Westlb AG v Nomura Bank International Plc & Anor

Westlb AG v Nomura Bank International Plc & Anor

The appeal was dismissed because WestLB failed to prove that Nomura International, acting rationally and honestly, would have valued the Fund assets at more than the fee as at 30 September 2008. The physical delivery notice did not constitute a binding NAV determination, and there was insufficient evidence to support a discounted value approach. The contractual discretion remained with Nomura, and the court could not substitute its own assessment absent proof of loss.

Parties
Appellant/claimant: WestLB AG; Respondent/defendant: Nomura Bank International PLC; Respondent/defendant: Nomura International PLC
Jurisdiction
England and Wales
Judgment Date
24 April 2012
Procedural Posture
Civil Appeal / Judgment on Appeal
Outcome
appeal dismissed
Legal Topics
Valuation of Illiquid Assets, Contractual Discretion, Damages Assessment, Market Value Determination
Contract Law Financial Instruments Valuation of Illiquid Assets Contractual Discretion Damages Assessment Market Value Determination

Case Brief

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Parties

WestLB AG

Appellant/claimant

Nomura Bank International PLC

Respondent/defendant

Nomura International PLC

Respondent/defendant

Procedural Posture

Civil Appeal / Judgment on Appeal

Legal Issues

  1. 1 Whether Nomura Bank's physical delivery notice constituted a binding determination of NAV under the contract
  2. 2 Whether Nomura International's valuation of the Fund was irrational or in bad faith
  3. 3 Whether the Fund assets had any material value as at 30 September 2008

Ratio Decidendi

The appeal was dismissed because WestLB failed to prove that Nomura International, acting rationally and honestly, would have valued the Fund assets at more than the fee as at 30 September 2008. The physical delivery notice did not constitute a binding NAV determination, and there was insufficient evidence to support a discounted value approach. The contractual discretion remained with Nomura, and the court could not substitute its own assessment absent proof of loss.

Court Disposition

appeal dismissed