (Attorney Purdon) give evidence before any expert evidence; refusing an order requiring Company A to pay for a live transcript; directing the Appellant B to attend in person while giving her evidence; and confirming Attorney Purdon's report had been admitted as expert evidence.
Holding and Implications
Primary Holding: The tribunal held that Attorney Prestage, though qualified, was conflicted and therefore the Statement is excluded as expert evidence.
Secondary Holding: The tribunal granted Company A permission to admit the Statement late as evidence of fact.
Implications: The direct effect is that the Statement may be considered by the tribunal at the substantive hearing only as factual material, not as expert opinion. The tribunal required no revision of the Statement to excise opinion, directed the order of evidence at trial, and confirmed other procedural directions set out in the judgment. The decision is a case-specific case-management ruling applying established authorities on expert independence and the test for late admission of evidence; the judgment did not purport to establish new legal precedent beyond its application of existing principles.
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