Whether foreign freezing order can be enforced here before debtor appeal deadline passed

The claimant obtained a worldwide freezing order against the defendant in Cyprus and registered it as a judgment of the English court pursuant to EC Regulation 44/2001 (which applied as the order was obtained pre-January 2015). Of issue in this case was whether the freezing order then became immediately enforceable against a third party bank or whether it only became enforceable if no appeal was brought against the registration within the relevant two month period (or, if an appeal was brought, following the determination of that appeal). This was a novel issue which the English courts haven't addressed before.

Picken J concluded that the freezing order did not become fully enforceable and effective when the registration order was made. It would only become enforceable on determination of the defendant's appeal against registration. In reaching this conclusion, he placed reliance on Article 47(3) of the Regulation which provides that: "During the time specified for an appeal….against the declaration of enforceability and until any such appeal has been determined, no measures of enforcement may be taken other than protective measures against the property of the party against whom enforcement is sought". The judge concluded that the claimant had sought to take "measures of enforcement" by serving the registration order and freezing order on the third party bank. However, the claimant had already achieved its objective of freezing the defendant's bank accounts. Accordingly, there was no need for the claimant to pursue "protective measures" (such as applying for a further freezing order from the English court). The claimant was therefore not entitled to serve the Cypriot freezing order on the third party bank pending the determination of the defendant's appeal against registration.

Case Alert - [2016] EWHC 1442 (QB)