What’s in the freezer? A guide to freezing injunctions
Freezing injunctions, or Mareva injunctions as they were formerly known, are powerful interim remedies in English civil procedure. Their purpose is not to decide the merits of a claim, but to ensure that any eventual judgment is not rendered worthless by the defendant dissipating assets in advance of enforcement.
Origins and conceptual footing
Historically, the courts adhered to a strict orthodoxy: a claimant had no right to restrain a defendant’s dealings with assets before obtaining judgment. The logic was simple: until liability was established, the defendant remained free to use his property as he wished.
That position shifted dramatically in 1975 when the Court of Appeal in Mareva Compania Naviera v International Bulk Carriers fashioned what is now the freezing injunction. The court granted relief restraining the defendant from removing or disposing of assets within the jurisdiction, especially where there was a real risk that enforcement would otherwise be frustrated.
It is now accepted that the jurisdiction derives from the court’s broad statutory power under section 37 of the Senior Courts Act 1981 to grant injunctions where “just and convenient”. The courts have recognised variants such as the “notification injunction”, requiring advance notice of dealings with assets rather than imposing a prohibition.
Nature and function
A freezing injunction is an in personam order, operating against the defendant personally and restraining conduct rather than conferring proprietary rights. Crucially, it does not give the claimant any security or interest in the assets themselves. Its function is purely protective and preserves the status quo so that a judgment, if obtained, can be enforced.
These orders are typically sought at an early stage of proceedings, often without notice to the defendant. Without notice applications will only be entertained if the applicant can demonstrate some urgency, and are subject to a strict duty of full and frank disclosure.
Unlike many interim injunctions, freezing injunctions commonly continue beyond trial until judgment is satisfied. While usually directed at the defendant, the court may also grant relief against third parties in certain circumstances, e.g., where assets that are held in another’s name are arguably beneficially owned by the defendant.
Legal basis
For many years, the decision in The Siskina was taken to require that a freezing injunction could only be granted where there was an existing cause of action justiciable. In 2021, the Privy Council in Broad Idea International Ltd v Convoy Collateral Ltd rejected the rigid requirement of a pre-existing domestic cause of action, emphasising instead the breadth of the court’s equitable and statutory jurisdiction.
The modern test focuses on three elements. First, the claimant must have, or have a good arguable case for obtaining, an enforceable judgment for a sum of money. Second, the defendant must have assets against which that judgment could be enforced. Third, there must be a real risk that, absent the injunction, the defendant will deal with those assets in a way that renders enforcement ineffective (i.e. dissipation risk). The jurisdiction extends to dissipation both within and outside England and Wales.
Key principles
The courts have developed a structured set of principles to guide the exercise of this exceptional jurisdiction. As mentioned, full and frank disclosure is fundamental. In without notice applications, the claimant must disclose all material facts, including those adverse to the application. Failure to do so can lead to the injunction being discharged, even if the underlying merits are strong.
The court retains discretion, however, and will consider factors such as the seriousness of the omission and resulting prejudice. The claimant must demonstrate a “good arguable case”. This is a modest threshold: more than merely arguable, but less than a probability of success. The court will not conduct a mini-trial. Once relief is obtained, the claimant must pursue the substantive claim with expedition.
As to assets, the jurisdiction has evolved significantly. While historically limited to assets within England and Wales, the courts now routinely grant worldwide freezing orders. “Assets” are construed broadly to include jointly owned property and assets under the defendant’s control, including beneficial interests under a trust. However, property held purely as trustee for another is generally excluded unless expressly covered. The requirement of a real risk of dissipation is central. Dissipation includes dealings such as transfers, charges or pledges that reduce the availability of assets. The risk must be real and evidenced.
The injunction must also be necessary. If the claimant already has effective security, or alternative measures (such as set-off) are available, relief may be refused. The court’s aim is not to improve the claimant’s position but to prevent injustice. Finally, the claimant must give the “usual cross-undertaking in damages”, compensating the defendant (and potentially third parties) if it later transpires that the injunction should not have been granted. In appropriate cases, this may need to be fortified by security.
Form and operation of the order
The standard form of freezing order is set out in CPR PD25A. The order must specify a financial cap aligned with the value of the claim. It identifies the assets affected, either specifically or by general description, and outlines prohibited dealings, from removal from the jurisdiction to any disposal or diminution in value. A key feature is the obligation on the defendant to disclose assets, initially in writing and later verified by affidavit. This ensures transparency and enables the claimant to assess enforcement prospects.
Defendants are ordinarily permitted to meet reasonable living expenses and legal costs, and to transact in the ordinary course of business. These exceptions are construed narrowly and may be tailored to the circumstances. Provision is made for variation or discharge, allowing both defendants and affected third parties to seek relief from the court where appropriate.
Third parties
Although the injunction binds only the defendant, third parties must not knowingly assist in its breach. Banks, in particular, play a pivotal role: once on notice, they must not process transactions that would contravene the order. However, they do not owe a general duty of care to the claimant merely by virtue of the injunction’s existence.
The court will proceed with caution where third parties are significantly affected. It may refuse relief, tailor the order, or require undertakings to mitigate prejudice. The claimant is often required to indemnify banks for compliance costs.
Worldwide freezing orders
Worldwide freezing orders represent the most far-reaching form of relief. Although formally in personam, their practical effect is to restrain dealings with assets globally. Because of their potential to interfere with foreign legal systems and commercial activity, they are granted sparingly and only on cogent evidence.
The court will consider comity, proportionality, and the connection to England. Further, safeguards are usually imposed, such as undertakings not to enforce the order abroad without permission. While available both pre- and post-judgment, their use in support of foreign proceedings or arbitration is approached with particular caution.
Ancillary relief
To ensure effectiveness, freezing injunctions are often supplemented by ancillary orders. These may include detailed disclosure obligations, orders directed at third parties (such as banks), or even cross-examination on affidavits. In extreme cases, the court may order delivery up of assets or impose travel restrictions through the writ of ne exeat regno. Such measures are only used where necessary to prevent relief from being undermined. The court remains mindful of proportionality and the availability of less intrusive alternatives.
Conclusion
Freezing injunctions are powerful, flexible, and inherently intrusive. Their grant remains tightly controlled. The court’s task is to strike a balance between protecting the integrity of its process without imposing unjustified constraints on defendants or third parties.
