Case Alert ‐ [2017] EWHC 2747 (Ch)

Court examines whether risk of dissipation had been proven in an application for a freezing injunction

The claimant sought a freezing injunction over assets located outside England and Wales (shares in a Jersey company). One of the issues in this case was whether there was a risk of dissipation where it was uncontested that the defendant intended to dispose of the shares and send most of the proceeds to Thailand, where he has lived for several years. There was no evidence that use of those sums would "simply form a seamless part of his ordinary course of business or living" (and so there was a risk that the assets would be inappropriately dissipated).

However, the defendant sought to argue that this did not mean that the judgment would not be satisfied. The judge noted that "Where, however, the transfer is not in the ordinary course of business or living, then an intended transfer to an overseas jurisdiction may provide sufficient basis for an injunction once the court considers its effect on whether the judgment will be met. The hurdle does not appear overly onerous".

Here, the fact that the defendant had complied with court orders made by the trial judge and others did not negate the risk of dissipation in the absence of a court order. Nor was the judge persuaded by the defendant's argument that, even if the share proceeds were dissipated, there was no risk that any judgment would go unsatisfied (the judge accepted that these were two different aspects which had to be proven separately but also added that "in most contexts…proof of the necessary risk of dissipation would carry the risk that the judgment would not be met"). There was no evidence here that the defendant would take certain necessary further steps to ensure that the judgment was satisfied voluntarily.

Accordingly, the freezing injunction was ordered.