The High Court has rejected Mercer (Ireland) Limited’s application for further and better discovery in its dispute with Irish Airline Pilots Pension DAC, ruling that the agreed document category focused on the decision to sell €40 million of the pension scheme’s global equity holdings on 14 February 2020.
The application concerned Category 2, a discovery category agreed between the parties. It covered documents created from 1 January 2018 to 24 November 2020 concerning discussions and consideration of the decision to realise the shares and hold the proceeds in cash pending investment in infrastructure and long-lease vehicles. It also referred to investment-strategy advice, risk appetite and related deliberations, communications and meeting records.
Mercer argued that the category extended to documents about the scheme’s longer-term investment strategy where that strategy informed the decision to disinvest. Its defence, as described in the judgment, was that the sale followed an existing strategy to diversify away from equities and reduce portfolio risk, rather than an urgent effort to protect gains from a short-term market fall.
The pilots’ claim, as summarised by the court, is that Mercer failed to sell the shares promptly after the decision, causing losses as market valuations fell around the start of the Covid-19 pandemic. Those claims were background to the discovery dispute; the court was not deciding liability or damages in this application.
Mr Justice Twomey said the task was to interpret the agreed category, rather than decide afresh whether a broader category would have been relevant and necessary. He found no ambiguity in its wording. In his view, the investment-strategy documents mentioned in the category were included only insofar as they related to the specific 14 February decision. A separate category for general investment-strategy documents had not been sought and agreed.
The judge said that if no further strategy documents related to that decision, there were no additional documents to disclose under Category 2. He therefore denied Mercer’s application for further and better discovery.
On final orders, the court asked the parties to try to agree outstanding matters without further court time. The case was provisionally listed for mention one week later at 10.45am if needed, with liberty to notify the Registrar if the listing proved unnecessary.