The Court of Appeal has dismissed Promontoria (Aran) Limited’s appeal against an order requiring it to disclose documents about the price it paid for loans acquired from Ulster Bank. The order concerns discovery for the defence of an alternative unjust enrichment claim; it does not decide whether Andrew Sheehy is liable or whether the price will affect the final outcome.
Promontoria claims more than €4.1 million, alleging that loan facilities made by Ulster Bank to Sheehy and two other borrowers were transferred to it with associated security. Sheehy denies liability. He says the money was advanced to the other borrowers, disputes his signature on the 2005 facility letter and denies being party to the 2009 facility letter.
Promontoria also claims, in the alternative, restitution of money allegedly advanced for Sheehy’s benefit. Sheehy disputes that claim and pleads that Promontoria made “no payment of substance” to acquire the loans. He sought documents relating to the amount paid. Promontoria opposed disclosure, citing commercial sensitivity and confidentiality, including information concerning a fourth borrower.
In July 2019, High Court judge Mr Justice Quinn ordered discovery in Category 4, subject to restrictions. Inspection was limited to Sheehy, his solicitor handling the case and counsel, who were required to give undertakings restricting use and disclosure. The order did not determine whether the price paid would be relevant or admissible at trial.
In a judgment delivered on 16 April 2020, Mr Justice Robert Haughton said the price was relevant to a pleaded defence to the alternative claim. He considered it arguable that the amount Promontoria paid could bear on the “expense of the plaintiff” in an unjust enrichment claim. Whether it does so remains for the trial judge to decide. The court also noted that Promontoria’s counsel accepted that the loans were acquired below their par value.
The appeal court acknowledged that the High Court had no sworn evidence setting out the basis for claimed confidentiality or commercial sensitivity. It nevertheless considered those concerns, as the parties had argued the appeal on the assumption that such interests arose. It found that the High Court had balanced them against Sheehy’s interest in a fair hearing and had imposed proportionate restrictions. The trial judge will decide at the full hearing how the material may be used, including whether any part of the trial should be held in camera.
The Court of Appeal held that Promontoria had not shown the High Court was probably wrong or had erred in principle. It dismissed the appeal and affirmed the High Court judgment and order. The underlying claim and defence remain for determination at trial.