For solicitors
Part 25 and Practice Direction 25B: what an expert report must contain
Most mortgage capacity reports in circulation are not Part 25 expert reports, and do not need to be. But if one is put forward as expert evidence, it has to meet the Practice Direction — and a good many do not.
By Jonathon Mark Turner CeMAP, Mortgage Capacity Specialist ·
First, is it expert evidence at all?
In the ordinary financial remedy case it is not. Borrowing-capacity material is filed as part of the First Appointment material, jointly obtained where possible, and is not being adduced as expert evidence. In that situation Part 25 is not engaged and PD25B does not apply.
Part 25 is engaged where a party wants to put expert evidence before the court. In financial remedy proceedings that requires the court’s permission, and the court grants it only where the evidence is necessary to assist it to resolve the proceedings — a higher threshold than merely being of assistance. Applications should be made as soon as possible and no later than the First Appointment.
So the first question about any capacity report is not “does it comply with PD25B” but “what is it for”. Only if the answer is “expert evidence, with permission” does the rest of this page apply.
The duties
An expert in family proceedings must:
- help the court on matters within their expertise — and this duty overrides any obligation to the person from whom the expert received instructions or by whom the expert is paid;
- give an opinion that is independent and uninfluenced by whoever instructed them;
- address only questions within their competence, and which are material to the case;
- say so where a question falls outside their expertise, and indicate whether another expert is needed;
- report promptly to those instructing them if their opinion changes.
For a mortgage capacity reporter, the fourth of those is the one most often ignored. Property valuation, pension sharing, tax treatment and questions of law are outside the discipline. An opinion that strays into them is worth less, not more.
The report: a checklist
Practice Direction 25B sets out what an expert’s report must contain. Read against a mortgage capacity report, the requirements come out like this:
| PD25B requires | In a capacity report that means |
|---|---|
| Qualifications and experience | The reporter’s qualification, how long they have worked in the mortgage market, and their experience of reporting for family proceedings — not a firm profile |
| The instructions received, and the documents relied on | An itemised list of every document read, with dates, plus any oral instructions. Instructions to an expert are not privileged |
| The material facts on which the conclusions are based | Income, commitments, dependants, maintenance, term, age, deposit or equity, and the property assumptions — set out, not summarised away |
| Who carried out any test or examination, and their supervision | Whether the affordability modelling was performed by the reporter personally or by someone else on their behalf |
| Answers to the questions the court directed | Each question set out and answered in terms, not addressed by implication in a narrative |
| Assumptions, deductions and any unusual features | Every assumption stated openly, with an indication of which conclusions are sensitive to it |
| A summary of the range of opinion, with reasons | The single most-missed requirement. Lenders do not agree. Reporting one figure without the spread across the market, and without explaining what drives it, does not meet this |
| Any provisional or qualified opinion, and why | Where evidence is missing, say so and say what difference it makes |
| A declaration of no conflict of interest | For a mortgage professional this must be real: no interest in arranging the mortgage, no referral relationship, no commission |
| A statement that the expert understands and has complied with the duty to the court and the Practice Direction | Present, in terms, on the face of the report |
| A statement of truth | In the form the Practice Direction prescribes |
How to check a report you have been sent
Five questions that will tell you most of what you need to know:
- Is there a range of opinion? If the report gives one number and no indication of how lenders differ, ask why. In this discipline a single point figure is almost always a simplification.
- Are the assumptions listed separately from the conclusions? If you have to reverse-engineer the assumptions out of the narrative, neither you nor the other side can test the figure.
- Is there a real conflict declaration? A report written by someone who stands to arrange the resulting mortgage is not independent, whatever the declaration says.
- Does it name a lender or recommend a product? If it does, ask whether the author is authorised to give that advice — and note that it is a different kind of document from the one that was ordered.
- Is it current? Criteria and stress rates move. Check the date on the analysis, not just the date on the covering letter.
Our position
We do not describe ourselves as an expert witness unless and until the court has given permission for expert evidence in the case concerned. Where permission is given — including on a single joint expert appointment — the report is prepared against the checklist above, and we will confirm our qualification, conflict position, fixed fee and availability in writing before the application is made.
This page is a practitioner’s summary, not legal advice, and not a substitute for reading Part 25 and the Practice Directions. Where the position in a particular case matters, read the rules.