UBS Ltd & Anor v Regione Calabria

Under Articles 27 and 28 of the Judgment Regulation, a court is seised only if the relevant national procedural law makes the document effective to institute proceedings. The identity of the defendant and the substance of the claim are construed objectively from the document as a whole. An appearance may cure defects concerning the vocatio in ius retrospectively, but it does not cure a total failure to identify the factual and legal basis of the claim. Related proceedings require a broad assessment of whether hearing them separately creates a risk of irreconcilable judgments. The Article 28 discretion is a value judgment, informed by overlap, governing law and the likely timing of decisions.

Regione Calabria, an Italian public authority, brought proceedings in Italy concerning derivative transactions and an advisory contract involving UBS entities. The Italian summons named a non-existent entity, UBS Warburg AG, although its factual and legal allegations principally identified UBS Limited. UBS Limited and UBS AG subsequently brought separate English proceedings seeking declarations of non-liability.

Calabria applied for the English proceedings to be halted under Articles 27 or 28 of the Judgment Regulation, alternatively under Article 23 because of the jurisdiction clause in the advisory contract. The central issues were whether the Italian court was first seised of valid proceedings against either claimant and, in relation to UBS AG, whether the proceedings were related.

1. UBS Limited. The Italian court was first seised of proceedings against UBS Limited. The summons was objectively construed as a whole. Its factual and legal sections coherently identified UBS Limited as the party allegedly liable under the advisory contract and as counterparty to the transactions, notwithstanding the use of the name UBS Warburg AG in the formal identification, summons and prayer.
2. Service was not invalid under Article 160 of the Italian Code of Civil Procedure because the summons itself sufficiently identified the intended defendant. Nor was the defendant’s identity totally unclear under Article 164[I], or the factual and legal basis of the claim totally unclear under Article 164[IV]. Any defect under Articles 160 or 164[I] would in any event have been cured retrospectively by UBS Limited’s appearance, including its substantive submissions made subject to its jurisdiction objection. Article 164[IV] concerns the editio actionis; an appearance alone does not cure that defect.
3. Those Italian proceedings involved the same causes of action as UBS Limited’s English proceedings. The English claim was therefore stayed under Article 27 of the Judgment Regulation.
4. UBS AG. The summons did not reasonably identify UBS AG as a defendant. Alternatively, any claim against it was totally unclear as to the factual and legal basis, and service was invalid under Articles 160, 164[I] and 164[IV]. The appearance cured the defects under Articles 160 and 164[I], but not the defect under Article 164[IV].
5. The Italian proceedings against UBS Limited and the other banks were nevertheless related to UBS AG’s English proceedings. There was substantial overlap concerning Italian tort obligations, Article 21 of the TUF, the fairness and balance of the transactions, hidden commissions, risk balance, upfront payments and the ISDA Master Agreement. The risk of conflicting decisions was substantial. The Italian court was also best placed to determine the Italian-law issues, and the English-law issues would arise there in any event. UBS AG’s claim was therefore stayed under Article 28. The Article 23 argument was not decided.