Ivanhoe Mines Ltd v Gardner

A post-judgment freezing order requires evidence of a real risk of unjustified dissipation which may cause the judgment to go unsatisfied. The inquiry remains fact-sensitive. Non-payment of a judgment debt, without more, is insufficient. The court may consider the debtor’s conduct, the nature and liquidity of assets, the debtor’s response to the proceedings, and the practical difficulties and disproportionate cost of enforcement against particular assets or in another jurisdiction. The order must serve the legitimate purpose of preserving assets for enforcement, rather than pressurising payment. Where that risk is established, a freezing order may be continued despite the existence of other assets against which enforcement is theoretically possible.

The claimant sought continuation of a worldwide freezing order granted without notice after obtaining judgments against the defendant arising from a consent arbitration award and subsequent Tomlin Order. The defendant had unsuccessfully applied to set aside the judgment entered in his absence. That application was refused by Mr Justice Teare in [2019] EWHC 3142 (Comm), and no appeal was brought.

The issues were whether there was a real risk that the judgment debt would be defeated by unjustified dissipation of assets and whether it was just and convenient to continue the order. The court also considered ancillary notification, information, expense, fortification and costs provisions.

1. The freezing order was continued substantially in its existing form. The claimant established a real risk of dissipation through the cumulative effect of the defendant’s previous efforts to make enforcement difficult, his continuing resistance to the judgments, his refusal to make payment despite apparently sufficient assets, the liquidity of various assets, and the anticipated difficulty and delay of enforcement in Spain.
2. The requirement for post-judgment relief remains a real risk that assets will be unjustifiably dissipated so that the judgment may go unsatisfied. Although some authorities suggest that the requirement may be easier to satisfy after judgment, the facts of each case must be considered. The principles summarised in National Bank Trust v Yurov [2016] EWHC 1913 were accepted.
3. Refusal to pay a judgment debt is not, standing alone, sufficient. The Civil Procedure Rules provide enforcement mechanisms because judgment debtors may refuse voluntary payment. Here, however, non-payment formed part of a wider evidential picture suggesting an economically irrational attempt to delay or defeat enforcement.
4. The court may take account of enforcement practicalities. Readily transferable cash, watches, coins and artwork could present a real dissipation risk even though other assets, including a family home, might ultimately support enforcement. The existence of assets elsewhere did not answer the risk where enforcement would be delayed, costly and potentially disproportionate.
5. The purpose of post-judgment freezing relief is preservation of assets against which enforcement may be levied, not pressure to pay. No improper purpose was inferred. A notification injunction of the kind recognised in Holyoake v Candy [2018] Ch 297 was unsuitable on these facts.
6. The court required 14 days’ notice of withdrawals which would reduce the defendant’s share of specified bank and investment accounts below £673,500, reduced the English and Welsh financial-asset notification threshold to £1,000, refused further information about alleged joint ownership, fixed the affidavit deadline at 4 pm on 31 January 2020, continued the cross-undertaking in damages, released the claimant from fortification, fixed living expenses at €2,000 per week, and summarily assessed costs at £40,000 and £43,000.

The judgment describes earlier same-litigation decisions: judgment was entered by Mr Justice Teare on 23 November 2018, and the defendant’s application to set it aside was refused in [2019] EWHC 3142 (Comm). No appeal was brought. The present decision concerned the return date of the freezing order.