In the case of JSC VTB Bank v Skurilhin [2014] the court has granted a worldwide freezing order to assist proceedings in Russia. However, it restricted the effect of the order by holding that it did not apply to assets in Russia and in certain other countries with which Russia had entered international agreements.
Having been granted a domestic freezing injunction in support of proceedings issued in Russia, the claimant applied to extend it to a worldwide freezing order. The court held that it could grant the relief sought in accordance with its jurisdiction under either section 25 of the Civil Jurisdiction and Judgments Act 1982 (CJJA 1982) or section 37 of the Senior Courts Act 1981. However, the discretion to grant injunctive relief should be exercised only if it was expedient to do so applying the principles in Motorola Credit Corporation v Uzan (No 2) [2003].
In this case, the English proceedings were ‘parasitic’ on the substantive proceedings in Russia. It would be ‘odd’ if the court were to grant relief against assets with jurisdictions where the Russian court could, in principle, grant relief and had not refused to do so. Expert evidence indicated that the Russian courts were not generally opposed to granting interim relief in relation to assets in Russia, and would sometimes grant relief in relation to assets situated in countries with which Russia had entered an international agreement.
In the circumstances, it was not expedient to grant an injunction in relation to assets located in Russia, China, Cuba or Belarus. Interestingly, when ordering the disclosure of assets, the judge did not require a similar carve-out, and ordered the defendant to disclose details of his assets in all jurisdictions.
The decision illustrates that the court will be reluctant to take action that might be inconsistent with the approach of the court seised with the substantive dispute. It is also a reminder that before applying to the English courts for an injunction in support of foreign proceedings, a claimant should obtain advice on the relevant foreign law, and consider what alternative relief may be available.
Chris Harper is a partner and head of the dispute resolution team. He has been recognised by two independent guides to the law, Legal 500 and Chambers, as among the best in the region. Contact Chris on 01392 210700 or email drx@stephens-scown.co.uk.