Merrill Lynch International v Città Metropolitani Di Milano

Under paragraph 21 of PD57AD, a reference to a missing document does not require production of a different document said to contain identical terms. An unexecuted document cannot be a copy of a later executed document, and the two documents remain distinct even if their substantive terms are assumed to be the same.

The court retains a residual power under CPR 3.1(2)(m), but it must not be used to circumvent the disclosure regime. Limited specific disclosure in a pending jurisdiction challenge requires exceptional circumstances. That threshold was met where the application concerned events more than 20 years old, direct evidence was sparse, and the document was the best available evidence of a material contractual relationship.

The claimant sought negative declaratory relief concerning alleged mis-selling of two interest rate swaps. The defendant had issued a jurisdiction challenge under CPR Part 11. The challenge raised issues concerning the possible application of Italian jurisdiction provisions in an earlier mandate and the place where harmful events occurred under Article 7(2) of the Regulation.

The defendant applied for production of an unexecuted version of an ATI agreement between the claimant and another bank. It relied primarily on paragraph 21 of PD57AD, arguing that the executed ATI had been mentioned in witness evidence and that the unexecuted version was a copy. Alternatively, it relied on the court’s residual power under CPR 3.1(2)(m).

1. Primary ground. The application under paragraph 21 of PD57AD failed. The executed ATI was a document and had been mentioned in the witness evidence. However, the unexecuted ATI had not been mentioned. It was not a “copy” of the executed ATI within Appendix 1 to PD57AD.
2. The definition of “copy” presupposed that the copied document existed previously or concurrently. The unexecuted ATI pre-dated the executed ATI and lacked signatures, and possibly a date required on execution. It therefore did not have identical content in the procedural sense, even though the court assumed for present purposes that the executed ATI had the same substantive terms.
3. A reference to a missing document may engage paragraph 21 without requiring that document to have been deployed substantively. But the regime requires production of a literal copy of the document mentioned, not a different document which may contain equivalent terms.
4. Residual power. The court accepted that CPR 3.1(2)(m) conferred a residual power to order production even where PD57AD did not apply. That power could not be exercised to sidestep the formal disclosure regime. In a pending jurisdiction challenge, limited specific disclosure ordinarily required exceptional circumstances.
5. Exceptional circumstances existed here. The jurisdictional issues concerned events in 2001 and 2002, direct witness and contemporary documentary evidence was limited, and the ATI was the best available evidence of the allocation of responsibilities between the claimant and Dexia. Disclosure would assist analytical integrity and the fair and expeditious determination of the challenge. The order could be made even though the document had not been formally mentioned and might prove adverse to the defendant.
6. The court accordingly rejected the primary ground but granted the alternative application. The claimant was ordered to disclose the unexecuted ATI and the covering email. It could provide focused supplemental factual evidence explaining their context and limitations. Costs were reserved to the judge hearing the jurisdiction challenge.