Anami Holdings & Anor v Gill & Anor

Where a consent order postpones enforcement until specified conditions are breached, the court must identify the precise contractual or order-based event triggering enforcement. An obligation to use best endeavours to procure security is distinct from an obligation to procure that the security becomes enforceable as a first charge by a specified date. Enforcement before the stipulated date is premature.

A stay of proceedings limits applications to steps genuinely required to carry the settlement terms into effect or discharge an injunction. It does not ordinarily permit an application which substantially strengthens a freezing order. Orders requiring evidence or disclosure should be proportionate, supported by a fair opportunity to respond, and must not reverse the claimant’s burden of proving breach.

The claimants alleged that the defendant had defrauded them and obtained freezing relief. In July 2014 the parties entered into a consent order and confidential settlement agreement. The order recorded judgment for the agreed settlement sum, stayed enforcement, continued the freezing injunction, and required the defendant to procure security over property and provide information concerning an arbitration award.

The claimants applied to lift the stay of enforcement, transfer funds held in Abu Dhabi, compel execution of a second charge, and require further affidavits and information. The defendant disputed the relief and maintained that the settlement had been procured by duress or undue influence, although the court treated the existing consent order as binding at this stage. The central issues were whether the requested orders fell within the permission to carry the settlement into effect and whether they were premature or procedurally unfair.

1. Enforcement of the settlement judgment. The claimants could enforce the judgment only upon the event identified in paragraph 4 of the schedule to the consent order. That event was failure, by 5 November 2014, to procure payment of sums outstanding to the Bank of Ireland so that the second charge became a first legal charge. A possible present breach of the separate best-endeavours obligation to procure the second charge was not the specified enforcement event. The application for judgment for £2.5 million was therefore premature.
2. Opportunity to answer the evidence. Whether the defendant had used his best endeavours was a matter on which he was entitled to give evidence. Because the claimants’ evidence had been served only shortly before the hearing, the court declined to order execution of the second charge at that stage.
3. Scope of the stay. The proposed transfer of the Abu Dhabi funds would strengthen the freezing injunction. It was not a step required to carry the settlement terms, the consent order, or the schedule into effect, and therefore fell outside the saving provision in the stay. The further asset, liability, arbitration-award and charge-related orders were likewise not made at this hearing. Some might be appropriate after the defendant had answered the evidence, but others were impermissible or unsupported.
4. Disclosure concerning expenditure. The defendant had failed fully to comply with earlier orders requiring disclosure of expenditure on ordinary living expenses and legal advice and the source of the money used. Borrowed money was still money received and spent by him. He was accordingly required to swear and serve an affidavit dealing with those matters.
5. The court declined all other orders sought on the application.

First-instance application within ongoing proceedings. The judgment records an earlier consent order made by Arnold J on 17 July 2014, but no appeal from that order was determined in this judgment.