Title:	Ryanair Plc -v- Aer Rianta Cpt
Neutral Citation:	[2003] IESC 62
Supreme Court Record Number:	234/02
High Court Record Number:	1999 9764P
Date of Delivery:	12/02/2003
Court:	Supreme Court
Composition of Court:	Denham J., Fennelly J., McCracken J.
Judgment by:	Fennelly J.
Status:	Approved
Result:	Allow And Vary
Judgments by Link to Judgment Concurring Fennelly J. Link Denham J. McCracken J. Link Denham J.

BETWEEN

1. This is the defendant’s appeal from the judgment and order of Lavan J dated 31st July 2002, whereby he ordered discovery of documents by the defendant. The protagonists to the litigation are respectively the airline operator, Ryanair plc and Aer Rianta cpt, which operates Dublin, Cork and Shannon airports. I will describe the parties as Ryanair and Aer Rianta.

2. The action was commenced in September 1999. In its Statement of Claim, delivered on 22nd November 1999, Ryanair alleges that Aer Rianta had committed and was continuing to commit various breaches of both national and European Community competition law.

3. In order to consider the appeal from the order of Lavan J and the scope of discovery, if any, which should be ordered, it is necessary to consider the nature and extent of the allegations of anti-competitive behaviour alleged by Ryanair and the response of Aer Rianta, as pleaded in its defence filed on 13th July 2000.

4. Ryanair claims that Aer Rianta, as the operator and manager of the three airports mentioned is a monopoly provider of essential facilities and airline facilities to airlines using those airports. These services include such aspects of airport services, to mention but a few, as check-in desks, baggage belts and other passenger facilities as well as runways, cargo facilities, hangars and emergency services. Ryanair says that Aer Rianta occupies a dominant position in the market for the provision of those services in the State, for the purposes both of Article 82 of the Treaty establishing the European Community and section 5 of the Competition Act, 1991 and that it has abused and continues to abuse that position.

5. Ryanair also says that, in 1998, Aer Lingus was the largest passenger carrier through Dublin Airport. It says that it competes with Aer Lingus in the provision of travel services from that Airport. Aer Lingus is its main competitor. In the Statement of Claim, it cites figures, over the relevant period, of 3,350,000 passengers for itself and 2,300,000 for Aer Lingus, though acknowledging that Aer Rianta maintains that the correct Aer Lingus figure is 3,450,000.

6. Ryanair says that Aer Rianta and Aer Lingus are owned by the same shareholder, the State, which also acts as regulator of air transport and airports.

7. Ryanair also alleges that Aer Rianta entered into various agreements, decisions or concerted practices with Aer Lingus, which had as their object or effect the prevention, restriction or distortion of competition in the State. In effect, Ryanair alleges that Aer Rianta has used and continues (at least up to the date of the events pleaded) to use its dominant position and its alleged relationship with Aer Lingus to favour the latter at the expense of Ryanair.

8. Ryanair alleges anti-competitive behaviour against Aer Rianta, effectively in consort with or discriminating in favour of Aer Lingus. These allegations fall under some six principal headings, as well as a collection of miscellaneous complaints, which I list below as a seventh group. The following is a broad summary of the allegations:

1. Allocating to Ryanair only 15 check-in desks and a half of a baggage belt, while allowing 56 check-in desks and 3 baggage belts to Aer Lingus, all this without taking account of relevant matters such as relative passenger numbers carried by each airline and certain spare capacity said to be enjoyed by Aer Lingus;

2. Planning a cut-back of facilities, in order to facilitate construction works in the main terminal building at Dublin Airport in 1999, so that Ryanair would lose 3 of their 15 check-in desks while Aer Lingus were to be reduced from 56 to 48, (the poorer quality facilities provide for Ryanair meaning an effective reduction from 15 to 8), all this without any objective justification or any proper consultation of Ryanair, but after negotiation with Aer Lingus to the exclusion of Ryanair;

3. Introducing a fuel levy at Dublin airport, without any objective justification and, unlike BAA on introducing a similar levy in the United Kingdom, providing no service in return;

4. Introducing a compulsory service called “CUTE” (Common User Terminal Equipment), which is of value only to airlines using a computer ticketing system, but is of no value to Ryanair, which maintains a low cost system of its own;

5. Discriminating in favour of Aer Lingus by facilitating its building and operation of its own hangars, while refusing like facilities to Ryanair, and discriminating also in relation to the construction and funding for Aer Lingus of a new check-in area on favourable terms;

6. Depriving Ryanair of a discount previously enjoyed for the use of Pier A, which is low-cost, inferior and less convenient, in particular requiring Ryanair to cross-subsidise the newly-constructed Pier C used by high-cost airlines;

7. Discriminating against Ryanair and in favour of Aer Lingus: in relation to VIP lounge facilities; in refusing (prior to1995) to permit Ryanair passengers to have direct access to Pier A; in refusing to allow Ryanair to employ its own contractors such as a third-party handling agent, thus compelling it to employ a subsidiary of its competitor, Aer Lingus; employing Aer Lingus, to the exclusion of Ryanair, for flights by its own staff; by omitting Aer Lingus transfer passengers from its computation of passenger charges, Ryanair not having any such passengers.

10. The defence of Aer Rianta amounts, in almost every instance, to a traverse and denial of all the allegations, including almost every material allegation of commercial fact made in the Statement of Claim. One exception is that it pleads that, in order to facilitate essential construction works at Dublin Airport, it had to relocate and reallocate facilities on a temporary basis, while denying that it put in place plans such as alleged by Ryanair.

11. There followed two replies by Ryanair to requests for particulars. Some controversy, however, surrounds a letter of 15th December 2000 in which Ryanair’s solicitors gave notice of intention to rely on “additional information” as additional particulars of the claim. Aer Rianta maintains that this material, in reality, amounts to an impermissible expansion of the claim, which would require an amendment of the Statement of Claim. This matter is considered in the judgment of McCracken J. I agree with his account and his conclusions.

12. Solicitors for Ryanair wrote a preliminary letter on 22nd December 2000 seeking voluntary discovery in accordance with the provisions of Order 31, rule 12(4) of the Rules of the Superior Courts. The request specified classes of documents under 15 headings, supported by stated reasons. The letter proposed six weeks for compliance with the request. Aer Rianta, while expressing willingness to make appropriate discovery, claimed that “many of the categories sought [were] irrelevant and not necessary to decide the matters at issue .”

13. After the Motion, seeking discovery in the same terms as the letter of 22nd December, had been issued, Aer Rianta wrote a lengthy response to the request, outlining its objections to the scope of the discovery sought and alleging failure by Ryanair to comply with the requirements of the relevant rule, in particular by describing the documents sought only in the most general terms and by failing to pinpoint the categories of documents as indicated in the case law. Ryanair joined issue with these points in a letter dated 14th March 2001, but accompanied its letter with a new version of its request, containing some minor amendments to the letter of request for voluntary discovery of 22nd December 2000.

14. Aer Rianta’s objections to the request for discovery were repeated in written submissions made in the High Court. In essence they were

i. Non-compliance with Order 12, rule 1, as amended in 1999, by failing adequately to specify the documents or categories of documents sought;

ii. Inclusion of requests relating to matters alleged in the letter of 15th December 2000;

iii. Lack of necessity for discovery where Ryanair were able to establish the facts, as pleaded in the Statement of Claim and sworn in affidavits;

iv. Failure to give reasons showing necessity for the discovery.

16. The learned trial judge gave judgment on 31st July 2002. He held that “the plaintiff’s objections to the perceived views of the Swords judgment are correct.” He continued: “The defendants have a fundamental obligation as to the strategic and economic use of Irish facilities given the dominant position of the defendants it seems to me that the Court must look very carefully at the request of discovery.” Insofar as this passage appears implicitly to determine one of the major issues in the action, it should not have done so. Furthermore, although it indicates an intention to examine the request for discovery very carefully, the learned trial judge merely directed Aer Rianta “to answer all of the plaintiff’s requirements for discovery.”

17. In fact, through inadvertence, the order was made by reference to the first request for voluntary discovery, as contained in the Notice of Motion, and not, as was intended, the amended request of 14th March 2001. It has been agreed that, for the purposes of the appeal, the latter is the material request.

18. Aer Rianta has appealed to this Court against the entire of the judgment and order of the High Court.

19. Mr Paul Sreenan, Senior Counsel, on behalf of Aer Rianta restated the submissions that Ryanair had not complied with the requirements of Order 31, rule 12, and that the requests for discovery were too vague and unspecific. The principal basis of his attack on the High Court order was, however, that Order 31, rule 12 was amended in 1999 with the effect of substantially changing the law regarding discovery. The rule now requires an applicant for discovery to swear an affidavit verifying that discovery is “necessary for disposing fairly of the cause or matter” and furnishing “reasons why each category of documents is required to be discovered.” He relied strongly on the judgment of Morris P. in Swords Proteins as establishing the obligation of the applicant to specify with precision the precise categories of documents sought. He advanced the further argument that, following amendment of the rule, discovery is much more difficult to obtain. The applicant has the burden of proving, not only compliance with the rule, and the relevance of the documents sought but, in addition, that discovery of the documents is necessary for the purpose of fairly disposing of the cause or matter. Whereas Finlay C.J., in Allied Irish Banks plc v Ernst & Whinney [1993] 1 I.R. 375, at page 388, may have laid the burden of establishing that discovery is not necessary on the party against whom discovery is sought, and, assuming that not to be an obiter dictum, the position has been expressly altered by the requirement in the rule, as amended, which obliges the applicant to verify necessity. He argued that Ryanair had other means of establishing most of the relevant facts, such as the service of notices to admit facts or documents or calling witnesses from Aer Lingus.

20. Mr Bill Shipsey, Senior Counsel, on behalf of Ryanair submitted that the 1999 amendment did not effect any change in the substantive law of discovery. It introduced the requirement of a preliminary request for voluntary discovery and of a verifying affidavit. The effect was to eliminate the right to obtain an order for general discovery or to obtain any discovery without a grounding affidavit. The existing principles regarding relevance and necessity are unchanged. Counsel cited the judgment of Lynch J in Brooks Thomas v Impac Limited [1999] I.L.R.M. 171 and its reference to the celebrated dictum of by Brett L.J. in Compagnie Financière v Peruvian Guano Company [1882] 11 Q.B.D. 55 at 63 (quoted below).

21. On the question of necessity, counsel referred to the judgment of Kelly J, in the High Court in Cooper-Flynn v RTE [2000] 3 I.R. 343. None of the authorities, in particular none of the Irish authorities, support the Aer Rianta argument that the right to discovery is contingent on the exhaustion of other procedures. An applicant is entitled to discovery even if the facts in question could be established by other means.

Conclusion

22. It is appropriate to commence by setting out the terms of Order 31, rule 12. Statutory Instrument No. 233 of 1999 substituted, so far as relevant, the following for the existing text of Order 31, rule 12:

"(1) Any party may apply to the Court by way of notice of motion for an order directing any other party to any cause or matter to make discovery on oath of the documents which are or have been in his or her possession or power, relating to any matter in question therein. Every such notice of motion shall specify the precise categories of documents in respect of which discovery is sought and shall be grounded upon the affidavit of the party seeking such an order of discovery which shall:

(a) verify that the discovery of documents sought is necessary for disposing fairly of the cause or matter or for saving costs;

(b) furnish the reasons why each category of documents is required to be discovered.


(2) On the hearing of such application the Court may either refuse or adjourn the same, if satisfied that such discovery is not necessary, or not necessary at that stage of the cause or matter, or by virtue of non-compliance with the provisions of sub-rule 4(1), or make such order on terms as to security for the costs of discovery or otherwise and either generally or limited to certain classes or documents as may be thought fit.

(3) An order shall not be made under this rule if and so far as the Court shall be of the opinion that it is not necessary either for disposing fairly of the cause or matter or for saving costs.

(4) (1) An order under sub-rule 1 directing any party or under rule 29 directing any other person to make discovery shall not be made unless:


(a) the applicant for same shall have previously applied by letter in writing requesting that discovery be made voluntarily, specifying the precise categories of documents in respect of which discovery is sought and furnishing the reasons why each category of documents is required to be discovered; and

(b) a reasonable period of time for such discovery has been allowed; and

(c) the party or person requested has failed, refused or neglected to make such discovery or has ignored such request.


Provided that in any case where by reason of the urgency of the matter or consent of the parties, the nature of the case or any other circumstances which to the Court seem appropriate, the Court may make such order as appears proper, without the necessity for such prior application in writing.

(2) Any such discovery sought and agreed between parties or between parties and any other person shall, subject to sub-rule 4 below, be made in like manner and form and have such effect as if directed by order of the Court.

24. Morris P. interpreted the object and effect of these changes in his judgment in Swords v Western Proteins Ltd:

“I am satisfied that the amendment to Order 31 Rule 12 was made for the purpose of addressing a problem which had given rise to delays and potential injustices over a number of years. A practice had developed whereby Orders for Discovery were obtained unnecessarily and such Orders delayed litigation. As has been pointed out by the Courts on a number of occasions Discovery before the advent of the photocopying machine, fax, e-mail and word processors would probably involve the Discovery of a dozen documents. In recent years the number of documents discovered can amount to many thousands and the process has become unmanageable.

Accordingly I believe that Statutory Instrument 223 of 1999 imposed a clearly defined obligation upon a Party seeking Discovery to pinpoint the documents or category of documents required and required that Party to give the reasons why they were required. Blanket Discovery became a thing of the past. The new rule was brought into being to ensure in the first instance that the Party against whom Discovery was being sought would, upon receipt of the preliminary letter, be in a position to know the document or category of documents referred to and be able to exercise a judgment on whether the reasons given for requiring these documents to be discovered was valid. He would then be in a position to know if he was required to comply with the request. If he disputed his obligation to make Discovery the court would know by reference to this letter precisely why the Moving Party sought the documents in question and the grounds upon which the Moving Party believed that the documents sought to be discovered might help to dispose fairly of the cause or save costs.”

26. Mr Sreenan contends, nevertheless, that, principally because of the amendment of the rule, there is a burden on the applicant for discovery to prove the necessity of the discovery sought for the purpose of fairly disposing of the cause or matter. As already indicated, the 1999 amendment did not change the parts of the rule dealing with the necessity for discovery. Rule 2, whose wording formerly formed part of rule 1, gives the court a broad discretion to refuse discovery where it considers it not necessary or not necessary at that stage. Rule 3 is expressed in mandatory terms:

“An order shall not be made under this rule if and so far as the Court shall be of the opinion that it is not necessary either for disposing fairly of the cause or matter or for saving costs.”

28. It is impossible to resist the conclusion, however, that the amendment to the rule has shifted the primary burden of proof. The applicant must, under the present rule, discharge the prima facie burden of proving that the discovery sought “is necessary for disposing fairly of the cause or matter.” This is not a mere formalistic requirement: the affidavit must, in addition, “furnish the reasons why each category of documents is required.” In context, there is no meaningful distinction between the words, “necessary” and “required.” The latter term is implicitly referable to the objective of the fair disposal of the cause or matter. The nature of this burden is considered further below.

29. Apart from this alteration of the prima facie burden of proof, it is clear that the rule made no serious or fundamental change in the law regarding discovery of documents. The definition by Brett L. J. remains the universally accepted test of what is the primary requirement for discovery, namely the relevance of the documents sought:

“It seems to me that every document relates to the matters in question in the action, which not only would be evidence upon any issue, but also which, it is reasonable to suppose, contains information which may - not which must - either directly or indirectly enable the party requiring the affidavit either to advance his own case or to damage the case of his adversary. I have put in the words "either directly or indirectly," because, as it seems to me, a document can properly be said to contain information which may enable the party requiring the affidavit either to advance his own case or to damage the case of his adversary, if it is a document which may fairly lead him to a train of inquiry .”

31. In the great majority of cases, discovery disputes have revolved around the issue of relevancy. There are fewer cases concerning necessity. There are good reasons for this. If there are relevant documents in the possession of one party, it will normally be unfair if they are nor available to the opposing party. Finlay C. J., in his judgment in Smurfit Paribas Bank Limited v. A.A.B. Export Finance Limited. [1990] 1 I.R. 469 emphasised “the full disclosure both prior to and during the course of legal proceedings which in the interests of the common good is desirable for the purpose of ascertaining the truth and rendering justice.” The overriding interest in the proper conduct of the administration of justice will be the guiding consideration, when evaluating the necessity for discovery.

32. The issue of “necessity” for discovery has, consequently, usually been debated in cases where some other interest is involved, particularly the confidentiality of documents, especially where they involve the interests of third parties. To that extent, the arguments advanced on behalf of Aer Rianta on this appeal, effectively that Ryanair does not need the documents, because they have alternative means of establishing the relevant facts, has rarely arisen.

In order to establish that discovery of particular categories of documents is “necessary for disposing fairly of the cause or matter,” the applicant does not have to prove that they are, in any sense absolutely necessary. Kelly J considered the matter in his judgment in Cooper Flynn v Radio Telefís Eireann [2000] 3 I.R. 344. He derived the useful notion of “litigious advantage” from certain English cases. He adopted the following statement of Bingham M.R. in Taylor v Anderton [1995] 1 W.L.R. 447 at 462:

“The crucial consideration is, in my judgment, the meaning of the expression 'disposing fairly of the cause or matter'. Those words direct attention to the question whether inspection is necessary for the fair determination of the matter, whether by trial or otherwise. The purpose of the rule is to ensure that one party does not enjoy an unfair advantage or suffer an unfair disadvantage in the litigation as a result of a document not being produced for inspection. It is, I think, of no importance that a party is curious about the contents of a document or would like to know the contents of it if he suffers no litigious disadvantage by not seeing it and would gain no litigious advantage by seeing it. That, in my judgment, is the test.”

34. The change made in 1999 exemplifies, however, growing concern about the dangers of unnecessarily costly and protracted litigation and, in particular, the burdens on parties and the courts arising from excessive resort to automatic blanket discovery. The public interest in the proper administration of justice is not confined to the relentless search for perfect truth. The just and proper conduct of litigation also encompasses the objectives of expedition and economy.

35. The court, in exercising the broad discretion conferred upon it by Order 31, rule 12, sub-rules 2 and 3, must have regard to the issues in the action as they appear from the pleadings and the reasons furnished by the applicant to show that the specified categories of documents are required. It should also consider the necessity for discovery having regard to all the relevant circumstances, including the burden, scale and cost of the discovery sought. The court should be willing to confine categories of documents sought to what is genuinely necessary for the fairness of the litigation. It may have regard, of course, to alternative means of proof, which are open to the applicant. These may, no doubt, include the possible service of notices to admit facts or documents. But there are two sides to litigation. The behaviour of the opposing party is relevant. That party may, for example, have made or may offer to make admissions of facts, and thus persuade a court that discovery on some issues is not necessary. This is, perhaps, axiomatic. Those facts will no longer be in issue. On the other hand, it is difficult to see how a party, such as Aer Rianta in the present case, which contests all the relevant facts on the pleadings and has formally objected to the right of its opponent to resort to affidavit evidence, can plausibly ask the court to deprive its opponent of access to documents which will enable it prove matters which it disputes.

36. In the present case, I am satisfied that Ryanair has sufficiently specified the categories of documents in respect of which it seeks discovery, for the purpose of compliance with the rule. It does not follow that the court will not cut down the categories specified. It has also sufficiently verified that discovery of these categories is necessary for the fair disposal of the action and has complied with its obligation to give reasons why each category is required. I do not accept that Aer Rianta has shown that their discovery is not necessary. In particular, I reject that contention that Ryanair has sufficient alternative means of proving the relevant facts to deprive it of its right to discovery. A notice to admit facts or documents is not a means of proof. It does not, I think lie in the mouth of a party, which has denied almost all of the pleaded facts, and put the opposing party to proof, to evade discovery by claiming that the facts can easily be proved. Competition cases have, as McCracken J suggests in his judgment, the special feature that any documents relating to anti-competitive behaviour, whether by being party to agreements or concerted practices or protecting a dominant position, are likely to be in the possession of the party engaged in that behaviour. Anti-competitive agreements or practices will be kept secret.

37. I agree with the judgment of McCracken J with regard to the analysis of the requests for discovery and the order he proposes. In the result, the appeal should be allowed but only to the extent to which the order for discovery is to be varied in the manner proposed by McCracken J.