Bank Notes

T - Third party nominees

31/10/18

FM CAPITAL PARTNERS LTD v MARINO [2018] EWHC 2889 (Comm); [2019] 1 WLR 1760

Assets covered by the standard form of freezing order include assets over which the respondent has control but which the respondent does not own (applying JSC BTA Bank v Ablyazov, 2015). The fact that the respondent is sole shareholder/director of a company does not mean the respondent has control of the company’s assets for this purpose (applying Lakatamia Shipping Co Ltd v Su, 2015). Conduct which diminishes the value of the respondent’s shareholding is prohibited and there may be cases where the company’s assets are in truth the respondent’s assets, such as a non-trading companies with no active business which are no more than “pockets or wallets of the respondent.” Even if the order does not prohibit dealing with a company’s assets, it may require prior notice of dealings as they may affect the value of the respondent’s shareholding.

31/7/15

WOOD v BAKER [2015] EWHC 2536

The court pierced the corporate veil of companies operated as agents/nominees for a bankrupt and granted an order to trustees in bankruptcy freezing assets held by the companies. The court considered appropriate terms of a limited cross-undertaking.

6/6/13

GROUP SEVEN LIMITED v ALLIED INVESTMENT CORP LIMITED [2013] EWHC 1509 (Ch)

Personal service of an application to commit for contempt may be dispensed with in exceptional circumstances. But a company could not be regarded as holding or controlling its assets in accordance with the respondent’s direct or indirect instructions within the meaning of the standard form freezing order, even if the respondent was the company’s sole director/shareholder. The fact that the respondent had procured the company to agree to accept a discounted sum in settlement of a debt owed to the company was not therefore a breach of the order made against him personally.

7/3/13

PJSC VSEUKRAINSKYI AKTSIONERNYI BANK v MAKSIMOV [2013] EWHC 422 (Comm)

The bank obtained freezing orders against companies which it claimed were nominees for an individual against whom it had a large damages claim. The companies applied to discharge the orders, denying that they were owned or controlled by the individual or that they held any relevant assets. The court summarised the principles on which freezing orders may be made against third parties in such cases (TSB v Chabra) and decided the orders should not be discharged.