Spyridoula-Maria Armeniakou v James Alexander Scott Thomson

The court may make an asset disclosure order extending beyond the territorial scope of an existing freezing order where the information is needed to police that order, identify assets, assess dissipation risk or consider further freezing relief. The order may be justified even though worldwide freezing relief has not yet been granted, provided the statutory and procedural requirements are met and the order is just and convenient.

Confidentiality arrangements may be discharged where parallel proceedings create a substantial risk of inconsistent asset disclosures and impede the claimant’s ability to identify discrepancies. Fortification of a cross-undertaking in damages is discretionary and follows where there is a good arguable case of loss, causation and a sufficient risk that compensation will not be paid.

The claimant obtained an interim freezing order and worldwide asset disclosure order at a without-notice hearing before HHJ Pelling KC. The freezing order was continued at the return hearing, but the question of its worldwide scope and the continuing form of the asset disclosure order were left for further determination.

The respondent subsequently sought to restrict disclosure to assets in England and Wales and to maintain a confidentiality club. The court also had to determine fortification of the claimant’s cross-undertaking in damages and costs arising from the variation application and return hearing.

1. Asset disclosure order. The worldwide asset disclosure order was continued. The court had power to make an order necessary to ensure that the freezing order was effective. This included disclosure concerning assets outside England and Wales, both to police the existing order and to assess whether further freezing relief should be sought. JSC Mezhdunarodniy v Pugachev established that credible material supporting a possible application for further freezing relief could suffice; it was unnecessary to show that such relief would ultimately be granted.
2. CPR Rule 25.1(1)(g) was satisfied because the respondent’s assets were or might be the subject of a freezing injunction application. The absence of a worldwide freezing order did not create an inflexible mismatch between the disclosure order and the freezing order. The international nature and opacity of the business, together with concerns about inaccurate disclosure and dissipation, made the order just and convenient. It was not inexpedient on comity grounds.
3. Confidentiality. The confidentiality club was discontinued. The respondent’s asset position was also in issue in Greek proceedings, creating overlap between the information disclosed in the two proceedings. Maintaining the club would impede the claimant and her lawyers from identifying inconsistencies. The claimant’s collateral-use undertaking, her United Kingdom bank account and additional fortification provided sufficient protection.
4. Fortification. Applying the principles in Alta Trading UK Ltd v Bosworth, additional fortification was appropriate. The respondent had shown a good arguable case of loss through the inability to invest frozen funds, causation by the freezing order and a sufficient risk concerning recovery. On a broad estimate allowing for expenditure and depletion of funds, a further £325,000 was ordered.
5. The respondent was ordered to pay 100% of the variation application costs and 90% of the return-date costs. The latter reduction reflected the cumulative effect of shortcomings in the claimant’s conduct, although the court rejected the suggestion of a general pattern of non-compliance.

First-instance decision determining consequential issues arising from the continuation of an interim freezing order and asset disclosure order.