Motorola Solutions, Inc. & Ors v Hytera Communications Corporation Ltd & Ors

A freezing order requires solid evidence of a current real risk that assets will be unjustifiably dissipated so as to frustrate enforcement. At an interlocutory stage, disputed evidence of threats made in without-prejudice discussions may be admitted where there is a plausible evidential basis and, if true, the conduct would constitute unambiguous impropriety. A threat to move assets beyond the reach of a judgment falls outside without-prejudice privilege. Serious wrongdoing may support the risk of dissipation, but wrongdoing alone does not necessarily justify that inference. Chabra relief is available where there is good reason to suppose that a third party’s assets would be amenable to execution against the judgment debtor. Worldwide disclosure requires a sufficient connecting link with England and Wales.

Motorola sought post-judgment relief in England after obtaining a substantial judgment in US proceedings against three Hytera companies. It applied for a domestic freezing order and asset disclosure against Hytera China and related English companies, including Shortway and Sepura, which were not parties to the US proceedings.

The application relied on alleged threats, made during without-prejudice settlement meetings, to move assets into jurisdictions where enforcement would be difficult. The issues were whether the evidence was admissible under the unambiguous-impropriety exception, whether there was a real risk of dissipation, whether Chabra relief was available against Shortway, and whether worldwide disclosure should be ordered.

1. Freezing order and admissibility. The court applied the principles summarised in National Bank Trust v Yurov [2016] EWHC 1913 (Comm): the applicant must show a current real risk that a judgment will not be satisfied because of unjustified dealing with assets, supported by solid evidence. The alleged statements by Hytera’s senior officers had a plausible evidential basis. The court therefore followed Dora v Simper and considered whether the statements, if made, would amount to unambiguous impropriety, rather than resolving the factual dispute at the interlocutory stage.
2. The alleged proposal to move assets to frustrate enforcement was materially equivalent to the threat considered in Dora v Simper. Such conduct, if threatened by improper means, falls outside without-prejudice privilege. The exception does not require a heightened standard of proof. The court distinguished the factual context of Savings & Investment Bank v Fincken and Berry Trade v Moussavi.
3. The statements were sufficient to establish a real risk of dissipation. The risk was strengthened by serious proven wrongdoing in the US proceedings and the good arguable case that Hytera’s senior management had been complicit. The company’s size, reputation, delay, notice of the application, absence of identified asset movements and possible enforcement in China did not outweigh the evidence.
4. Chabra jurisdiction. Applying PJSC Vseukrainskyi Aksionernyi Bank v Maksimov [2013] EWHC 422 (Comm), as quoted with apparent approval in Lakatamia Shipping Co v Nobu Su [2014] EWCA Civ 636, the jurisdiction is not confined to nominee or trustee cases. The question is whether there is good reason to suppose that the third party’s assets would be amenable to execution against the cause-of-action defendant.
5. Disclosure. Although disclosure may in principle extend beyond a freezing order, the court refused a worldwide order against the overseas Hytera companies. There was no sufficient connecting link, and discovery was available in the US proceedings. Disclosure in relation to Shortway was provisionally appropriate because it was an English company and was needed to make the injunction effective.