Whether the court can grant a freezing order against third parties who were outside the jurisdiction and not a party to the relevant arbitration  agreement


The claimant obtained an arbitration award against an Indian company. This was not paid, and so a  worldwide freezing order was made against the company. The claimant then also sought to freeze assets belonging to third parties (ie Chabra relief). The issue in this case  was whether the court had jurisdiction to make such an order (and so allow service out of the  jurisdiction), given that the third parties are all incorporated outside England and Wales, have no  assets or other presence here, and were not a party to the arbitration agreement. Males J held as  follows:

  1. CPR r62.5(1)(c) provides that the court may give permission to serve an arbitration claim form  out of the jurisdiction if the claimant “seeks some other remedy… affecting an arbitration, an  arbitration agreement or an arbitration award”. The other remedy is a remedy other than a challenge  or appeal of the award or a claim for  an order under section 44 of the Arbitration Act 1996 (i.e.  court powers exercisable in support of arbitration eg the granting of an injunction or the  preservation of evidence or (if urgent) assets). Following a review of prior caselaw, the judge concluded that service out of the jurisdiction under  this rule is permissible only against a party to the arbitration agreement or arbitration in  question. Accordingly, the court had no jurisdiction to give permission under this rule in this  case.
  2. The judge did accept that CPR r62.5(1)(c) could apply to proceedings brought to enforce an  award and that an application for a post-award freezing order against the debtor itself did amount  to an “arbitration claim” and so the court would have power to grant permission to serve out in  those circumstances.
  3. The claimant did not seek to rely on CPR r62.5(1)(b),   which allows the court to give  permission for service out where the claim is for an order under section 44. However, it did seek to argue that as relief under section 44 is available against a non-party, the same should apply to an application under r62.5(1)(c). However,  Males J held that section 44 does not include any power to grant a remedy against a non-party.  Section 44 is one of the few sections  of the Act which applies even if the seat is outside England  and Wales, and the judge doubted that Parliament intended to give the English court jurisdiction to  make orders against non-parties in support of arbitrations happening anywhere in the world.
  4. PD 6 para 3.1(3) provides that where a claim is made against (effectively) an “anchor  defendant”, the claimant can be given permission to serve out if it wishes to serve a claim form on  another person who is a necessary or proper party to the claim against the anchor defendant.  However, Males J held that this gateway requires a substantive claim against the anchor defendant  and an application for a freezing order against the Indian company did not amount to a substantive  claim against it (the substantive claim having been determined in the arbitration). Accordingly,  permission could not be given under this gateway either.