Michael John Harvey v Santander UK PLC

An interim mandatory injunction compelling a bank to permit withdrawals from a frozen account is a discretionary remedy requiring a high degree of assurance that the claimant will succeed at trial. The court must consider whether damages would adequately compensate the bank if the injunction were wrongly granted and where the balance of convenience lies. The status quo will generally be maintained where the bank may face regulatory, criminal or third-party liability if funds are released. A claimant’s delay does not necessarily defeat urgency, particularly where the bank contributed to the delay or failed to explain its contractual position. A claim involving substantial factual disputes and contractual construction is unsuitable for CPR Part 8 and should proceed under CPR Part 7.

The claimant sought an interim mandatory injunction requiring Santander UK PLC to unfreeze his business bank account and permit him to manage and transfer funds held in it. The account had been frozen after substantial payments were received from Dubai and Indonesia. The bank suspected fraud, criminal activity and misuse of the account, and relied on contractual terms permitting it to refuse payments, suspend or close the account.

The claimant said the funds related to legitimate property transactions for clients. He had not provided documentary evidence substantiating the source and legitimacy of the payments. The application was made under CPR Part 8. The central issues were whether the bank had a contractual right to restrict the account, whether interim mandatory relief was appropriate, and whether the claim was procedurally suitable for Part 8.

1. Application refused. The claimant failed to establish the high degree of assurance required before an interim mandatory injunction could be granted. The court was not satisfied that he would establish at trial that Santander lacked contractual rights under its 2022 General Terms and Conditions to freeze or close the account and refuse to execute his instructions.
2. There was a serious issue to be tried concerning the bank’s contractual rights. The claimant’s explanations did not adequately establish the legitimacy of the funds, and he had provided no documentary support to the bank or the court. The bank would also have to establish at trial whether the later contractual revisions had been agreed and whether they could operate retrospectively.
3. Damages would be inadequate for the bank if the injunction were wrongly granted. Release or redirection of the funds could expose it to regulatory or criminal sanctions and claims by persons asserting beneficial ownership. The claimant’s limited means meant that his cross-undertaking in damages would provide no meaningful protection. Conversely, the bank could compensate the claimant if he succeeded.
4. The balance of convenience favoured maintaining the status quo. The court rejected the bank’s submission that delay alone defeated urgency, since the bank had materially contributed to the delay and had not previously explained its reliance on contractual terms.
5. The claim involved contractual construction and substantial factual issues and was unsuitable for CPR Part 8. It was to be re-allocated to CPR Part 7. The defendant was awarded summarily assessed costs of £15,884.10, payable within 28 days.