I find it odd that a viva external examiner can be a close collaborator of the supervisors. I mean, although they are external on paper, they aren't really. With academia being such a small and political world, how comfortable would you feel assessing fairly the thesis and defense of a student of your colleagues? Key word being fairly. (That's a rhetorical question but you get the point). Any thoughts and experience of this?

My first thought is you are likely to pass with minors!! But on a serious note, the external will be an expert in the field which is probably why they become first port of call for your supervisor. Nothing to worry about.

I know a similar case ended with re-submission. I was not aware of the quality of the PhD thesis submitted but I can see that the collaborator was not "soft" with him. In general cases where someone has to assess the work of a collaborator or his students, it is hard to know the outcome. All possibilities are on the table. He/she might be professional and fair. He/she might be soft. He/she might try to be fair and ending up with being harder than necessary because he/she is afraid of being too spft.

Interesting thoughts - thank you. The funny thing is - I chose her! It was months ago and I didn't really realise the possible implications - I just thought she would be a good person (her work is related) and my supervisors agreed. It was only on reflection that I thought, hmm, how is she going to be impartial? Along the lines of kikothedog, I can't help feeling that she will feel somewhat pressurized not to judge too harshly (i.e., fail/MPhil downgrade even if worthy of such) her close co-workers' (and quite possibly even friends') student's thesis, regardless of its quality (within reason). But on the other hand, she strikes me as a very professional and fair person. So maybe she wouldn't be constrained by politics in her role. Who knows! Funny old world, this academia.