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Mareva Jurisdiction in English Law: a Critical

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Mareva Jurisdiction in English Law: a Critical Faculty of Arts and Social Sciences The Law School Lancaster University The Evolution, Utility and Effectiveness of the Mareva Jurisdiction in English Law: A Critical Appraisal Joshua S. A. Sendall LL.B. (Hons) (September 2015) Submitted for the Degree of Master of Laws, LL.M. (By Research) Dedicated to the memory of my Grandparents, Elizabeth and Ron Barr Declaration I confirm that the thesis is my own work; that it has not been submitted in substantially the same form for the award of a higher degree elsewhere; and that all quotations have been distinguished and the sources of identification specifically acknowledged. Abstract The Mareva injunction has been available in England for 40 years. Initially, the Mareva injunction was a contentious form of relief; today it is regarded as an exceptionally effective device in common law jurisdictions across the globe. This body of work critically appraises the development, evolution and effectiveness of the Mareva injunction. It is primarily established that the Mareva injunction is an equitable remedy. A corollary crystallises; in order to gain a fuller understanding of the Mareva injunction it is necessary to contextualise it within the equitable jurisdiction. Traditional doctrinal research methods explicate the development of the equitable jurisdiction drawing attention to certain characteristics, common themes, techniques and principles. Equity becomes the contextual framework upon which the ensuing discourse is rendered. At its heart equity is found to be about remedies; a supplementary system which repairs defects in the law. The Mareva injunction was devised to ring fence amenable assets on a temporary basis; to protect the possibility of an effective remedy. The continuing effectiveness of the Mareva injunction is examined in relation to evolving externalities such as the rise of globalisation inclusive of developing financial infrastructures and improving technologies. The action taken by the courts to overcome the difficulties presented by the abovementioned evolving conditions are evaluated. The range of ancillary and connected orders of the court which have been created or refined in order to ensure that the Mareva injunction remains effective are critically appraised. It is argued that the Mareva injunction can no longer be viewed in isolation; it is part of an evolving matrix of interconnected devices which characterise the modern Mareva jurisdiction. Acknowledgements I extend humble thanks to my Supervisor David Milman who provided me with careful guidance, advice and support. I am forever grateful. Contents Introduction ............................................................................................................................... 1 Chapter One: What is Equity? .................................................................................................... 8 Introduction ........................................................................................................................... 8 Common Themes within Equity ............................................................................................. 9 The value of equity to our legal system ............................................................................... 10 Injunctions: a creature born out of conflict? ....................................................................... 12 The heavenly origins of equity’s jurisdiction ....................................................................... 14 The essence of equity .......................................................................................................... 15 Common Law conflict .......................................................................................................... 16 Parallel jurisdictions ............................................................................................................. 17 The stabilisation of the equitable jurisdiction ..................................................................... 18 The gradual fusion of equity and the law ............................................................................ 19 The Judicature Acts: a fused jurisdiction ............................................................................. 23 The effect of the Judicature Acts upon the availability of injunctions ................................ 24 Conclusion ............................................................................................................................ 26 Chapter Two: The emergence of the Mareva jurisdiction ....................................................... 28 Introduction ......................................................................................................................... 28 What is a Mareva Injunction? .............................................................................................. 29 The traditional position ........................................................................................................ 30 Innovative legal thinking ...................................................................................................... 31 Case law development: the conception of the Mareva injunction ..................................... 32 The Karageorgis Case ....................................................................................................... 33 The Mareva case .............................................................................................................. 35 The first inter parties challenge ....................................................................................... 40 Mareva Jurisdiction for English Residents? ..................................................................... 50 The van Weelde case ....................................................................................................... 51 The Daklouche case ......................................................................................................... 52 Resident or non-resident – when a defendant evades the court the same consequences affect innocent creditors ........................................................................... 54 The consistency of the court’s approach to foreign-based defendants and English- defendants ........................................................................................................................... 56 Legislative intervention: The Statutory mandate to grant relief ......................................... 59 What caused the legislative delay?...................................................................................... 61 Conclusion ............................................................................................................................ 63 Chapter Three: The Modern Mareva Jurisdiction and the Mechanisms which Facilitate the Administration of Justice ................................................................................... 66 Introduction ......................................................................................................................... 66 Understanding the modern Mareva context ....................................................................... 67 Asset Tracing ........................................................................................................................ 69 The modern Freezing injunction .......................................................................................... 73 Mareva injunctions: the fundamental grounds ................................................................... 74 Statutory authority .......................................................................................................... 74 The requirements ............................................................................................................. 75 Important considerations for applicants ......................................................................... 76 Important considerations for respondents ..................................................................... 77 The procedure .................................................................................................................. 78 Foreign Assets and Proceedings .......................................................................................... 79 Disclosure Orders ................................................................................................................. 84 Standard Disclosure ......................................................................................................... 85 Pre-action Disclosure ....................................................................................................... 86 Witness summons ............................................................................................................ 86 Other Ancillary Orders ......................................................................................................... 87 The Norwich Pharmacal Order ......................................................................................... 87 Nostro Accounts ............................................................................................................... 90 The Bankers Trust jurisdiction ......................................................................................... 90 ‘Gagging Orders’ .............................................................................................................. 91 Search orders ..................................................................................................................
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