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November 30, 2015

Freezing Orders in Jersey in Post-Judgment Proceedings

Authored by Eric (Rick) Rein

 in International Asset Recovery

In a recent unreported decision,ENRC NV v. Zamin Ferrous Limited(2015) JRC 217, the Jersey Royal Court demonstrated its consent to ensuring that judgment creditors can enforce their judgments worldwide. In this case, the judgment creditor applied for an ex-parte order to freeze assets and to compel the judgment debtor to answer questions about its assets and assets held by its subsidiaries. The answers revealed two agreements had been entered into pursuant to which certain assets held by subsidiaries had been transferred to third parties.

 

The Royal Court reasoned it had "wide discretion" to order further disclosure about the agreements for the purpose of policing the freezing order and to ensure "that the judgment creditor has all the information he needs to execute the judgment anywhere in the world." The key principle to the court was that in post-judgment proceedings, once a judgment is entered, the Court has free-standing jurisdiction, independent of the freezing order jurisdiction, to order disclosure in aid of the enforcement. As to the scope of the order requiring disclosure of assets of the subsidiaries, the Court decided that "it must be information as to assets within a corporate structure beneath a judgment debtor that a judgment creditor needs in order to execute the judgment anywhere in the world."

 

Thus, the Jersey Royal Court took a pragmatic approach to ensuring freezing orders are effectively policed and assisting foreign courts in the enforcement of judgments by ordering judgment debtors within its jurisdiction to make disclosure of their worldwide assets. 

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