Nationwide Building Society v The Bank of New York Mellon, London Branch & Anor [2025] EWHC 1046 (Comm)

[2025] EWHC 1046 (Comm)

Case No CL-2023-000128

IN THE HIGH COURT OF JUSTICE

BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES

KING'S BENCH DIVISION

COMMERCIAL COURT

Venue Royal Courts of Justice, Rolls Building, Fetter Lane, London, EC4A 1NL

Date 01/05/2025

Before

Sean O'Sullivan KC

Between

NATIONWIDE BUILDING SOCIETYClaimant

(1) THE BANK OF NEW YORK MELLON, LONDON BRANCHDefendants

(2) ALLEN OVERY SHEARMANDefendant

STERLING LLPDefendant

BEN VALENTIN KC (instructed by Travers Smith LLP) for Claimant

LORD GRABINER KC and SIMON GILSON (instructed by Hogan Lovells

International LLP) for First Defendant

SIMON SALZEDO KC and KYLE LAWSON (instructed by Clyde & Co LLP)

for Second Defendant

Hearing Hearing dates: 4 and 5 March 2025, then written submissions 12, 21 and 25 March 2025

Approved Judgment

This judgment was handed down remotely at 1pm on 01 May 2025 by circulation to the parties or their representatives by e-mail and by release to the National Archives.

Sean O’Sullivan KC (sitting as a Deputy High Court Judge):

[1]The background to this dispute is a windfall for HMRC and the UK Treasury. If certain notes issued by the Claimant, Nationwide, as part of its US Medium Term Note Programme in 2018 and 2019, had been listed on the London Stock Exchange, they would have qualified for the quoted Eurobond exemption from withholding tax in s.889 of the Income Tax Act 2007. But, as a result of an oversight, no application for listing was made. As a result, Nationwide faced a substantial tax liability.

[2]This case concerns, in simple terms, responsibility for that oversight. The First Defendant (“BNY”) had various powers and duties in relation to the notes as Trustee and Paying Agent. The Second Defendant (“A&O”) was Nationwide’s lawyer, assisting with aspects of the issue of the notes. Initially, as I will explain, Nationwide had both BNY and A&O in its sights. Now, as a result of some concessions, its guns are aimed only at A&O.

[3]However, the primary issue with which I am concerned is A&O’s Part 20 claim against BNY for a contribution. A&O says that BNY owed a legal duty to Nationwide, either in contract or in tort, to confirm that the notes had been listed and that BNY’s failure to do so gives rise to a liability to provide an indemnity for, or at least a contribution to, any damages which A&O is obliged to pay to Nationwide. BNY says that A&O has no real prospect of succeeding on its allegation that BNY owed such a duty and, on that basis, seeks summary judgment on A&O’s Part 20 contribution claim. There is also a more limited, and contingent, issue about the costs of an application by Nationwide to amend.

[4]Both the background to the dispute and the procedural history are a little involved, so I will say a little about each before turning to the specific issues which arise on the summary judgment application and then the amendment application. The factual background Introduction

The factual background

[5]What follows is not intended to be comprehensive. I have focussed on the parts of the story which seemed to me potentially relevant to the specific issues which I have to decide. Nor should my short narrative be understood as involving any findings of fact; I am deciding a summary judgment application. For the most part, therefore, I am simply recording what I have been told by one or other party.

The Programme in outline

[6]Nationwide’s US Medium Term Note Programme was established in around 2000. I understand it to be a way of raising capital, borrowing money for periods of up to 10 years on the basis of a fixed interest return (or “coupon”), with a fixed redemption date, largely aimed at institutional investors in the US.

[7]A&O acted as US and English law legal adviser to Nationwide from 2006. BNY took over as Trustee and Paying Agent in 2007.

[8]Twenty-four notes were issued between 2009 and 2022 pursuant to the US Medium Term Note Programme. Each series was referred to by the parties by reference to its issue date: so “Series 2018-1” refers to the first series of notes issued in 2018.

[9]The present action concerns Series 2018-1, 2018-2, 2019-1 and 2019-2, all of which were not listed upon issue on the Official List of the UK Listing Authority (i.e. the Financial Conduct Authority), nor admitted to trading on the London Stock Exchange. I will refer to them collectively as “the Unlisted Notes”.

[10]I was shown some of the key documentation which was in place at the time the Unlisted Notes were issued. It is important to understand that there is a high degree of regulation in this regard which is aimed at protecting investors in notes of this kind, despite them not being aimed at “retail” investors. By way of example, it was common ground that EU Directive 2003/71/EC (as amended) applied at the time to require the publication of a prospectus for the issuance of the notes “to enable investors to make an informed assessment of the assets and liabilities, financial position, profit and losses, and prospects of the issuer and of any guarantor, and of the rights attaching to such securities. This information shall be presented in an easily analysable and comprehensible form” (see Article 5(1) of that Directive).

The Base Prospectus

[11]I was shown the “Base Prospectus” dated 20 December 2017, which I understand to have been in place when the 2018-1 and 2018-2 series were issued on 8 March 2018. Although slightly updated versions were in place by the time of issue of each of the 2019-1 and 2019-2 series, it was agreed that the specific terms which I was being shown did not change. The updates concerned the detail of disclosures about Nationwide’s financial position over time, which is not relevant for my purposes.

[12]The overview explained the role of the prospectus:

“This overview highlights important information regarding, but is not a complete description of, our medium-term note program. We urge you to read the remainder of this Base Prospectus where we set out a description of our medium-term note program in more detail. You should also review the applicable Final Terms for additional information about the particular series of notes that you are considering purchasing. The following overview does not purport to be complete and is taken from, and is qualified in its entirety by, the remainder of this Base Prospectus and, in relation to the terms and conditions of any particular tranche of notes, the applicable Final Terms.”

[13]In the opening paragraph of the prospectus, it was stated that an application had been made to list the notes on the LSE and for admission on the FCA’s Official List. The prospectus referred to Nationwide’s covenant to make good any sums it was obliged to withhold or deduct from interest payments, i.e. to pay interest gross: “All payments in respect of the notes will be made without deduction for or on account of United Kingdom withholding taxes, unless the withholding is required by law. In that event, we will (subject to certain exceptions as described in “Terms and Conditions of the Notes–Payment of additional amounts”) pay such additional amounts… as will result in the holder of any notes receiving such amounts as they would have received in respect of the notes had no such withholding been required”.

[14]My attention was drawn by Lord Grabiner KC, Counsel for BNY, to the following provision in the opening part of the prospectus:

“By purchasing the notes, each noteholder (including each beneficial owner) waives any and all claims against The Bank of New York Mellon, London Branch, as trustee, for, agrees not to initiate a suit against the trustee in respect of, and agrees that the trustee will not be liable for, any action that the trustee takes, or abstains from taking, in either case in accordance with the exercise of the UK bail-in power by the relevant UK resolution authority with respect to the notes.”

[15]This was described as a waiver of claims against BNY as Trustee, but I understood it to be accepted by Lord Grabiner that the waiver was only relevant if a “bail-in power” was being exercised by the UK financial authorities, which is not the present case.

[16]In relation to the terms and conditions of the notes, the prospectus explained that:

“This section describes the material terms and provisions of the notes to which any Final Terms may relate. We will describe in each Final Terms the particular terms of the notes that we offer by that Final Terms and the extent, if any, to which the general provisions described below may apply to those notes…. We will offer the notes under an indenture, dated as at December 19, 2017 and as supplemented and amended from time to time (the “Indenture”), between us (the “Issuer”) and The Bank of New York Mellon, London Branch as trustee (the “Trustee”)...”

The Indenture

[17]The Indenture dated 20 December 2017 between Nationwide as Issuer and BNY as both Trustee and Paying Agent applied to the Unlisted Notes. I am told that this, in all material respects, reproduced the provisions of the preceding iterations of the Indenture (dating back to 2000).

[18]Mr Johnson, solicitor for BNY, described the Indenture in his evidence in support of the application as a carefully and professionally drafted document, the purpose of which is to define precisely and exhaustively BNY’s responsibilities as Paying Agent (as well as its separate but equally tightly circumscribed duties as Trustee). There is no doubt that it is a formal document which outlines how the notes are to operate, how they are authenticated, registered, re-issued if lost, how interest is paid and the principal repaid, events of default, early redemption, etc. Lord Grabiner called it a framework document, to which a Supplemental Indenture and some Final Terms were added for each specific series of notes. He said that the sophisticated parties to the Indenture reduced to writing theagreement which had been reached and they also made provision for anyfuture amendments.

[19]In relation to the duties of the Trustee (i.e. BNY), section 6.1 of the Indenture provides as follows:

“Section 6.1 Certain Duties and Responsibilities (a) Except during the continuance of an Event of Default with respect to the Notes of any series for which the Trustee is serving as such, (i) the Trustee undertakes to perform such duties and only such duties as are specifically set forth in this Indenture, and no implied covenants or obligations shall be read into this Indenture against such Trustee; and (ii) in the absence of bad faith on its part, the Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates or opinions furnished to the Trustee and conforming to the requirements of this Indenture; but in the case of any such certificates or opinions which by any provision hereof are specifically required to be furnished to the Trustee, the Trustee shall be under a duty to examine the same to determine whether or not they conform to the requirements of this Indenture. (b) In case an Event of Default with respect to a series of Notes has occurred and is continuing, the Trustee for the Notes of such series shall exercise such of the rights and powers vested in it by this Indenture, and use the same degree of care and skill in their exercise, as a prudent person would exercise or use under the circumstances in the conduct of his or her own affairs. (c) No provision of this Indenture shall be construed to relieve the Trustee for the Notes of any series from liability for its own negligent action, its own negligent failure to act, or its own willful misconduct, except that: (i) this Section (c) shall not be construed to limit the effect of Section (a) of this Section;…” (i) the Trustee undertakes to perform such duties and only such duties as are specifically set forth in this Indenture, and no implied covenants or obligations shall be read into this Indenture against such Trustee; and (ii) in the absence of bad faith on its part, the Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates or opinions furnished to the Trustee and conforming to the requirements of this Indenture; but in the case of any such certificates or opinions which by any provision hereof are specifically required to be furnished to the Trustee, the Trustee shall be under a duty to examine the same to determine whether or not they conform to the requirements of this Indenture.

(a) of this Section;…”

[20]The Indenture also provides for compensation and an indemnity for the Trustee at section 6.6:

“Section 6.6 Compensation and Reimbursement (a) The Issuer will pay to the Trustee for any series of Notes from time to time compensation for its acceptance of this Indenture and services hereunder as shall be agreed from time to time between them in writing. Such Trustee's compensation will not be limited by any law on compensation of a trustee of an express trust. The Issuer will reimburse each such Trustee upon request for reasonable disbursements, advances, charges and expenses incurred or made by it in accordance with any provision of this Indenture except any such expense, disbursement, charge or advance as may be attributable to its negligence or willful misconduct, in addition to the agreed compensation for its services. Such expenses will include the reasonable compensation, disbursements and expenses of the Trustee's agents and counsel and of all Persons not regularly in its employ. (b) The Issuer will indemnify the Trustee for any series of the Notes and its officers, agents, directors and employees, and hold them harmless against any and all losses, liabilities, damages, claims, charges or expenses (including fees and expenses of counsel), including taxes (other than taxes based upon, measured by or determined by the income of such Trustee), properly incurred by it arising out of or in connection with this Indenture, the Notes, the acceptance or administration of its duties under this Indenture, including the costs and expenses of defending itself against any claim (whether asserted by the Issuer, or any Holder or any other Person) or liability in connection with the exercise or performance of any of its powers, trusts or duties hereunder or in connection with enforcing the provisions of this Section, except to the extent any such loss, liability, charge or expense may be attributable to the Trustee’s negligence or willful misconduct. The Trustee will notify the Issuer promptly of any claim for which it may seek indemnity; provided, however, that the Trustee shall not incur any liability it if fails to so notify. Failure by the Trustee to so notify the Issuer will not relieve the Issuer of its obligations hereunder. The Issuer need not pay for any settlement made without its consent, which consent will not be unreasonably withheld.”

[21]It can be seen that this indemnity did not extend to loss or liability “attributable to the Trustee’s negligence”.

[22]Article 8 of the Indenture made detailed provision for what are referred to as “Supplemental Indentures”:

“Section 8.1 Supplemental Indentures Without Consent of Holders Without the consent of any Holders, the Issuer and the Trustee or Trustees for the Notes of any and all series, at any time and from time to time, may enter into one or more indentures supplemental hereto, in form satisfactory to each such Trustee, for any of the following purposes: (a) to evidence the succession of another Person to the Issuer and the assumption by any such successor of the covenants of the Issuer herein and in the Notes; (b) to add to the covenants of any the Issuer for the benefit of the Holders of all or any series of Notes (and if such covenants are to be for the benefit of less than all series of Notes, stating that such covenants are expressly being included solely for the benefit of such series) or to surrender any right or power herein conferred upon the Issuer; (c) to add any additional Events of Default with respect to any or all series of Notes (and, if any such Event of Default applies to fewer than all series of Notes, stating each series to which such Event of Default applies); provided that any such additional Event of Default would not cause any such series of Notes to be in default immediately upon any such addition; (d) to add to or change any of the provisions of this Indenture to such extent as shall be necessary to permit or facilitate the issuance of Notes in uncertificated form or global form, or to permit or facilitate the issuance of extendible Notes; (e) to change or eliminate any of the provisions of this Indenture, provided that any such change or elimination shall become effective only as to the Notes of any series created by such supplemental indenture and Notes of any series subsequently created to which such change or elimination is made applicable by the subsequent supplemental indenture creating such series; (f) to secure the Notes; (g) to establish the form or terms of Notes of any series as permitted by Section 2.1 and Section 3.1; (h) to evidence and provide for the acceptance of appointment hereunder by a successor Trustee with respect to the Notes of one or more series and to add to or change any of the provisions of this Indenture as shall be necessary to provide for or facilitate the administration of the trusts hereunder by more than one Trustee, pursuant to the requirements of Section 6.10(b); (i) to cure any ambiguity or defect, to correct or amend or supplement any provision herein which may be inconsistent with any other provision herein, or to make any other provisions with respect to matters or questions arising under this Indenture, provided such action does not have a materially adverse effect on the rights of the Holders of Notes of any series; (j) to modify, alter, amend or supplement this Indenture in any other respect which does not have material adverse effect on the rights of Notes of any series; or (k) to modify and amend the terms of this Indenture or the Notes to the extent necessary to give effect to the exercise by the relevant UK Resolution Authority of the UK Bail-in Power, including each and every consequences arising therefrom referred to in Section 13.1. Section 8.2 Supplemental Indentures with Consent of Holders The Issuer and the Trustee or Trustees for the Notes of any or all series may enter into an indenture or indentures supplemental hereto for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of this Indenture or of modifying in any manner the rights of the Holders of such Notes under this Indenture, but only with the consent of the Holders of not less than a majority in aggregate principal amount of the Outstanding Notes of each series of Notes then Outstanding affected thereby, in each case by Act of said Holders of Notes of each such series delivered to the Issuer and the Trustee for Notes of each such series; provided, however, that no such supplemental indenture shall, without the consent of the Holder of each Outstanding Note affected thereby: (i) change the Stated Maturity of the principal of, or any installment of principal of or interest on, any Note, or reduce the principal amount thereof or the rate of interest thereon, if any, or any premium or principal payable upon the redemption thereof, or change any obligation of the Issuer to pay Additional Amounts (except as contemplated by Section 7.1(a) and permitted by Section 8.1(a)) or reduce the amount of the principal of a Note that would be due and payable upon a declaration of acceleration of the Maturity thereof pursuant to Section 5.2 or Section 5.3, as applicable, or change any Place of Payment where, or change the currency or currency unit in which, any Note or any interest thereon is payable, or impair the right to institute suit for the enforcement of any such payment on or after the Stated Maturity thereof or the date any such payment is otherwise due and payable (or, in the case of redemption, on or after the Redemption Date); or (ii) reduce the percentage in aggregate principal amount of the Outstanding Notes of any particular series, the consent of whose Holders is required for any such supplemental indenture, or the consent of whose Holders is required for any waiver (of compliance with certain provisions of this Indenture or certain defaults hereunder and their consequences) provided for in this Indenture; or (iii) change any obligation of the Issuer to maintain an office or agency in the places and for the purposes specified in Section 9.2; or (iv) modify any of the provisions of this Section or Section 5.14 or Section 9.7 except to increase any specified percentage in aggregate principal amount required for any actions by Holders or to provide that certain other provisions of this Indenture cannot be modified or waived without the consent of the Holder of each Note affected thereby; provided, however, that this Section shall not be deemed to require the consent of any Holder of a Note with respect to changes in the references to “the Trustee” and concomitant changes in this Section and Section 5.14 or Section 9.7, or the deletion of this proviso, in accordance with the requirements of Section 6.10(b) and Section 8.1(h); or (v) with respect to any Subordinated Notes or Senior Non-Preferred Notes, change in any manner adverse to the interests of the Holders of any Outstanding Subordinated Notes or Outstanding Senior Non-Preferred Notes the subordination or ranking provisions, respectively, of such Subordinated Notes or Senior Non-Preferred Notes. A supplemental indenture which changes or eliminates any covenant or other provision of this Indenture which has expressly been included solely for the benefit of one or more particular series of Notes, or which modifies the rights of the Holders of Notes of such series with respect to such covenant or other provision, shall be deemed not to affect the rights under this Indenture of the Holders of Notes of any other series. It shall not be necessary for any Act of Holders under this Section to approve the particular form of any proposed supplemental indenture, but it shall be sufficient if such Act shall approve the substance thereof… Section 8.4 Execution of Supplemental Indentures In executing, or accepting the additional trusts created by, any supplemental indenture permitted by this Article or the modifications thereby of the trusts created by this Indenture, the Trustee shall be entitled to receive, and (subject to Section 6.1) shall be fully protected in relying upon, an Officer’s Certificate and an Opinion of Counsel each stating that the execution of such supplemental indenture is authorized or permitted by this Indenture and an Opinion of Counsel to the effect that such supplemental indenture is enforceable against the Issuer in accordance with its terms, subject to then customary exceptions. The Trustee for any series of Notes may, but shall not (except to the extent required in the case of a supplemental indenture entered into under Section 8.1(h)) be obligated to, enter into any such supplemental indenture which affects such Trustee’s own rights, duties or immunities under this Indenture or otherwise. Section 8.5 Effect of Supplemental Indentures Upon the execution of any supplemental indenture under this Article, this Indenture shall be modified in accordance therewith, and such supplemental indenture shall form a part of this Indenture for all purposes; and every Holder of Notes theretofore or thereafter authenticated and delivered hereunder shall be bound thereby. Section 8.6 Reference in Notes to Supplemental Indentures Notes of any series authenticated and delivered after the execution of any supplemental indenture pursuant to this Article may, and shall if required by the Trustee, bear a notation in form approved by the Trustee as to any matter provided for in such supplemental indenture. If the Issuer shall so determine, new Notes of any series so modified as to conform, in the opinion of the Trustee for the Notes of such series and the Issuer to any such supplemental indenture may be prepared and executed by the Issuer and such Notes may be authenticated and delivered by the Trustee in exchange for Outstanding Notes of such series.”

Section 8.2 Supplemental Indentures with Consent of Holders Section 8.4 Execution of Supplemental Indentures Section 8.5 Effect of Supplemental Indentures Section 8.6 Reference in Notes to Supplemental Indentures

[23]I will say more about these provisions in due course, but for now note that section 8.1(g) permits a Supplemental Indenture to be used “to establish the form or terms of Notes of any series”.

[24]The Indenture is governed by New York law (see section 1.10), but the parties confirmed to me that no-one was relying upon anything other than English law.

S&CAs

[25]I will describe the email exchanges about the signing and closing agendas (or “S&CAs”) in relation to the Unlisted Notes in more detail in a later section of this judgment. However, by way of introduction, I note that S&CAs were produced in relation to each of the 24 series of notes that were issued between 2009 and 2022. The agendas were not identical, but might be said to have followed a consistent format, identifying tasks or matters that needed to “take place” or “be attended to”for each issuance. In relation to some tasks or matters, the S&CAs allocated responsibility to one or more of the parties.

[26]Clause 2.4 of each of the relevant S&CAs stated that, prior to closing, “All necessary documents to have been lodged with the Stock Exchange and confirmation of listing and trading … to have been obtained”.

[27]Then, clause 4.1 of each of the relevant S&CAs, under the sub-heading “Post Closing Matters”, stated as follows:

“Confirmation to be given to the UKLA and the Stock Exchange that Closing has taken place and the Issuer and Paying Agent to confirm that the Notes have been listed on the Official List and admitted to trading on the Stock Exchange”

Final Terms

[28]At the same time as exchanging comments on the S&CAs, the parties agreed Final Terms for each of the Unlisted Notes. I was shown the version for Series 2018-1 in order to understand the format. I did not understand that anything turned on the content of the terms.

[29]The Final Terms set out in each case the specific terms applying to that series of notes, in a predefined format. For example, the fixed, and then floating, rates of interest and the dates for payment were given. The Final Terms document was signed (twice) on behalf of Nationwide.

First Supplemental Indenture

[30]I was told that there was also, in each case, a Supplemental Indenture, formally establishing the series of notes, and setting out some key terms, such as the maturity dates, rates of interest, etc.

[31]Section 3.1 of the Supplemental Indenture was an entire agreement clause:

“This Supplemental Indenture constitutes the entire agreement of the parties hereto with respect to the amendments to the Base Indenture set forth herein”

Failure to list discovered

[32]In January 2023, Nationwide discovered that three series of notes had been issued but not listed (series 2018-1, 2018-2 and 2019-2). BNY was asked to list those notes belatedly, but that proved to be too late to avoid tax liability. In December 2023, Nationwide discovered that a fourth series had not been listed in the period prior to its redemption (2019-1).

[33]HMRC requested Nationwide to submit amended tax returns and to pay the withholding tax in relation to these Unlisted Notes. I was told that £83,489,827.34 was recently paid by Nationwide to HMRC in respect of the tax owing, with penalties and late payment interest apparently still to be imposed.

[34]There was at one stage uncertainty as to whether BNY, allegedly the party by whom or through whom the interest was paid, might be the entity assessed by HMRC for withholding tax. BNY took the position that, if it was required to make any such payment, it would be entitled to an indemnity from Nationwide pursuant to the Indenture (see paragraph 20 above). That was not the route ultimately taken by HMRC and hence that aspect of the dispute about the indemnity has fallen away. Procedural history Pre-action correspondence

Procedural history

[35]Once the problem came to light, there was correspondence between Nationwide, A&O and BNY about responsibility for the failure to list the Unlisted Notes. Initially, Nationwide asserted that BNY had been the listing agent for Nationwide. See, for example, the letter before action from Travers Smith (for Nationwide) dated 6 April 2023.

Nationwide’s claim

[36]When formal proceedings were commenced, however, Nationwide’s claim against BNY was more cautiously expressed.

[37]It was pointed out that, in respect of some earlier series of notes, BNY had taken on the task of making the application to list. This was common ground, with BNY acknowledging that it had done so, but saying that this had always been following a clearly documented request from Nationwide or A&O.

[38]On this basis, however, Nationwide alleged in its Particulars of Claim that, if BNY had been instructed to file an application to admit a particular series of notes to the Official List and to trade on the LSE, then BNY owed Nationwide a duty to do so and to confirm that listing/admission had taken place. Nationwide did not claim to have any direct evidence that either it or A&O had given any such instruction in relation to any of the Unlisted Notes. It suggested that it could be inferred that this had occurred.

A&O’s Part 20 Claim

[39]In its Defence, A&O did not allege that it had given any such instruction to BNY either. However, it did contend that paragraph 4.1 of the relevant S&CAs imposed or evidenced a legally enforceable duty owed by BNY to Nationwide to confirm (alternatively, to exercise reasonable skill and care to confirm) that listing had taken place. On that basis, A&O claimed a contribution from BNY to any liability which A&O was found to have to Nationwide because of the failure to list.

Summary judgment application

[40]BNY applied for summary judgment against both Nationwide and A&O.

[41]In relation to Nationwide’s claim, BNY’s justification for the application was that there was no factual basis for alleging that BNY was requested or instructed to list the notes. On 17 September 2024, Nationwide said it would not put in evidence or oppose reverse summary judgment on its claim against BNY and, if BNY also succeeded on summary judgment against A&O, Nationwide would not oppose summary judgment on BNY’s counterclaim pursuant to its contractual indemnity in the Indenture. In effect, therefore, Nationwide dropped its claims against BNY.

[42]In relation to A&O’s contribution claim, the summary judgment application remained effective, at least in relation to the allegation that paragraph 4.1 of the relevant S&CAs imposed or evidenced a legally enforceable duty. That was the issue which took up the lion’s share of the written and oral submissions made to me.

Nationwide’s application to amend

[43]Nationwide has not adopted A&O’s argument about paragraph 4.1 of the S&CAs as a freestanding basis for a claim against BNY for damages. Its only importance, as between Nationwide and BNY, is said to be that, if A&O succeeds on its contribution claim, BNY would not be entitled to an indemnity from Nationwide in respect of any damages which have to be paid, because those damages would be “attributable to the Trustee’s negligence” (see Section 6.6(b) of the Indenture).

[44]This defence to an indemnity is to be added by amendment to the Reply (strictly, it probably should have been only in the Defence to Counterclaim). There is no longer any dispute about whether, if the summary judgment application fails and the point remains live, Nationwide should be permitted to make that amendment. There is, however, a short point about the costs of that application, which I will address at the end of this judgment. Summary judgment Introduction

Summary judgment

[45]I repeat that the summary judgment application is now only concerned with A&O’s claim for a contribution from BNY. To be more precise, in its Amended Defence and Particulars of Part 20 Claim (paragraph 15), A&O says that: “By approving the terms of the relevant S&CAs in respect of each of the Unlisted Notes, BONY thereby undertook an obligation to Nationwide in contract and/or in tort to (alternatively to use reasonable skill and care to) confirm promptly after Closing that a Listing/Admission Application had been made and that the relevant notes had been listed on the Official List and admitted to trading on the London Stock Exchange…”.

[46]A&O referred to that as the “Confirmation Duty”. I draw attention to the fact that there is said to have been a contract (between Nationwide and BNY) and/or a tortious duty (owed by BNY to Nationwide).

[47]BNY made much of the fact that Nationwide, the party to whom the duty is allegedly owed, denies this argument and has declined to pursue it, even in the alternative (save on a wholly contingent basis). BNY says that suggests that the argument is legally and commercially a bad one.

[48]In the end, of course, that is only a forensic point. Nationwide’s view cannot affect the strength or weakness of the argument. Mr Salzedo KC, Counsel for A&O, suggested that the forensic point was of limited force here, because it did not really suit Nationwide for the Court to conclude that paragraph 4.1 of the S&CAs amounted to a binding obligation to confirm that the notes had been listed, since paragraph 4.1 suggested it was for both “the Issuer and Paying Agent” (i.e. BNY and Nationwide) to do so.

The test

[49]There was no real dispute about the test for summary judgment.

[50]The test was encapsulated recently by Henshaw J in Nederlandse Financierings-Maatschappij Voor Ontwikkelingslanden NV v Société Bengaz SA

[2024] EWHC 901 (Comm)

at [71]-[72]:

“71. Under CPR 24.3, the court may give summary judgment “against a claimant or defendant on the whole of the claim or on an issue if — (a) it considers that the party has no real prospect of succeeding on the claim, defence or issue; and (b) there is no other compelling reason why the case or issue should be disposed of at a trial”. 72. In The LCD Appeals (Iiyama (UK) Ltd and others v Samsung Electronics Co Ltd and others) [2018] EWCA Civ 220, the Court of Appeal approved the following considerations applicable to summary judgment applications, taken from passages in Easyair Ltd v Opal Telecom Ltd [2009] EWHC 339 (Ch) and Swain v Hillman [2001] 1 All ER 91 at 94. I state them below in a form applicable equally to applications by claimants and applications by defendants: i) the court must consider whether the respondent has a “realistic” as opposed to a “fanciful” prospect of success: Swain v Hillman [2001] 1 All ER 91; ii) a “realistic” claim or defence is one that carries some degree of conviction. This means a claim or defence that is more than merely arguable: ED & F Man Liquid Products v Patel [2003] EWCA Civ 472 § 8; iii) in reaching its conclusion the court must not conduct a “mini-trial”: Swain v Hillman; iv) this does not mean that the court must take at face value and without analysis everything that a respondent says in his statements before the court. In some cases it may be clear that there is no real substance in factual assertions made, particularly if contradicted by contemporaneous documents: ED & F Man Liquid Products v Patel § 10; v) however, in reaching its conclusion the court must take into account not only the evidence actually placed before it on the application for summary judgment, but also the evidence that can reasonably be expected to be available at trial: Royal Brompton Hospital NHS Trust v Hammond (No 5) [2001] EWCA Civ 550; vi) although a case may turn out at trial not to be really complicated, it does not follow that it should be decided without the fuller investigation into the facts at trial than is possible or permissible on summary judgment. Thus the court should hesitate about making a final decision without a trial, even where there is no obvious conflict of fact at the time of the application, where reasonable grounds exist for believing that a fuller investigation into the facts of the case would add to or alter the evidence available to a trial judge and so affect the outcome of the case: Doncaster Pharmaceuticals Group Ltd v Bolton Pharmaceutical Co 100 Ltd [2007] FSR 3; vii) on the other hand, it is not uncommon for an application under Part 24 to give rise to a short point of law or construction and, if the court is satisfied that it has before it all the evidence necessary for the proper determination of the question and that the parties have had an adequate opportunity to address it in argument, it should grasp the nettle and decide it. If it is possible to show by evidence that although material in the form of documents or oral evidence that would put the documents in another light is not currently before the court, such material is likely to exist and can be expected to be available at trial, it would be wrong to give summary judgment because there would be a real, as opposed to a fanciful, prospect of success. However, it is not enough simply to argue that the case should be allowed to go to trial because something may turn up which would have a bearing on the question of construction: ICI Chemicals & Polymers Ltd v TTE Training Ltd [2007] EWCA Civ 725; and viii) a judge in appropriate cases should make use of the powers contained in Part 24. In doing so, he or she gives effect to the overriding objective as contained in Part 1. It saves expense; it achieves expedition; it avoids the court’s resources being used up on cases where this serves no purpose; and it is in the interests of justice. If the respondent has a case which is bound to fail, then it is in their interests to know as soon as possible that that is the position: Swain v Hillman [2001] 1 All ER 91 § 94.” i) the court must consider whether the respondent has a “realistic” as opposed to a “fanciful” prospect of success: Swain v Hillman [2001] 1 All ER 91; ii) a “realistic” claim or defence is one that carries some degree of conviction. This means a claim or defence that is more than merely arguable: ED & F Man Liquid Products v Patel [2003] EWCA Civ 472 § 8; iii) in reaching its conclusion the court must not conduct a “mini-trial”: Swain v Hillman; iv) this does not mean that the court must take at face value and without analysis everything that a respondent says in his statements before the court. In some cases it may be clear that there is no real substance in factual assertions made, particularly if contradicted by contemporaneous documents: ED & F Man Liquid Products v Patel § 10; v) however, in reaching its conclusion the court must take into account not only the evidence actually placed before it on the application for summary judgment, but also the evidence that can reasonably be expected to be available at trial: Royal Brompton Hospital NHS Trust v Hammond (No 5) [2001] EWCA Civ 550; vi) although a case may turn out at trial not to be really complicated, it does not follow that it should be decided without the fuller investigation into the facts at trial than is possible or permissible on summary judgment. Thus the court should hesitate about making a final decision without a trial, even where there is no obvious conflict of fact at the time of the application, where reasonable grounds exist for believing that a fuller investigation into the facts of the case would add to or alter the evidence available to a trial judge and so affect the outcome of the case: Doncaster Pharmaceuticals Group Ltd v Bolton Pharmaceutical Co 100 Ltd [2007] FSR 3; vii) on the other hand, it is not uncommon for an application under Part 24 to give rise to a short point of law or construction and, if the court is satisfied that it has before it all the evidence necessary for the proper determination of the question and that the parties have had an adequate opportunity to address it in argument, it should grasp the nettle and decide it. If it is possible to show by evidence that although material in the form of documents or oral evidence that would put the documents in another light is not currently before the court, such material is likely to exist and can be expected to be available at trial, it would be wrong to give summary judgment because there would be a real, as opposed to a fanciful, prospect of success. However, it is not enough simply to argue that the case should be allowed to go to trial because something may turn up which would have a bearing on the question of construction: ICI Chemicals & Polymers Ltd v TTE Training Ltd [2007] EWCA Civ 725; and viii) a judge in appropriate cases should make use of the powers contained in Part 24. In doing so, he or she gives effect to the overriding objective as contained in Part 1. It saves expense; it achieves expedition; it avoids the court’s resources being used up on cases where this serves no purpose; and it is in the interests of justice. If the respondent has a case which is bound to fail, then it is in their interests to know as soon as possible that that is the position: Swain v Hillman [2001] 1 All ER 91 § 94.”

[51]In TFL Management Ltd v Lloyds Bank Plc

[2013] EWCA Civ 1415

, the Court of Appeal referred to the familiar formulation of those principles in Easyair and added (at [27]):

“…the court should still consider very carefully before accepting an invitation to deal with single issues in cases where there will need to be a full trial on liability involving evidence and cross-examination in any event, or where summary disposal of the single issue may well delay, because of appeals, the ultimate trial of the action: see Potter LJ in Partco Group Ltd v Wragg [2002] 2 Lloyd’s Rep 343, para 27(3) and cases there cited. Removing road blocks to compromise is of course one consideration, but no more than that. Moreover, it does not follow from Lewison J’s seventh principle that difficult points of law, particularly those in developing areas, should be grappled with on summary applications: see Partco Group Ltd v Wragg, para 28(7). Such questions are better decided against actual rather than assumed facts. On the other hand it may be possible to say that the trajectory of the law will never on any view afford a remedy: see for example Hudson v HM Treasury [2003] EWCA Civ 1612.”

The facts

[52]I have already indicated that it was common ground that BNY had been involved in applying for some earlier notes to be listed. For example, in relation to the 2009-1 and 2009-2 series, Mr Johnson’s evidence was that these were submitted to the LSE by BNY. He said that BNY’s involvement followed an exchange between Francine Kincaid of BNY and Adam Kupitz and Antonia Eliason of A&O between 6 and 12 August 2009, in which Mr Kupitz asked for BNY’s assistance listing the notes on the LSE and Ms Kincaid responded that BNY “will handle listing these bonds on LSE”.On 14 August 2009, A&O submitted an executed “Form 1” to the LSE and referred to the Final Terms having been provided the day before by BNY.

[53]There was similar evidence about some (but not all) of the notes issued in 2010, 2015 and 2018 (series 2018-3). I understood it to be accepted by Lord Grabiner that, where BNY had positively been asked to perform a role in that regard, and had agreed to do so, BNY could not say “well, I've agreed to do it but I'm not bound to do it”, even though there was no signed contract and BNY would not receive any additional remuneration.

[54]The most important facts for the purposes of the summary judgment application concerned the production/ finalisation of the S&CAs for each of the Unlisted Notes.

[55]A&O’s Further Information dated 5 March 2024 alleged that contracts were made between BNY and Nationwide “partly in writing and/or by conduct and/or by an exchange of emails”. It identifies 13 emails by which A&O contends these four contracts were formed, on the basis that, by failing to raise any objections or amendments to the final versions of the S&CAs, BNY “impliedly and/or by its conduct” agreed the terms of the four contracts.

[56]Looking at the emails relating to Series 2018-1 and Series 2018-2, on 1 March 2018, Mr Kupitz of A&O indicated in an email to BNY and its lawyers, Bryan Cave, that Nationwide was pricing two issuances. On 2 March 2018, a representative of BNY asked whether Mr Kupitz had “a draft Signing & Closing Agenda to hand”. Mr Salzedo pointed out that the first thing this representative of BNY asked was about the S&CAs, which suggested that they were thought to be of legal significance.

[57]A&O circulated a draft S&CA later the same day, together with a draft of the Final Terms. This email was sent to a large number of recipients (perhaps around 40 people), including both lawyers and their principals.

[58]The draft S&CA envisaged 4 stages: signing, matters to be attended before the closing date, closing and finally, post closing. I will not set out the whole document, but it may assist the reader to get the flavour of it if I quote from the first section: “1 Signing1.1 The following matters are to take place on or prior to the Signing Date:

(a) Settlement Agent to obtain ISIN and CUSIP numbers from the Trustee and send to LL and A&O;

(b) Terms Agreement to be prepared by A&O and in agreed form;

(d) Final Terms to be prepared by A&O and in agreed form;

(e) Pricing Term Sheet to be prepared by Placement Agents and LL and in agreed form;

(f) Form of PwC’s US Comfort Letter to be in agreed form;

(g) Forms of PwC’s Non-US Comfort Letter and Arrangement Letter to be in agreed form;

(h) Forms of PwC’s US and Non-US Bring-Down Comfort Letters to be in agreed form;

(i) Pre-pricing bring-down due diligence call to take place on February 28, 2018 at 12.45 pm London time.

1.2 Pricing Term Sheet to be completed and circulated to all parties on the Signing Date.

1.3 The Terms Agreement and the Letter of Accession to be executed by the Issuer and the Placement Agents and signature pages to be signed and delivered to A&O via email on the Signing Date.

1.4 PwC’s Non-US Arrangement Letter to be executed by PwC, the Issuer and the Placement Agents and signature pages to be signed and delivered to PwC via email on the Signing Date.

1.5 PwC to deliver a US and Non-US Comfort Letter to the Placement Agents and LL on the Signing Date.” (a) Settlement Agent to obtain ISIN and CUSIP numbers from the Trustee and send to LL and A&O; (b) Terms Agreement to be prepared by A&O and in agreed form; (c) Letter of Accession under the Private Placement Agency Agreement to be prepared by A&O and in agreed form; (d) Final Terms to be prepared by A&O and in agreed form; (e) Pricing Term Sheet to be prepared by Placement Agents and LL and in agreed form; (f) Form of PwC’s US Comfort Letter to be in agreed form; (g) Forms of PwC’s Non-US Comfort Letter and Arrangement Letter to be in agreed form; (h) Forms of PwC’s US and Non-US Bring-Down Comfort Letters to be in agreed form; (i) Pre-pricing bring-down due diligence call to take place on February 28, 2018 at 12.45 pm London time.

[59]One version of the draft S&CA sent by A&O in that email contained tracked changes, which I understood to show a comparison against the wording of the agenda for the issuance of the previous issue of notes. I have ignored the tracking for present purposes and treated the changes as having been implemented.

[60]I will also set out paragraphs 3 and 4 of these S&CAs in full, because they were the subject of most of the argument:

“3 Closing All transactions at the Closing will be deemed to take place simultaneously and no delivery or payment is to be deemed to have been made until all the transactions to be made at the Closing have been completed. 3.1 The Supplemental Indenture relating to the Notes, including the forms of the Notes, to be signed by the Issuer and the Trustee. 3.2 The documents listed in Section 1.1 (g) and 2.2 (a) through (e) hereof to be executed and delivered to the Placement Agents and Trustee. 3.3 The Issuer to deliver (i) the Global Notes signed by its officers and to instruct the Trustee to authenticate and deliver such Global Notes and (ii) counterparts of the Supplemental Indenture and to instruct the Trustee to execute such counterparts (as per Appendix 2) and (iii) a letter of instruction for payment to the Paying Agent to be made to the Issuer on the Closing Date (as per Appendix 3). 3.4 The Trusteeto acknowledge receipt of the Issuer’s authentication instruction and Global Notes and authenticate the Global Notes in accordance with the Issuer’s authentication instruction. 3.5 The Paying Agent to make payment in accordance with the payment instructions delivered to it by the Issuer. 4 Post Closing Matters Confirmation to be given to the UKLA and the Stock Exchange that Closing has taken place and the Issuer and Paying Agent to confirm that the Notes have been listed on the Official List and admitted to trading on the Stock Exchange. 4.1 Conformed copies of the Final Terms and bibles for the transaction to be prepared by LL and distributed via email to the Placement Agents, A&O and the Issuer.”

[61]The draft S&CA also attached 3 draft appendices. These appendices included the two letters of instruction to BNY (as Trustee and as Paying Agent) referred to in paragraph 3.3 above.

[62]On 5 March 2018, Nationwide responded to A&O to make some small points about the content of the Final Terms. It was made clear that there were no comments on the draft S&CA.

[63]At 0101hrs on 6 March 2018, BNY’s solicitors circulated a mark-up of the S&CA. No amendments were proposed to paragraph 4. At 1008hrs on 6 March 2018, a representative of BNY emailed the other parties and confirmed that BNY had “no comments” on the draft S&CA.

[64]At 1951hrs on 6 March 2018, the solicitors for the Placement Agents circulated a further draft of the S&CA with “a few tidy-up points” (e.g. tidying up the paragraph numbering, including making the paragraph with which we are currently concerned into paragraph 4.1).

[65]At 2110hrs on 6 March 2018, A&O circulated clean and blackline versions of the S&CAs to the other parties, reflecting the comments received. The relevant notes (Series 2018-1 and Series 2018-2) were then issued on 8 March 2018.

[66]I was shown a similar set of emails for the other Unlisted Notes. In each case, there were emails in which BNY’s solicitors marked up the draft S&CA, but without making any comment or change to the text of what was clause 4 above.

[67]An example of the way the process would conclude can be seen in the email of 25 April 2019 from A&O to Dan Chant at BNY, copied to various people at Nationwide and at Bryan Cave:

“Please find the executed final terms and S&CA attached. Also attached as a pdf is the signature page for Appendix 2 (Letter of Instruction to the Trustee); can you please have this page signed and sent back to us to hold in escrow until closing? You'll note that the settlement agent is given as Citigroup in the pdf of Appendix 2, but blobbed in the S&CA. This is because Linklaters has informed us that the settlement agent will not be Citi. If you know who the settlement agent will be (and what their DTC participant number is), please let us know, as that would allow us to fill in the blobs on pp. 1 and 6 of the S&CA (and correct Appendix 2). Also attached is the Supplemental Indenture reflecting helpful comments from Bryan Cave. This is still undergoing minor technical changes but in the interest of time we would appreciate if you could arrange to have it signed in the relevant places (i.e., both the Si itself and both Reg S and 144A notes) and revert to us to hold in escrow until closing. For good order we will circulate finalized versions of all the docs before closing. Please feel free to be in touch with questions.”

[68]Lord Grabiner contended that the communications between the parties will have been the subject of a high degree of scrutiny, on all sides, for the purposes of considering whether they shed any light on responsibility for listing the notes. It seems to me that he is right to say that there is no sign of any gaps in the documentary record.

[69]Lord Grabiner submitted that, as a result, I am in as good a position as the trial judge to decide issues about the existence of contracts or tortious duties. To the extent that amounts to an invitation to conduct a mini-trial, or to decide factual issues “on the papers”, I must refuse it. But to the extent that I form the view that the case being advanced by A&O has no real prospect of success, I agree that A&O cannot escape from that conclusion by implying that their case might be transformed by disclosure or witness evidence; that something might turn up. That is the approach which Mr Micawber adopted to his problems in David Copperfield, but, while unfounded optimism worked out well (in the end) for Wilkins Micawber, it is not available in England to respondents to applications for summary judgment.

BNY’s submissions in outline

[70]In relation to the contractual case, BNY’s primary argument was that A&O had no real prospect of demonstrating that the S&CAs had any contractual effect.

[71]The issue is whether Nationwide and BNY are to be taken to have intended that paragraph 4.1 of each S&CA would amount to a legally binding obligation. BNY reminded me that whether an exchange is intended to create contractual relations falls to be assessed objectively, by looking at what happened against the background of the factual matrix. Lord Grabiner submitted that it is not seriously arguable that this was the parties’ intention.

[72]He added orally that “For good measure, there's no consideration and the alleged agreement is not sufficiently certain or complete to be enforceable”, but subsequently made clear that he was not raising absence of consideration or certainty as freestanding points. Indeed, he told me that he could not remember a single case from his career in which the point on which everything turned was whether or not there had been consideration for a promise. It seemed to me that he was right not to waste time on those matters.

[73]Lord Grabiner contended that the S&CAs are exactly what they purport to be: agendas which set out a timetable, closing steps and various deliverables from a wide range of entities, prepared by a City law firm purely as an organisational tool.

[74]A series of points were made about the form of the S&CAs themselves, including that: 74.1. the agenda items concern a range of documents, information, confirmations and payments of the kind required for the purposes of a capital markets transaction; 74.2. they do not include the type of duty-imposing language, such as ‘shall’ or ‘will’, which is typically found in a contract. Instead, the agenda items are expressed either in the form ‘A to do X’ or, in the passive voice, ‘Y to be done’, without ascribing the responsibility for undertaking the step to any named party; 74.3. more generally, the language of the S&CAs is vague and imprecise and inconsistent with an intention that they should be legally binding documents; 74.4. the agendas were not signed. They contain no signature blocks or other provision for the parties to sign; 74.5. there are none of the usual provisions or formalities one would expect to find in a contract entered into between sophisticated financial institutions, drafted by specialist legal advisers such as A&O, such as provisions dealing with governing law, jurisdiction, termination, or any conflict with provisions of the Indenture or other contractual documents governing the transaction; and 74.6. the versions of the S&CAs which A&O allege constitute the final agreements contain other markers of informality. The 2018-1 and 2018-2 S&CAs were marked as “draft” in the headers. The 2019-1 and 2019-2 S&CAs contained square brackets and placeholders denoting incompleteness.

[75]BNY made much of the fact that the agenda items include actions on the part of A&O, the various Placement Agents (involving different combinations of Barclays, BNP Paribas, Citi, Fenner & Smith, JP Morgan, Merrill Lynch, Morgan Stanley, NatWest, Pierce and UBS), Nationwide, Linklaters (as legal advisers to the Placement Agents), PwC (as Nationwide’s auditors), the Settlement Agent (not always clarified, but usually BNP Paribas) and BNY (as Trustee and Paying Agent). BNY pointed out that, on A&O’s case, these other entities (or at least those copied in the email chains) must have also been parties to these supposed contracts. BNY suggested that these various entities would have been very surprised to learn this.

[76]Staying with the documents, BNY contended that there was nothing in the emails to suggest they concerned the formation of a new contract. It was said that they merely involved an exchange of drafts and comments on an organisational agenda, amongst discussion with a range of entities. There was no suggestion in the emails that A&O was purporting to contract for Nationwide. BNY contended that, although Nationwide was copied on the email exchanges, the emails on which A&O actually relies were between its debt capital market associates and the operational staff at BNY.

[77]BNY also relied upon the wider context. It was submitted that: 77.1. Nationwide and BNY had reduced their respective obligations to a formal written Indenture, revised and re-executed in 2017, whose terms are exclusive, with prescribed formalities for variation via execution of a Supplemental Indenture. 77.2. for each series of the Unlisted Notes, a Supplemental Indenture was in fact prepared and formally executed, which varied the Indenture in certain respects (but did not say anything about any duty in relation to confirming that notes had been listed); 77.3. each Supplemental Indenture for the Unlisted Notes contained an entire agreement provision (at section 3.8). BNY argued that the parties’ inclusion of the entire agreement clause in the Supplemental Indentures negatived any intent to create legal relations; 77.4. drafts of the Supplemental Indentures were circulated in the same email chains as drafts of the S&CAs. It is perfectly obvious that the Supplemental Indentures were intended to have contractual force. The S&CAs must have been intended as something different.

[78]By way of alternative, BNY argued that, if intention to contract could be established, the intended contracts would still be ineffective because of non-compliance with Article 8 of the Indenture which (BNY submitted) requires any variations to the scheme in the Indenture to take the form of a formal written Supplemental Indenture. BNY relied upon the decision in Rock Advertising Ltd v MWB Business Exchange Centres

[2019] AC 119

and suggested that section 8 operated as a “no oral modification” clause of the kind discussed in that case. BNY said that the alleged S&CA contracts, in order to take effect, needed to vary the Indenture (i.e. imposing an additional duty on BNY in relation to the notes). Article 8 does not merely preclude contractual variations labelled as such, BNY contended: it does not permit any variation which is not executed in accordance with its terms.

[79]Finally, BNY relied again upon the fact that every Supplemental Indenture contained an entire agreement clause at clause 3.1. This is said to preclude reference to surrounding materials, such as the S&CAs, to vary the Supplemental Indenture in respect of each Unlisted Notes.

[80]In relation to the alleged tortious duty, BNY said that: 80.1. the S&CAs’ lack of contractual effect (on BNY’s case) tells against the notion that, by approving or not objecting to the S&CAs, BNY objectively assumed a legal responsibility in tort to Nationwide. The S&CAs are organisational agendas without legal significance. The relevant agenda item, paragraph 4.1, does not contain language redolent of an assumption of legal responsibility in tort any more than it used the duty-imposing language of contract. It is prefaced by a requirement that the UKLA and LSE are informed that Closing has taken place, without providing for who is to take that step; it then indicates that both Nationwide and BNY are to confirm the listing, but does not specify to whom any such confirmation is to be provided; it does not suggest that one was assuming responsibility to, or relying upon, the other; 80.2. the factual background to the agendas negatived any assumption of responsibility. Nationwide and BNY had put in place sophisticated and exhaustive contractual arrangements regulating BNY’s duties in relation to the US MTN Programme, including preparing Supplemental Indentures for each issuance which were negotiated and executed at the same time, and in the same email exchanges, as the drafts of the S&CAs.

[81]BNY also made some points in its Skeleton about reliance and the reasonableness of reliance by Nationwide. But it seemed to me that Lord Grabiner ended up accepting (in his oral submissions) that there was a distinction to be drawn between claims for negligent misstatement and claims for negligent performance of a task or service. Although reliance may be an essential element of a claim for negligent misstatement, that is not the case as regards a claim alleging negligent performance of a task or service. BNY did rely upon the lack of any evidence of reliance as a relevant factor negativing a duty of care, but I did not consider that a very potent point in a summary judgment context.

A&O’s submissions in outline

[82]In its skeleton argument for the summary judgment hearing, A&O took the issues in what might be described as reverse

[83]A&O argued that the following words in the S&CAs imposed on BNY (as well as Nationwide) a responsibility to confirm that listing/admission had taken place:

“…the Issuer and Principal Paying Agent to confirm that the Notes have been listed on the Official List and admitted to trading on the Stock Exchange”

. It said that this expressly allocated responsibility for confirming that the relevant notes had been listed on the Official List and admitted to trading on the LSE to Nationwide and BNY.

[84]Looking at the email exchanges to which I have referred above, A&O argued that BNY had expressly confirmed its agreement to the terms of the S&CA which included the express obligation on BNY’s part to confirm that listing/admission of each of these notes had taken place.For example, in relation to Series 2019-1 and Series 2019-2, BNY did so by circulating drafts of the relevant S&CAs which included the key provision at Clause 4.1 (in relation to confirmation of listing/admission) without any amendments in this regard (although BNY proposed amendments in relation to other provisions of the S&CAs).

[85]A&O suggested that the fact that the S&CAs were described as “agendas”did not mean that they would not have legal consequences. The English word “agenda” derives directly from the Latin word “agere”: “to do”. An agenda can refer either to a list of things to be done, or a list of things to be discussed. A&O also disagreed with BNY’s submission that clause 4.1 “did not contain language redolent of an assumption of legal responsibility”, arguing that no specific form of words is required for that purpose.

[86]In answer to BNY’s reliance upon section 6.1(a)(i) of the Indenture (which provides that “the Trustee undertakes to perform such duties and only such duties as are specifically set forth in this Indenture, and no implied covenants or obligations shall be read into this Indenture against such Trustee …”), A&O said that this was an exemption clause and was to be interpreted on the basis that parties should not lightly to be taken as having intended to give up valuable rights or remedies which they would otherwise have had under the general law.

[87]A&O argued that its construction of section 6.1(a)(i) was supported by the decision in FRN v JP Morgan

[2019] EWHC 347 (Comm)

as to the proper interpretation of a similarly worded provision in JP Morgan’s Depository Agreement which provided (in relevant part) that “…The duties and obligations of the Depository in respect of the Depository Cash shall be determined solely by the express terms of this Agreement…”. Andrew Burrows QC concluded (at [38]-[45]) that the relevant clause was not effective to exclude the bank’s Quincecareduty,which was a duty that was said to arise either by operation of a term implied by law or at common law in the tort of negligence.

[88]A&O submitted that the same would apply to section 6.1(a)(i). It made a series of points in this regard (based on some of the submissions accepted by Andrew Burrows QC in FRN v JP Morgan): 88.1. section 6.1(a)(i) does not refer expressly to the exclusion of any obligations in “tort” or “at common law”, or to the exclusion of any liability for “negligence”. To the contrary, the additional words “…and no implied covenants or obligations shall be read into this Indenture against such Trustee” make it clear that the focus of section 6.1(a)(i) is on contractual obligations; 88.2. on BNY’s interpretation, section 6.1(a)(i) would have to exclude any other obligations either in tort or equity. This would include, for example, liability in the tort of deceit, or for knowing receipt or dishonest assistance, or breach of confidence. A&O suggested that would be a surprising outcome; 88.3. BNY’s case that section 6.1(a)(i) was intended to exclude duties in tort is inconsistent with a number of the other express terms of the 2017 Indenture, which appear to contemplate that BNY could be liable for negligence: see, e.g. sections 6.1(c), 6.6(a), 6.6(b) and 6.6(e).

[89]In his oral submissions, Mr Salzedo ended up saying more about the case for a contractual obligation, despite this having appeared to be relegated to second fiddle in his Skeleton. A&O said that the question of whether the parties had intended to create legal relations could not be determined on a summary basis. It was said to raise questions of mixed fact and law, answering which would inevitably require the Court to conduct a detailed analysis of the relevant email exchanges between Nationwide, BNY and A&O in relation to each of the four Unlisted Notes.

[90]As part of that, while A&O accepted that intention to create legal relations is assessed objectively, it submitted that such an issue is best determined by reference to actual (as opposed to assumed) facts. A&O said that it would want to cross-examine the witnesses for Nationwide and BNY about the background. It said that the terms of the relevant S&CAs were carefully negotiated between the parties (including by BNY’s external lawyers). It contended that BNY’s case begged the question as to why BNY would expressly agree to confirm that listing/admission of each of the Unlisted Notes had taken place, if this undertaking was not intended to have any legal effect.

[91]In the course of his oral submissions, I put to Mr Salzedo one of the points made by Lord Grabiner which seemed to me important: namely that, if paragraph 4.1 of the S&CAs had contractual force as between BNY and Nationwide, it might appear to follow that the other parts of the S&CAs which referred to tasks to be performed must also contain enforceable obligations. For example, paragraph 3.6 provided that:

“The Paying Agent to make payment in accordance with the payment instructions delivered to it by the Issuer”

. Was that really a promise by BNY to make payment which Nationwide could enforce?

[92]Mr Salzedo responded, correctly, that it was not necessary to his case to show that any other provisions (i.e. beyond paragraph 4.1, on which he relied) had contractual effect. He also made clear that whether they did or not might depend on whether the parties identified had agreed to the form of the S&CAs in the way that (A&O argued) BNY had done. But, all of that said, Mr Salzedo was not afraid to pick up the gauntlet. He submitted, for example, that paragraph 3.6 of the S&CAs was the only place which provided for “the acceptance of an instruction in a particular form and the statement as to which account is to be paid into” and that “It is a serious and important matter that Nationwide need to know that BNY have bound themselves to accept the instruction in this form so that when the transaction completes, Nationwide know they will get their billion dollars”.

[93]Moving to BNY’s alternative case, A&O’s answer to BNY’s reliance upon Article 8 of the Indenture was that the provision was in permissive terms. It provides that the parties (i.e. BNY and Nationwide) “may”enter into one or more Supplemental Indentures for various purposes, and then distinguishes between circumstances in which the consent of noteholders is not required (which are addressed in section8.1 ) and circumstances in which the consent of noteholders must be obtained (which are addressed in section

8.2 ).

[94]A&O pointed out that Article 8 does not say the parties “must”enter into a Supplemental Indenture for any purpose. As such, it is not a “no oral modification” clause of the kind addressed in Rock Advertising.

[95]Similarly, section 3.8 of each of the relevant Supplemental Indenture provided only that the same “constitutes the entire agreement of the parties here with respect to the amendments to the Indenture set forth herein”. A&O said that section 3.8 was therefore only concerned with the extent of the amendments to the Indenture which were set out in the relevant Supplemental Indenture.

[96]A&O argued finally that there were other compelling reasons why the case should go to trial. It said that A&O’s case that BNY owed a duty in tort would require the Court to apply the principles about assumption of responsibility in a novel factual context. Specifically, the Court will need to consider whether, in the particular circumstances of this case, a “special” duty was owed by a party performing the roles of Trustee and Paying Agent to the Issuer of notes under a note issuance programme to confirm that listing/admission of the notes had taken place. This is a mixed question of fact and law. A&O argued that such questions should be determined by reference to actual facts (as found following a full trial), rather than on the basis of hypothetical or assumed facts. The Court will inevitably be in a better position to determine these issues following a trial, when it will have a better understanding of (and will have made findings as to) matters such as the function and purpose of the S&CAs within the scheme of the note issuance process (and the understanding of each of the relevant parties in this regard).

[97]A&O also suggested that its case against BNY (in both tort and contract) overlaps to a significant extent with the matters on which A&O relies in its defence of the claim brought against it by Nationwide. A&O was saying that the S&CAs allocated responsibility for confirming that listing/admission had taken place to both Nationwide and BNY, and A&O relied on Nationwide’s failure to do so in support of A&O’s defences to Nationwide’s claims.

Additional submissions and evidence

[98]I have referred above to the fact that, in the course of his oral submissions, Mr Salzedo argued that paragraph 3.6 of the S&CAs was the, or at least a, source of BNY’s obligation to pay over sums to Nationwide once received from the Placement Agents.

[99]Lord Grabiner took issue with that contention, suggesting in his oral reply that there was a complex structure that sat behind paragraph 3.6 of the S&CAs and the appendix referred to therein. He referred to a Terms Agreement (between Nationwide and the Placement Agents) and said that “if it becomes important, it may be necessary that we'll have to provide your Lordship and my learned friend with that document and possibly any other”.

[100]I asked how he was proposing we took that possibility forward. Helpfully, Mr Salzedo immediately made clear that he would not object to further relevant documents being put before the Court following the hearing, so long as he was given an opportunity to respond to them. It was agreed that they could be adduced by a further witness statement, together with short written submissions, to which A&O would have a right of reply.

[101]On 12 March 2025, I was provided with the third witness statement of Mr Johnson, which exhibited(a) the Private Placement Agency Agreement between Nationwide as Issuer and the Placement Agents dated 28 June 2007 and

(b) the Terms Agreements. BNY also filed a short page “Supplemental Note”.

[102]In that Note, BNY submitted, in essence, that paragraph 3.6 of the S&CA was not the source of BNY’s right to receive the issuance proceeds, nor of its duty to remit those proceeds to Nationwide, nor of Nationwide’s entitlement to direct that such proceeds be remitted to it. Nor, BNY argued, was the S&CA the source of the agreed Depository Trust Company (“DTC”) settlement process (i.e. DvP) for the Unlisted Notes or of the Placement Agents’ duties on settlement. On the contrary, paragraph 3.6 merely recorded the effect of obligations contained elsewhere in the transaction documents and the essential features of the mode of DTC settlement mechanism chosen for the Unlisted Notes.

[103]For this purpose, BNY relied upon section 3.3 of the Indenture, which provides that “At any time and from time to time after the execution and delivery of this Indenture, the Issuer may deliver Notes of any series executed by the Issuer to the Trustee for authentication, together with an Issuer Order for the authentication and delivery of such Notes, and the Trustee in accordance with the Issuer Order shall authenticate and deliver such Notes”.

[104]Mr Johnson said that the settlement process used was for delivery of the notes to the persons entitled to them to be contingent on payment for the notes being made at the same time (a process referred to as “delivery versus payment” or “DvP”). In this scenario, once BNY has authenticated the global note (representing the entire issue of notes of that series) as required under section 3.3 of the Indenture and the global note has been credited to BNY’s account at DTC, BNY submits instructions to DTC for the delivery of the notes to the relevant placement agent(s), and the placement agent(s) purchasing the notes submit corresponding instructions to DTC for payment for the notes to BNY. DTC will only settle the trade where it has received both sets of instructions and those instructions match. Mr Johnson said it is inherent in, and an integral part of, a DvP trade that, when the notes are delivered by BNY through DTC on behalf of the issuer (here Nationwide), a corresponding payment is made through DTC to BNY, as agent for the issuer. BNY accounts for those funds as funds of the issuer, and they are paid promptly to the issuer.

[105]For each series of Unlisted Notes, BNY received a signed Letter of Instruction from Nationwide which represented the relevant Issuer Order. Each Letter of Instruction delivered to BNY was in the form that was appended as Appendix 2 to the S&CA for that issuance. That Letter of Instruction began: “Under section 3.3 of the Indenture…”.

[106]BNY’s suggestion was that it was inherent in, and a necessary incident of, BNY’s obligation to deliver the Notes through DTC, as instructed, in a DvP settlement, that it would receive the issuance proceeds through DTC as agent for Nationwide and would account to Nationwide for those proceeds immediately once received.

[107]Accordingly, BNY said, had the S&CA not been circulated, or had it omitted paragraph 3.6, the settlement and payment process would have operated in the same way by virtue of a combination of section 3.3 of the Indenture, the standard settlement instructions from Nationwide which were already in place for payments to it from BNY, and the other transaction documents and inherent features of the settlement process.

[108]A&O responded to BNY’s further submissions and evidence on 21 March 2025. It said that, in fact, the evidence filed by BNY strongly supported A&O’s submission that the S&CAs were the source of important legal rights and obligations.

[109]It contended that BNY’s right to receive the proceeds of each issuance from the Placement Agents was not derived from the Base Indenture, the Supplemental Indentures, or any other “transaction documents”. That was because the reason given by Mr Johnson for the conclusion that each of the Unlisted Notes was to be settled on DvP terms had been that “… the language of the Letter of Instruction the form of which was set out at Appendix 2 to each S&CA for the unlisted Notes … instructed BNY to deliver the relevant Notes “against payment therefor”…”. More specifically, the Letter of Instruction at Appendix 2 to the S&CA for Series 2018-1 stated:

“Under Section 3.3 of the indenture … you are hereby requested to (i) execute three counterparts of the First Supplemental Indenture and (ii) authenticate, in the manner provided by the Indenture, the Notes … and to deliver such Notes… against payment therefor. Please acknowledge receipt of these instructions and the Notes below”

(emphasis added). Please acknowledge receipt of these instructions and the Notes below”

[110]A&O said that section 3.3 of the Indenture was not the source of BNY’s right to receive the proceeds. That section deals only with BNY’s obligations to “authenticate” and “deliver”the Notes. It says nothing about what is to happen to the proceeds of the issuance, or about BNY’s right to receive those proceeds. It does not provide for Notes to be settled on a DvP basis. To illustrate the distinction, A&O points out that Mr Johnson refers to the Letter of Instruction at Appendix 2 to the S&CA for Series 2015-2, which provided for BNY to deliver the notes to the Settlement Agent “free of payment” (as opposed to “against payment therefor”).

[111]This was said to mean that, logically, it cannot be the case that BNY’s right to receive the issuance proceeds was determined by the terms of section 3.3 of the Indenture (because, in fact, it would depend upon the terms of Appendix 2 to the S&CA). It was the form of the Letter of Instruction at Appendix 2 to the S&CAs which determined whether BNY was to receive the issuance proceeds from the Placement Agents, or whether these proceeds were to be paid directly to Nationwide.

[112]A&O also pointed out that BNY was clearly struggling to identify any basis, in any other “transaction document”,for BNY’s obligation to pay the proceeds to Nationwide, such that Mr Johnson was forced to assert in his statement that it was “inherent in” or “a necessary incident of” BNY’s obligation to deliver the notes through DTC in a DvP settlement that BNY would “receive the issuance proceeds through DTC as agent for Nationwide and would need to account to Nationwide for those proceeds once received”. Neither the PPAA nor the Terms Agreements assisted in this regard. A&O maintained that the only place where BNY’s obligation to pay the proceeds for each of the Unlisted Notes to Nationwide was clearly set out is at paragraph 3.6 of the S&CAs, pursuant to which it was agreed that BNY, in its capacity as Paying Agent, would “make payment in accordance with the payment instructions delivered to it by the Issuer”.

[113]My directions for an exchange of further evidence and submissions following the hearing did not envisage any reply from BNY, but one was filed on 25 March 2025.

[114]This argued that: 114.1. the evidence of Mr Johnson had actually been that section 3.3 of the Indenture together withthe Letter of Instruction in the form at Appendix 2 was the source of BNY’s obligations and rights in respect of settlement and receipt of proceeds; 114.2. none of this supported A&O’s case that paragraph 3.6 of the S&CAs had legal effect. BNY said that this amounted to a wrongful conflation of the contents of the S&CAs with the instruction letters, which were agreed as Appendices to the S&CAs. The fact that the S&CAs referred to documents that were to be signed and/or executed by the relevant parties did not mean that the S&CAs themselves were also intended to be contractual documents. On the contrary, the fact that these documents were executed and/or signed, but the S&CAs were not, demonstrates that the latter were not intended to have any legal effect; 114.3. the suggestion that, but for paragraph 3.6 of the agendas, BNY could lawfully have retained the issuance proceeds, was said to be legally and commercially absurd. BNY also relied upon the regulatory position: it told me that BNY could not have retained the issuance proceeds as a matter of its regulatory obligations. The regulatory position was said to reinforce the uncommerciality of A&O’s argument.

[115]A&O was critical of BNY for entering these reply submissions without permission. However, I did not understand A&O to be suggesting that, as a result, I should not read the reply submissions and, as will be apparent from the foregoing, I have read that. In a letter dated 26 March 2025, A&O’s solicitors made clear that they did not propose to serve any further submissions unless I requested further assistance.

My analysis (contract)

[116]It seems to me that the key question is whether it is properly arguable that the S&CAs, and specifically clause 4.1 thereof, had any contractual effect as between Nationwide and BNY. Indeed, the issue for me can be refined yet further, because, as I have said, BNY’s primary case was that there was no intention to create legal relations. The submission was that I could decide today that there was no such intention, such that, despite that paragraph undoubtedly being expressed in language that was capable of giving rise to a contractual obligation (“the Issuer and Paying Agent to confirm that the Notes have been listed”), it did not have any contractual effect.

[117]There was some discussion of the burden of proof on an issue of this kind. Mr Salzedo pointed to paragraph 4-208 of Chitty on Contracts (35th Ed), citing Edwards v Skyways Ltd [1964] 1 W.L.R. 349 at p.355: “In the case of ordinary commercial transactions it is not normally necessary to prove that the parties to an express agreement in fact intended to create legal relations.The onus of proving that there was no such intention “is on the party who asserts that no legal effect is intended, and the onus is a heavy one”…”.

[118]For his part, Lord Grabiner submitted that the next paragraph (Chitty paragraph 4-209) is more apposite: “The rule as to burden of proof stated in para.4-207 above applies where the parties had entered into an express agreement, whether written or oral.Claims or defences are, however, sometimes based on the allegation that parties between whom there was no express agreement had so conducted themselves in relation to each other that an implied contract was to be inferred from their conduct; and in a number of cases of this kind the allegation has been rejected on the ground that there was no contractual intention.941 Such cases illustrate the judicial attitude that “contracts are not lightly to be implied” and that the courts must (in cases of this kind) be able “to conclude with confidence that …the parties intended to create contractual relations”,or that it must be “necessary” to imply a contract.Thus, the burden of proof on this issue appears, in cases of implied contracts, to be on the proponent of the contract, contrary to the rule which applies to express agreements regulating commercial relationships”.

[119]It seems to me that Lord Grabiner was right about this: A&O is contending for an implied agreement, even if one which is partly evidenced in writing. See, for example, the way in which it was expressed in A&O’s FI: BNY “impliedly and/or by its conduct” agreed the terms of the four alleged contracts.

[120]I should add that I doubt that it ultimately matters. It would be an unusual summary judgment application which turned on the location of the burden of proof. However, even if A&O is wrong in its primary submission that BNY would face a heavy burden to show that there was no contractual intention, there is no doubt that this is a highly fact sensitive issue. Everyone agreed that the issue is to be answered objectively, by reference to all of the material which crossed the line between the parties.

[121]Consistent with that, I would suggest that most of BNY’s arguments in this regard were evaluative and impressionistic: they amounted to saying, not that x showed that there cannot have been an intention to contract, but rather that x suggested that it was unlikely that there was any such intention. Lord Grabiner emphasised that his arguments worked cumulatively: it was not just x, but also that y and z combined with x to point in the same direction. But that might be said to highlight the challenge for BNY. It was inviting me to conclude that it was not even arguable that Nationwide and BNY had an intention to contract in the terms of (at least paragraph 4.1 of) the S&CAs. Yet it was forced to do so on the basis of the cumulative unlikelihood of the contrary conclusion.

[122]Some of the arguments deployed by Lord Grabiner in this regard seemed to me to have only limited force. For example, the absence of a signature block and of formalities (such as providing for governing law and the suchlike) might be said to be neutral. If they had been included, that would probably have resolved the issue (in A&O’s favour). But, while seeing someone eat meat strongly suggests that they are not a vegan, it does not follow that seeing someone eat a vegetable proves that they are.

[123]Similarly, I did not really see why the language of paragraph 4.1 of the S&CAs (e.g. “the Issuer and Paying Agent to confirm”) was not consistent with a contractual obligation. Nor was I especially taken with the reliance on the description as an “agenda”. I accept that many agendas will not be intended to be contractually binding, but describing a document in that way is hardly equivalent to the parties including the words “subject to contract”.

[124]Indeed, Lord Grabiner’s submission about the S&CAs being drawn up between sophisticated lawyers cuts both ways. Experienced transactional lawyers know about contracts and how to prevent them coming into being accidentally.

[125]To my mind, BNY’s best arguments concerned the context: especially the fact that the S&CAs allocated tasks to so many different parties, and the way in which the S&CAs were drawn up by lawyers for those parties alongside formal contractual agreements such as the Supplemental Indenture and the Final Terms, but were so different in format from those agreements. Those points gave me real pause as I asked myself whether A&O had any real prospect of showing that there was a binding agreement.

[126]It is important to see that those soft-edged arguments (i.e. about the unlikelihood of contractual intention, given the context) shaded into BNY’s harder-edged submissions to the effect that such a contract was precluded by the terms of the Indenture or Supplemental Indentures. In his oral presentation, Lord Grabiner gave plenty of airtime to those harder-edged submissions, clearly conscious that success on such a short point of construction would be an easier route to summary judgment. But I was not persuaded by any of them, at least to the degree that would be necessary for me to “grasp the nettle” and finally decide the point of construction in BNY’s favour at the summary judgment stage.

[127]There was no issue about the legal principles. I accept, for example, that there are good reasons why parties might include “no oral modification” clauses in commercial contracts and that such provisions can be given full effect in accordance with their terms. In Rock Advertising Ltd v MWB Business Exchange Centres

[2019] AC 119

(at [12]), Lord Sumption identified three good reasons for including such clauses: “…The first is that it prevents attempts to undermine written agreements by informal means, a possibility which is open to abuse, for example in raising defences to summary judgment. Secondly, in circumstances where oral discussions can easily give rise to misunderstandings and crossed purposes, it avoids disputes not just about whether a variation was intended but also about its exact terms. Thirdly, a measure of formality in recording variations makes it easier for corporations to police internal rules restricting the authority to agree them”.

[128]However, one cannot work backwards from the justification; conjuring up a clause where nothing of that type has actually been agreed. It seems to me that Article 8 of the Indenture is aimed at a different target. It is concerned to protect noteholders, who may otherwise be bound by an agreement between BNY and Nationwide over which they have no control. Hence permitting amendments which could not prejudice the noteholders to be made without their consent, providing for certain other amendments to be made with the consent of the majority (in aggregate principal amount), and finally having a further category of amendments which can only be made with the consent of each noteholder.

[129]There seem to me to be a myriad of problems with trying to read Article 8 of the Indenture as a “no informal modification” stipulation. The first is that it does not say anything about the form in which any modifications to the Indenture must be made. Rather, as A&O submitted, it is permissive, identifying the circumstances when amendments can be made.

[130]BNY submitted that section 8 means that any amendments must take the form of a duly executed Supplemental Indenture. But I cannot find where the Indenture says that. In relation to form, section8.1 only provides that any Supplemental Indenture must be “in form satisfactory to each Trustee” and section

8.2 actually makes clear that “It shall not be necessary for any Act of Holders under this Section to approve the particular form of any proposed supplemental indenture…”.

[131]The highest that it seems to me that it could be put is that, if Nationwide and BNY wanted to bind noteholders simply by amending the terms of the Indenture, they needed to bring themselves within one of the scenarios provided for in sections 8.1 or 8.2. If they did so, I am doubtful whether any particular form (e.g. a document headed “Supplemental Indenture”) would be required. But if they could not bring themselves within one of the scenarios here, I cannot see why it matters. The alleged agreement on which BNY is relying did not need to operate as an amendment to the Indenture. It did not need to bind the noteholders.

[132]What BNY really wanted to find here was a combination of(a) a requirement that any amendments to the Indenture be in a particular form and

(b) the equivalent of an entire agreement clause to prevent collateral agreements concerned with the same subject matter.

[133]In fact, BNY could point to neither. As I have said, section 8 does not provide that amendments had to be in a particular form. Nor does the Indenture contain any entire agreement clause. The nearest equivalent was clause 6.1(a)(i), which stated that “the Trustee undertakes to perform such duties and only such duties as are specifically set forth in this Indenture”. But, on the face of it, that is concerned only with the terms of the Indenture itself, and with preventing further duties being implied. It does not say anything about the content or effect of any other freestanding agreements between the parties.

[134]Lord Grabiner placed reliance on the entire agreement clause (section 3.8) in the Supplemental Indentures. But that was narrowly worded:

“This Supplemental Indenture constitutes the entire agreement of the parties hereto with respect to the amendments to the Base Indenture set forth herein”

(emphasis added). As Lord Grabiner fairly acknowledged in his oral submissions:

“you could strictly speaking read that clause as limited only to the specific amendments made to the base indenture”

. It would certainly not be straightforward for BNY to argue that an agreement between Nationwide and BNY to the effect that BNY would confirm that notes had been listed would fall foul of section 3.8. Such an agreement would have nothing to do with the amendments to the Indenture which were contained in the Supplemental Indenture.

[135]It was noteworthy that, when BNY did agree to carry out the listing, they did not amend the Indenture or issue a Supplemental Indenture. Lord Grabiner described the result as “an agreement in the loosest sense”, but I understood him to accept that, on the occasions which BNY had been asked to carry out the listing and had responded to say that it would do so, it would not have been open to BNY to decide not to bother on the basis that there was no Supplemental Indenture. He confirmed that “I couldn't say, well, I've agreed to do it but I'm not bound to do it”.

[136]None of this detracts from BNY’s more general point that the context, with the parties entering into formal agreements, including entire agreement clauses and the suchlike, and intending to bind the noteholders as well as BNY and Nationwide, does not fit very well with the use of an agenda supposedly to reflect various other contractual obligations which might be said to cut across that formal scheme. Nor, I should make clear, should the view I have expressed above be taken as to the final word on any of these legal arguments, all of which will of course remain open to BNY at trial.

[137]However, my conclusions on these alternative arguments do mean that BNY could not land the simple knockout punch of the type which more usually results in reverse summary judgment. As I have said, BNY is left with a series of reasons why, looked at in the round, it seems unlikely that agreeing or confirming the content of the S&CAs was intended to create an enforceable contract. I repeat that a number of those points do seem to me to have force. Indeed, my own instinctive response to A&O’s allegation that the S&CAs were objectively intended to evidence binding contracts between Nationwide, BNY, A&O (and perhaps many others) was somewhat sceptical.

[138]In the end, however, it does not seem to me that my sceptical reaction, looking at the case (as it were) on the papers, is a sufficient basis for granting summary judgment. To put it another way, despite that scepticism, I have concluded that A&O does have real prospects of showing that there was an intention to create legal relations in respect of paragraph 4.1 of the S&CAs. I reach that conclusion for four main reasons: 138.1. first, there was a degree of formality and care about the way in which the S&CAs were circulated, finalised and confirmed in the lead up to the issue of a new series of notes. The use of tracked changes, the giving of comments, or confirming that no changes were required, the careful implementation of any comments and changes to arrive at a final form before the transaction goes ahead: all of this suggested that the parties to those exchanges considered this to be an important document, playing a formal role in their arrangements. The emails themselves also reveal that the parties saw the S&CAs as critical documents. As Mr Salzedo put it, this was a world away from an email where someone makes an administrative arrangement which is clearly not intended to have any contractual role (e.g. “I will meet you tomorrow”); 138.2. second, it seemed to me that there might be force in A&O’s argument that some aspects of their arrangements were only being defined by the parties’ agreement to the S&CAs. 138.2.1. For example, it was a little surprising that BNY did not appear to be able to point to any obligation to make payment in accordance with Nationwide’s instructions, save for paragraph 3.6 of the S&CAs (which, of course, BNY denied amounted to an obligation). Suggestions to the effect that BNY would be obliged to hand over any money received from the Placement Agents as a matter of common sense, or to avoid falling foul of regulatory restrictions on holding client money, did not seem to be inconsistent with the possibility that paragraph 3.6 was, as it appeared on its face, a promise by BNY to make that payment once an instruction in the form of Appendix 3 was received. 138.2.2. Moreover, I struggled slightly with BNY’s contention that one should distinguish between the S&CA itself and the appendices thereto. I accept that a signed letter of instruction might have a contractual effect (perhaps pursuant to section 3.3. of the Indenture, if it concerns delivery and authentication of notes) even if nothing had been agreed in any binding way before that. But that distinction assumes that it remained open to Nationwide to give instructions otherwise than in the form of Appendix 2 and Appendix 3, which might be said to beg the question. Indeed, if the parties were not definitively agreeing the format which these instructions would take, what was the purpose for the appendices? If the parties were agreeing the format, it follows that the process of finalising the S&CAs, with their appendices, did have at least some binding effect; 138.3. third, when I drilled down into my own reasons for scepticism, it seemed to me that an important part of it was my sense that transactional lawyers would not want their clients to be contractually bound by items in an agenda of this kind; that the idea would horrify them and cause them to include more boilerplate language when dealing with procedural/ organisational matters. There are, however, three problems with allowing a “sense” of what transactional lawyers might think to play any substantive role at the summary judgment stage: 138.3.1. the first is that there is an element of circularity in this approach: I would be assuming that the reason why these lawyers had not made clear that the S&CAs were not intended to be binding was because it had not crossed their minds that anyone would suggest that they were binding. Mr Salzedo submitted that this possibility would cross the minds of experienced lawyers, and hence it was more likely that the reason no “subject to contract”-like formulation was used was because there was an intention to be bound; 138.3.2. the second is that there was no evidence or agreement before me about what transactional lawyers generally would think. I am not suggesting that this would be a suitable subject for expert evidence, at least unless one side sought to rely upon a market understanding which was alleged to be sufficiently certain to form part of the objective background against which intention to create legal relations is to be judged. I have never been a transactional lawyer and, if I had been, it may be that the danger of my falling into error in this regard would be increased. It is inevitable that judges bring their own experience to bear when seeking to put themselves in the positions of the parties (e.g. for the purposes of an objective analysis). But they should not be assuming that their own perspective – even if the product of that experience – amounts to the equivalent of a market understanding; 138.3.3. the third is that the process of hearing evidence at trial can provide the trial judge with insight into the perspectives of those involved at the time. There is obviously a thin line between exploring shared assumptions and attitudes, and adducing evidence about the individual witnesses’ subjective intentions. But cross-examination which is on the right side of that line can bring emails to life and allow the interactions to be seen in three dimensions. That is the stage at which to make findings about the thinking underlying (rather than being expressed in) the documents, if any such findings are necessary. I should not have to make assumptions about that thinking in order to grant summary judgment; 138.4. finally, for those reasons, this does not seem to me to be a straightforward question of law where it is appropriate for me to grasp the nettle and provide the answer now, so as to avoid the parties’ wasting their money and the Court’s time by continuing to a trial. It is not equivalent to a simple question of construction, even if it involves the application of an objective test. It requires an evaluation of where the facts of this case fall on a spectrum, with (at one end) there being no doubt that there was an intention to create legal relations, and (at the other) it being obvious that there was no such intention. Where there is a spectrum of that kind, there will no doubt be scenarios for which there is no doubt what the answer would be at trial, such that summary judgment is appropriate. Here, where there has been careful agreement on the terms of a document which was described as an agenda, I do not feel the required degree of confidence about where to locate it on the spectrum.

[139]I thus conclude that the contractual claim does have real prospects of success at trial.

My analysis (tort)

[140]I asked Lord Grabiner at an early stage of his oral submissions whether he took issue with Mr Salzedo’s contention that, if A&O was right that the tort argument had real prospects of success, it would not make a great deal of sense for me to grant summary judgment in relation to the contract argument. I did not understand him to dissent from that contention when I originally raised it with him, even if he seemed in his oral reply to want to row back from his original answer.

[141]In any event, to my mind, both this proposition and the reverse are obvious. If there is going to be a trial at which A&O is going to contend that BNY had a contractual obligation to confirm whether the notes had been listed, it would be very unwise for me to prevent it contending that there was an overlapping tortious obligation. That seems to me precisely the type of scenario about which the Court of Appeal was sounding a warning in TFL Management: “the court should still consider very carefully before accepting an invitation to deal with single issues in cases where there will need to be a full trial on liability involving evidence and cross-examination in any event…”.

[142]With that in mind, having reached the view which I have expressed above about the contractual claim, it is tempting to say very little about the tortious duty. However, in deference to the arguments presented, I will seek to explain two points: namely(a) why, if I had taken the opposite view of the issue about intention to create legal relations, I would also have rejected A&O’s “assumption of responsibility” argument and

(b) why, having taken the view that it is arguable that there was an intention to create legal relations, it seems to me to follow that it is also arguable that there was a special duty of care in tort.

[143]In relation to the first of those points, it is obviously correct to say that the absence of a contract does not mean that there cannot be a special duty of care in tort. In Hedley Byrne v. Heller

[1964] AC 465

itself, it was argued that the reference given by the bankers could not give rise to any duty of care because it was provided gratuitously. Lord Devlin made clear that was not the law (at p.526): “The respondents in this case cannot deny that they were performing a service. Their sheet anchor is that they were performing it gratuitously and therefore no liability for its performance can arise. My Lords, in my opinion this is not the law. A promise given without consideration to perform a service cannot be enforced as a contract by the promisee; but if the service is in fact performed and done negligently, the promisee can recover in an action in tort”.

[144]Note, however, that the reason the bankers’ promise to perform could not be enforced was the absence of consideration.

[145]Lord Devlin continued (at p.529): “I think, therefore, that there is ample authority to justify your Lordships in saying now that the categories of special relationships which may give rise to a duty to take care in word as well as in deed are not limited to contractual relationships or to relationships of fiduciary duty, but include also relationships which in the words of Lord Shaw in Nocton v. Lord Ashburton are "equivalent to contract," that is, where there is an assumption of responsibility in circumstances in which, but for the absence of consideration, there would be a contract. Where there is an express undertaking, an express warranty as distinct from mere representation, there can be little difficulty. The difficulty arises in discerning those cases in which the undertaking is to be implied. In this respect the absence of consideration is not irrelevant. Payment for information or advice is very good evidence that it is being relied upon and that the informer or adviser knows that it is. Where there is no consideration, it will be necessary to exercise greater care in distinguishing between social and professional relationships and between those which are of a contractual character and those which are not”.

[146]I read this as meaning that a relationship which is equivalent to contract, but absent the consideration which would give rise to an enforceable obligation, may nevertheless have that special quality which involves an assumption of responsibility.

[147]In Williams v. Natural Life

[1998] 1 WLR 830

, Lord Steyn described the concept of an assumption of responsibility as performing a gap-filling role (at p.837): “…Coherence must sometimes yield to practical justice. In any event, the restricted conception of contract in English law, resulting from the combined effect of the principles of consideration and privity of contract, was the backcloth against which Hedley Byrne was decided and the principle developed in Henderson's case…It may become necessary for the House of Lords to re-examine the principles of consideration and privity of contract. But while the present structure of English contract law remains intact the law of tort, as the general law, has to fulfil an essential gap-filling role. In these circumstances there was, and is, no better rationalisation for the relevant head of tort liability than assumption of responsibility”.

[148]It is clear from this that Lord Steyn considered the English law “principles of consideration and privity of contract” to involve a degree of technicality, such that the law of tort, and the concept of an assumption of responsibility, were required to fill the gap.

[149]It is one thing to say that a promise which is not enforceable because of the absence of consideration might nevertheless amount to an assumption of responsibility. It is another to say that, if the parties, viewed objectively, are to be understood as not having intended to create any legally enforceable obligation, their actions might still be said to be an assumption of responsibility, so as to create a legally enforceable obligation. That would seem counterintuitive to say the least. It would take the long-criticised artificiality of the “assumption of responsibility” test to a whole new level: “I did not intend to be bound, but I did intend to assume responsibility…”.

[150]Mr Salzedo did not identify any example of a case in which there was held to have been no intention to create legal relations, and as a result no contractual obligation to do a thing, but there was nevertheless a tortious assumption of responsibility which required that same thing to be done. Most of his examples involved scenarios in which the defendant had chosen to do something, and the complaint was that the defendant had not done so correctly, or sufficiently.

[151]He argued that White v. Jones

[1995] 2 AC 207

was an example of an assumption of a responsibility for performing a task. He showed me the passage where Lord Browne-Wilkinson explained the concept of assumption of responsibility and emphasised the words “responsibility for the task” (see p.421): “Just as in the case of fiduciary duties, the assumption of responsibility referred to is the defendants, assumption of responsibility for the task not the assumption of legal liability. Even in cases of ad hoc relationships, it is the undertaking to answer the question posed which creates the relationship. If the responsibility for the task is assumed by the defendant he thereby creates a special relationship between himself and the plaintiff in relation to which the law (not the defendant) attaches a duty to carry out carefully the task so assumed…”.

[152]That passage seems to me to be addressing the specific criticism of the assumption of responsibility test to which I have referred above (i.e. to the effect that it was unrealistic to imagine that the defendant was intending to assume a legal liability). The reason the solicitors in White v. Jones were involved with preparing the new will was because they had been instructed to do so by the testator. The reason that instruction did not give rise to a contractual obligation which could be enforced by the disappointed intended beneficiaries was the English law doctrine of privity.

[153]As such, it seems to me that the approach to the assumption of responsibility in White v. Jones is closely equivalent to that seen in Hedley Byrne: filling the gap where a technicality of English law prevents a relationship which is akin to a contract from being enforced. That view is perhaps supported by the way in which that whole series of cases was described by Lord Bingham in Customs & Excise Commissioners v. Barclays Bank

[2006] UKHL 28

(at p.190): “…I content myself at this stage with five general observations. First, there are cases in which one party can accurately be said to have assumed responsibility for what is said or done to another, the paradigm situation being a relationship having all the indicia of contract save consideration. Hedley Byrne would, but for the express disclaimer, have been such a case. White v Jones and Henderson v Merrett Syndicates Ltd , although the relationship was more remote, can be seen as analogous…”.

[154]If I had accepted Lord Grabiner’s submission that A&O has no realistic prospect of proving an intention to create legal relations when agreeing the content of the S&CA, therefore, I would have rejected A&O’s alternative tort claim premised upon an assumption of responsibility. Since, however, I have decided that the contractual claim is properly arguable, the position is different. It is plain that a contractual promise can double as an assumption of responsibility. There is no difficulty with the idea that there might be a tortious duty which operates concurrently with the contractual obligation to check that registration has been performed.

[155]Lord Grabiner’s submissions to the effect that the duty is excluded by the terms of the Indenture did not persuade me that summary judgment could be granted in this regard. It is important to distinguish, at this stage of the analysis, between arguments to the effect that the shape of the contractual relationship is inconsistent with an assumption of responsibility, and arguments about excluding tortious duties, even if overlapping with a contractual obligation. See BP Plc v Aon Limited Aon Risk Services of Texas Inc [2006] 1 C.L.C. 881, where Colman J at [66(vi)] described the two stages: “The existence of an assumption of responsibility is to be tested in a case where there is a contractual structure to which the defendant is party by asking what it is that the defendant has undertaken to perform within that structure. There is a two stage process. It is first necessary to investigate his obligations to see whether he has undertaken to provide relevant advice, information or services, and if so, whether it is expressly or impliedly provided that he is to exercise reasonable skill and care in so doing. If so, he will owe at least a potential duty of care to his immediate contracting party. The second stage involves asking whether the terms of the contract to which he is party have excluded or limited his liability for failure to perform such obligations either carefully or at all…”.

[156]Once I have decided that the contractual claim can go to trial, the first stage becomes difficult for BNY. If the S&CAs have contractual effect, it might follow that BNY has undertaken to provide relevant services. There is, in short, no inconsistency with the contractual scheme. BNY must use reasonable skill and care to do what it has (on this hypothesis) agreed to do and it also owes a concurrent duty not to do it negligently. None of that involves short-circuiting the contractual structure.

[157]In relation to the second stage, I agree with Mr Salzedo that BNY would need to point to clear words in order to exclude a duty which would otherwise arise. See Triple Point Technology Inc v PTT Public Co Ltd [2021] A.C. 1148 at [106]-[112] (e.g. “clear words are necessary before the court will hold that a contract has taken away valuable rights or remedies which one of the parties to it would have had at common law”).

[158]Article 6.1(a)(i) of the Indenture provides that “the Trustee undertakes to perform such duties and only such duties as are specifically set forth in this Indenture, and no implied covenants or obligations shall be read into this Indenture against such Trustee…”. That might suffice to prevent (contractual) terms being implied into the Indenture. But it says nothing about tortious duties, let alone duties which are not said to arise out of the Indenture itself. I agree that there is an analogy to be drawn with the interpretation of the clause in FRN v JP Morgan, at least in terms of the approach to be taken to such exclusion clauses.

[159]For these reasons, on the basis that I have concluded that it is properly arguable that there was an intention to create legal relations, it follows that it is also arguable that there was a special duty of care in tort, by virtue of an assumption of responsibility.

Conclusion

[160]I have concluded that, notwithstanding my initial scepticism, A&O has a real prospect of showing that that BNY agreed with Nationwide, via the S&CAs, that it (as well as Nationwide) would check whether the relevant notes had been listed. On that basis, the claim for a contribution may be difficult, but it is not hopeless. The trial judge might, and would be entitled to, see the issues I have discussed in this judgment very differently.

[161]In the light of that conclusion, it seems to me that the alternative claim in tort, premised upon an assumption of responsibility, also has real prospects of success. In any event, if the contribution claim is going to trial on the basis of the contractual analysis, it would not be appropriate to grant summary judgment in respect of the overlapping tortious analysis. That would tie the hands of the trial judge in a way that would be unsatisfactory. Costs of amendment application Introduction

Costs of amendment application

[162]Given that A&O’s contribution claim has survived the application for summary judgment, I understand it now to be accepted that Nationwide should be given permission to amend its Reply (or really its Defence to Counterclaim), so as to add a contingent answer to BNY’s possible claim for an indemnity. Specifically, Nationwide wishes now to plead that, if the Court holds that BNY must contribute to A&O’s liability to Nationwide because of BNY’s negligence, BNY will not be entitled to an indemnity from Nationwide in respect of that same liability, because the liability will be “attributable to the Trustee’s negligence” (see section 6.6(b) of the Indenture).

[163]Nationwide accepts that it must pay the costs of and occasioned by its amendment in any event. But it complains that BNY should have consented at the outset (if necessary, conditionally by reference to the application for summary judgment). Its submission, in simple terms, is that Nationwide first invited BNY to agree that the contingent amendment application need only be made in the event that BNY’s summary judgment application failed. BNY refused. When Nationwide issued the contingent amendment application in November 2024, BNY continued to withhold its consent. BNY only consented on 25 February 2025.

[164]In those circumstances, Nationwide argues, it has been successful on an application which it was forced to make as a result of BNY’s intransigence. It argues that it should have its costs of the application.

[165]I was shown a series of messages, starting with the letter from Travers Smith dated 27 September 2024, in which Nationwide made clear that it was not adopting the “Confirmation Duty” argument as the basis for a claim against BNY, but did propose to amend to rely upon the breach of that duty. The proposed amendment used a formulation which contended that the consequence of the breach was “the indemnity is not engaged”.

[166]BNY said that this suggested that BNY would not be able to make any recovery under the indemnity if there was a breach of duty – i.e. BNY would not just be prevented from recovering in respect of its own liability to A&O for breach of that duty. At that time, it remained unclear whether HMRC was going to assess Nationwide or BNY for the withholding tax which had not in fact been withheld. BNY took the view that it would be entitled to claim under the indemnity for that £80m+, so any suggestion that the indemnity might not operate caused BNY real concern.

[167]Mr Valentin KC, for Nationwide, submitted that it was “clear from the outset… that [the amendment] was concerned only with preventing Bank of New York recovering from Nationwide those amounts which A&O might have been ordered to pay Nationwide and A&O had then recouped by way of its Part 20 claim”. Later, he made a similar submission:

“Bank of New York was never in any doubt, or could never have been in any doubt, as to the limited purpose of the amendment and the limited scope of it”

. I do not agree. It seems to me that BNY were right to read the suggested amendment, in this original form, as potentially having a wider impact on the indemnity.

[168]In a letter from Travers Smith dated 14 October 2024, Nationwide did explain the intended effect of the potential amendment more clearly, outlining the circularity (or “round-tripping exercise”, as Mr Valentin described it) to which Nationwide objected. The position was also said to emerge clearly from the witness statement of Mr Lee of Travers Smith in support of the application to amend. Both that letter and the witness statement were, I agree, reasonably clear about what Nationwide intended.

[169]However, the proposed amendment provided with the application in November 2024, remained ambiguous in this regard. It continued to say that “the indemnity is not engaged”, without any limitation on the width of that averment.

[170]Mr Valentin said it did not matter. Nationwide had explained its position in its evidence and in correspondence. It did not need, he argued, to clarify the amendment. Instead, he submitted, BNY should have given its consent and then asked for Further Information so as to clarify Nationwide’s pleading, if there was thought to be a need to do so.

[171]Mr Gilson, junior counsel for BNY, who had conduct of this issue, explained that BNY was very keen for any wider argument about the operation of the indemnity to be brought forward so that it could be addressed at the summary judgment application. I am sure that is correct; after all, BNY’s position was that success on the summary judgment application should result in BNY having no further role to play in the litigation. It did not want to be told that one point which it had not even understood remained live in relation to its counterclaim on the indemnity.

[172]On 7 February 2025, Nationwide provided a revised draft set of amendments. This added, after the reference to the indemnity not being engaged, the words “in respect of any loss, liability, charge or expense incurred by the First Defendant attributable to that negligence…” and then described what amounts and costs might be caught in practice. This revision therefore resolved the ambiguity which BNY had been complaining about. As a result, on 25 February 2025, BNY gave its (contingent) consent to the amendment.

[173]The point is a very short one. In my judgment, BNY was entitled to press Nationwide to ensure clarity before consenting to the amendment. I do not agree that a litigant faced with a proposed amendment, the scope of which does not appear to match what the party making the amendment is saying about it, must always just give consent to the amendment and then rely upon what has been said in correspondence, or interrogate the amended pleading by way of request for Further Information. Perhaps the latter will be the more satisfactory course where the concern is really about whether sufficient particulars have been provided in respect of an amendment which is itself clear. But here the issue about the scope of the amendment was significant and had the potential to be relevant to the summary judgment application.

[174]In the end, parties to applications of this kind face costs risks if they find themselves on the wrong side of a judgement call. If Nationwide had stuck to its guns and refused to revise the formulation of the draft amendment, and then the Court had given permission for it, on the basis that BNY could have asked for Further Information, it seems likely that BNY would have had to pay the costs of the application. But that is not what happened. Nationwide backed down and, for my part, I take the view that it was right to do so. If Nationwide had sought to make the amendment in the original form, the mismatch between what it was saying in its evidence, and the way the amendment had actually been drafted, might well have led to a refusal.

[175]For completeness, I should note that Mr Valentin also argued that Nationwide should not have needed to make the application at all, because the amendment was contingent upon the summary judgment application, but BNY “forced” it to do so, by threatening to make its own application to the Court for directions. I was not sure whether this argument was said to remain relevant if the summary judgment application failed. If so, in that scenario, the argument takes Nationwide nowhere because, if A&O was going to be allowed to take its Confirmation Duty argument forward, Nationwide did need to amend, to address the circularity or “round-tripping exercise” point.

[176]If Nationwide wanted to amend, it needed either BNY’s consent or the permission of the Court. I have rejected the complaint that BNY should have consented at an earlier stage. It follows from what I have said that it was, in effect, Nationwide’s “fault” that it needed to make the application to amend, both in the usual sense that it was an amendment and in the sense that its original formulation generated concerns on the part of BNY.

[177]Accordingly, I will order that Nationwide must pay BNY’s costs of the application to amend, as part of the costs of and occasioned by the amendment.

Disposition

[178]I refuse the application for summary judgment insofar as it concerns A&O’s remaining Part 20 claim for a contribution.

[179]The costs order which I will make in relation to the application to amend is that Nationwide must pay the costs of that application in any event.

[180]I will hear the parties on any other consequential matters, such as to what extent I can and should be giving summary judgment on Nationwide’s claims against BNY and/or BNY’s cross-claims for an indemnity against Nationwide. I will also need to deal with any other applications for costs, including any request that I assess the costs of the application to amend now.

[181]I should end with my thanks to the parties’ legal teams for the care and skill with which the submissions and other materials were presented to me. The bundles were intimidating, spanning thousands of pages of transactional documents and authorities, but the way in which it was broken down and explained meant that it did not become unmanageable.

order

it submitted that, in the present case, there was an express written assumption of responsibility, which was (even if not actually contractual) closely akin to contract. On this basis, it contended that A&O’s case is a strong one.