Palesa SARL & Ors v Bochicchio & Anor

To obtain a worldwide freezing order, an applicant must establish a good arguable case, assets within or outside the jurisdiction, a real and objectively assessed risk of unjustified dissipation, and that the order is just and convenient.

Dishonesty allegations alone do not invariably establish a real risk of dissipation. However, the nature of the alleged fraud, evasive responses to redemption requests, non-payment of settlement sums, and promises not to dispose of assets may together provide compelling evidence of such a risk. The possibility that assets have already been moved does not make relief inappropriate where freezing remaining assets or tracing them may still assist enforcement.

The claimants sought an urgent worldwide freezing order and ancillary relief against the defendants following alleged investment fraud and unpaid settlement obligations. The settlement deeds required payment of approximately €33.1 million, payment of proceeds from specified shares, and disclosure and payment of investment returns.

The defendants had been given three clear days’ notice but neither responded nor appeared. The court therefore considered whether the claimants had established a good arguable case, a real risk of dissipation, and that relief was just and convenient, as well as whether there was a sufficient jurisdictional connection.

1. Disposition. The worldwide freezing order sought was granted in principle.
2. The settlement deeds gave the claimants a very strong claim for unpaid sums. There was also a good arguable case concerning the unpaid proceeds of the BABA shares and the defendants’ obligation to account for interest or gains. The defendants’ own email could fairly be used, for present purposes, to quantify the returns claim.
3. The risk of dissipation had to be assessed objectively. Reliance on a good arguable case of dishonesty would not, by itself, always establish that risk. Here, however, the alleged dishonest representations concerning HSBC’s connection with Kidman, the questionable authenticity of an HSBC document, evasive and inconsistent responses to redemption requests, and continuing non-payment supported a real risk that assets would be dissipated or made more difficult to recover.
4. It remained just and convenient to grant relief even though some assets might already have been transferred. The prospect of freezing assets still held, or obtaining information enabling their pursuit, justified the order. The defendants’ contractual promise not to dispose of or deal with assets outside the ordinary course of business strongly supported proportionality and made it more difficult to characterise the injunction as unjustified.
5. Jurisdiction was established by the exclusive jurisdiction and service provisions in the settlement deeds, together with evidence of assets in England and abroad, including a London flat, English shareholdings and Kidman’s English bank accounts.

First-instance application for a worldwide freezing order. No appellate history was stated in the judgment.