Ambra Borgognoni Vimercati v BV Trustco Ltd & Ors

Courts should generally avoid intervening before an expert determination has taken place. The parties have chosen the expert, rather than the court, to decide the substantive valuation issue. The court may intervene at the outset where there is a real and defined dispute about the expert’s jurisdiction or mandate, and resolving it would assist the parties and the expert. Where the agreement specifies no procedure, procedural matters are for the expert, subject to the agreed mandate. The court should not impose joint instructions, representations, documents or procedural safeguards that the agreement does not require. In this case the trustees’ proposed process fell within the expert determination provision, and no sufficiently defined jurisdictional dispute justified intervention.

The claimant was formerly a discretionary beneficiary of the MBV Trust. Under a 2011 appointment, she became entitled to 35% of the net proceeds if the trustees’ underlying company sold its 20% shareholding in Air Italy. The shareholding was sold for an initial consideration, with possible contingent consideration. The claimant disputed the price and invoked a provision requiring a market valuation by an expert appointed by the International Chamber of Arbitration in Milan.

She sought declarations concerning the expert’s status, remit, valuation date, appointment and procedure, together with disclosure and information orders. The central issues were whether the court should intervene before the expert was appointed and whether the appointment provision required joint instructions, representations, particular expertise or specified documents.

1. Overall disposition. The Part 8 action was dismissed. No declarations or disclosure orders were made.
2. The relevant principles were those stated in Jones v Sherwood [1992] 1 WLR 227 (CA), Mercury Communications v Director General of Telecommunications [1994] CLC 1125 (CA), British Shipbuilders v VSEL Consortium PLC [1997] 1 Ll. R. 106 and Barclays Bank PLC v Nylon Capital LLP [2011] EWCA Civ 826. The court should not decide matters entrusted to the expert in advance. It may determine a real, defined dispute about the expert’s jurisdiction where doing so would assist the parties and the expert.
3. The court should not intervene merely because it might prefer a different valuation approach. Under Mercury Communications v Director General of Telecommunications [1994] CLC 1125 (CA), the court’s view of the correct answer is irrelevant where the decision has been entrusted to a valuer. The court may intervene if the expert exceeds the mandate, but an application before the expert’s decision is ordinarily premature.
4. The valuation provision required the trustees to obtain the valuation at the claimant’s expense. Its loose wording concerning reimbursement did not displace that clear allocation. It did not require joint instructions, representations by the claimant, a particular professional expertise, or the provision of specified documents.
5. Because the provision specified no procedure, procedural matters were for the expert. The trustees’ proposed instructions, which would fairly present the parties’ positions and leave the expert to request relevant material, were unobjectionable. The court observed that, given the mistrust between the parties, the trustees would be well advised to present the claimant’s and Gianbenso’s positions fairly and objectively.
6. Disclosure was unnecessary. The Part 8 hearing had concluded, the expert had not been appointed or requested documents, and the claimant’s requests were not required to determine the construction issues. The court also rejected reliance on CPR 31.12, CPR 31.14, CPR 3.1(m), implied terms and the court’s inherent trust jurisdiction.
7. The correct valuation date was the date of the sale contract, namely 28 June 2011. The court nevertheless declined to make declarations because no well-defined dispute requiring advance determination had been shown.