Emmott v Michael Wilson & Partners Ltd

A post-judgment freezing injunction is intended to facilitate enforcement of an established liability. An ordinary-course-of-business, or Angel Bell, exception will usually be inappropriate where the judgment debtor has assets, refuses to pay and presents a continuing risk of dissipation. The exception may remain where it would assist execution, for example by enabling contracts to continue and producing further assets. The court must assess whether retaining or removing the exception is more likely to aid enforcement. A judgment creditor cannot generally be required to enforce in one foreign jurisdiction rather than another. An order requiring money held abroad to be brought into the jurisdiction is exceptional and should not be made merely because the court has jurisdiction to grant it.

The claimant sought relief in support of arbitration awards and a judgment enforcing them. The applications concerned the removal of the Angel Bell exception from a freezing injunction and the transfer to England of money held by the High Court sheriff in New Zealand. The claimant also sought declarations and an injunction concerning alleged cause of action estoppel and issue estoppel, but permission had not been given for those applications and they were unsuitable for determination on this application.

The awards were binding for domestic purposes, and leave had been given to enforce them as a judgment. The central issue was whether the ordinary-course-of-business exception should be removed to facilitate enforcement.

1. The application to remove the Angel Bell exception was granted. The court declined to determine the proposed estoppel declarations and injunction, and declined to order the transfer of the New Zealand funds.

2. There is a material distinction between a freezing injunction granted before liability is established and one granted after judgment. Before judgment, the injunction preserves assets pending determination of liability. After judgment, it is maintained to facilitate enforcement of an established liability. It is not itself a remedy of execution, but it supports the execution process.

3. Following Soinco v Novokuznetsk Aluminium Plant [1998] QB 406 and Masri v Consolidated Contractors International [2008] EWHC 2492 (Comm), an ordinary-course-of-business exception is generally inappropriate in a post-judgment freezing order, particularly in relation to bank balances. Mobile Telesystems Finance SA v Nomihold Securities Inc [2011] 2 CLC 857 qualified the principle: the exception may be retained where it assists execution, including by allowing continuing contracts to generate recoveries.

4. The relevant question is whether retaining or removing the exception would assist execution. Here, the judgment debtor could pay, had substantial assets, had resisted enforcement, had delayed enforcement by hopeless appeals and presented a continuing risk of dissipation. The foreign location of assets did not alter the principle. The exception was therefore removed.

5. The court would not interfere with enforcement proceedings in New Zealand. Although jurisdiction existed under Derby v Weldon and the dictum of Kerr LJ in The Niedersachsen, an order requiring money to be brought into the jurisdiction to police a freezing injunction was appropriate only in an exceptional case. This was not such a case.

Not stated in the judgment.