E & Ors v M

The present hearing concerns an application by the Second Claimant (“the Claimant”) and a cross application by the Defendant relating to a Worldwide Freezing Order granted by Gloster J on 9 March 2012 and renewed on 30 March 2012 (“the WFO”).

A number of further orders have been made arising from the WFO. In particular on 26 October 2012 I held that the Defendant was in deliberate and contumacious contempt of the WFO in failing to file an affidavit of assets and that this contempt had been actively procured and instigated by its Chief Executive, Mr X. Pursuant to the orders I made in the autumn of 2012, permission was granted to issue a writ of sequestration against the real and personal property of both the Defendant and Mr X. Mr X was committed to prison for 18 months and a warrant for his arrest has been issued. The writs of sequestration have not yet been issued.

The Defendant has finally now provided an affidavit of assets. This was sworn on 14 March 2013 and served on the Claimant’s solicitors the following day.

The affidavit was followed by further correspondence between the parties’ solicitors relating to the adequacy of the affidavit provided.

The main applications made by the Claimant which are to be dealt with at the present hearing are for:

The main applications made by the Defendant which are to be determined at the present hearing are for:

There are further applications which may arise depending on the resolution of these main issues.

By a charter party dated 20 May 2008 on an amended NYPE form (“the charter party”), the Claimant let a vessel (“the vessel”) to the Defendant. During the course of the charterparty, the Defendant did not pay hire in the amounts required or at the times required.

This led to arbitration being commenced. The arbitration was begun in mid-2011. In August and November 2011 the Claimant obtained two interim partial awards for unpaid hire.

On about 30 December 2011 the vessel was dry-docked by the Claimant. Following dry-docking, the Defendant insisted that the vessel must perform a full sea trial so as to address the Defendant’s concerns about her performance. The Claimant said that the Defendant could not insist on such a trial. During this period, the Claimant asserted a right to hire and the Defendant denied that it was obliged to pay.

On 4 March 2012, the Claimant terminated the charterparty prematurely relying on clauses 5 and 46 of the charterparty and asserting that the Defendant was in repudiatory breach of the charterparty. This alleged breach founds the lion’s share of the claim for damages in support of which the WFO was granted on 9/30 March 2012.

I propose to address the Issues under the following headings:

Whether the Defendant has purged its contempt

The affidavit of assets was served on 15 March 2013.

By a letter dated 19 March 2013 the Claimant asserted that the affidavit was incomplete and incorrect and raised six queries. By a letter dated 8 April 2013 the Defendant’s solicitors provided answers to these questions.

Subject to two points it is not now disputed that a satisfactory affidavit of assets has been provided. The first point made is that no accounts have been supplied. However, I accept that in this case accounts are not required as part of the affidavit of assets. That affidavit is required to identify the assets, not to provide evidence relating to them. The assets have been identified. Further, the Defendant states that it, as a no-ship Panamanian company, has no accounts, as has been confirmed by a witness statement from Mr X. This leads on to the second point which is that it is contended by the Claimant that that should be confirmed by affidavit. Since I have found that there is no obligation to provide accounts there can be no requirement to verify the non-existence of such accounts by affidavit. In any event, in all the circumstances, and bearing in mind the nature of the Defendant company, I would have accepted that a witness statement was sufficient.

On the face of it the Defendant has therefore finally purged its contempt by providing the long overdue affidavit of assets. However, the Claimant took a further point that for the contempt to be purged the Defendant not only had to provide that affidavit but also had to apologise to the court in a satisfactory manner. It was contended that the apology contained in Mr X’s affidavit was insufficient because there was no adequate explanation of why the Court’s order had not been complied with. However, there is an apology and that apology is not conditional or limited as was the case, for example, in the case of Lambeth LBC v Pead (unreported) which was relied upon by the Claimant. In my judgment the apology given is sufficient to enable the Defendant’s contempt to be purged and it is entitled to the declaration sought by it.

It follows that the Claimant’s application, made on the basis that the contempt had yet to be purged, that there should be an order debarring the Defendant from defending the arbitration does not arise. There were serious issues raised as to the Court’s jurisdiction to make any such order and, if so, the appropriateness of doing so, but it is not necessary to resolve such issues.

For completeness I should add that the Claimant suggested that if I held that the contempt had been purged I should consider fining the Defendant for its past contempt. Previously it had been the Claimant’s case that a fine would serve little purpose and the appropriate sanction against the Defendant was permission to issue a writ of sequestration, which I gave. In all the circumstances, which include the fact that the individual responsible for the contempt has been sentenced to imprisonment, I do not consider that a fine should be imposed.

Whether the WFO should be discharged

The Defendant contended that it should be discharged for either or both of the following reasons:

As to (1), the Defendant stressed that a claimant who obtains a freezing injunction is under an obligation to proceed with the underlying claim as quickly as he can, as set out in the White Book at §25.1.25.11:

“A freezing injunction is an adjunct to a claim and not a substitute for the relief to be obtained at the trial. Therefore a claimant applying for and granted such injunction should press on quickly with their action. It as an abuse of process for a litigant to obtain a freezing injunction and then not to prosecute the action; a litigant is under a duty either to proceed with their claim or to apply, on their own motion, to have the injunction discharged (Town and Country Building Society v Daisystar Ltd 139 N.L.J. 1563 (1989). Failure to progress the action, wherever it is taking place, is a ground upon which a court may discharge an injunction previously granted.”

In the present case the Defendant submitted that there had been serious and inexcusable delay by the Claimant in prosecuting the claims which were the subject matter of the WFO made in March 2012. Over a year later there has still not been service of submissions advancing the claims which the Claimant stated to the Court in March 2012 that it intended to prosecute.

The Claimant accepted that an applicant for a freezing order would normally be expected to bring forward its claims with reasonable expedition, although it observed that the Court did not require the Claimant to give any undertaking to this effect.

It pointed out, by reference to Dr Panagopoulos’s 12^th affidavit, that between 1 February 2012 and 4 April 2012 there were without prejudice discussions between the parties.

Thereafter the Claimant submitted that the delay in serving Submissions was explicable and excusable. It was bound up with the issue of whether the Claimant was to be allowed to proceed with its application for a third partial award without being required to incorporate its further claims.

In summary, on 9 April 2012 the Claimant applied to the Tribunal for an Interim Award on an expedited basis. This provoked an application by the Defendant to the Tribunal on 17 April 2012, in which the Defendant argued that the Tribunal should not proceed to consider the claim and that the Claimant should instead serve fresh compendious claim Submissions incorporating their claims for further hire and damages following the withdrawal. The Defendant argued that the Claimant’s claims had all crystallised following the withdrawal and were already expressly particularised in the application for a freezing injunction obtained on 9 March 2012.

The Claimant responded to the Defendant’s application, stating that the hire claimed in the Third Claim Submissions was indisputably due and that the Defendant’s suggestion to serve fresh and final Claim Submissions would be wholly contrary to the intention and purpose of the application for an expedited Interim Award.

Following further exchanges between the parties in the same vein the Tribunal stated on 9 May 2012 that it would review the position and revert and requested that meanwhile there be no further comments from the parties. In the circumstances, the Claimant decided to wait until the Tribunal had delivered its ruling before embarking on preparation of further claim Submissions.

By July 2012, the parties still had not heard from the Tribunal and chasers were sent by both parties’ solicitors.

On 8 November 2012, the Tribunal finally gave directions as to how the parties should proceed as follows:

“… We note the Charterers’ request that we direct the Owners to serve new Claim Submissions dealing with all matters in dispute following the termination of the charter party. Although the tribunal can see at least some superficial attraction in this proposal the fact is that the Owners might do so but still maintain their request for an interim award for the undisputed balance claimed. In the circumstances we consider that the Charterers should respond substantively to the application and advance their case as to why we should not make an award in the terms requested. Bearing in mind the vintage of the application it seems reasonable that we require this response to be served by no later than 19^th November 2012.”

The following day, the Tribunal was informed by Ince & Co that they were no longer retained by the Defendant in the arbitration. The Tribunal thereupon re-sent their directions directly to a representative or employee of the Defendant drawing attention to the deadline of 19 November 2012 for a response to the Claimant’s application for an Interim Award.

At that stage the Claimant anticipated that the Tribunal’s award would be issued within a very short timescale and accordingly continued to defer preparation of the further claim Submissions until after it had been issued. Unfortunately, there was then further delay consequent upon the Defendant’s change of lawyers and the Tribunal only finally handed down its Award on 14 February 2013.

It accordingly took a considerable time for the Tribunal to decide that it would allow the Claimant to pursue its application for a third partial award and then to produce its award. The Claimant Submitted that it was sensible to await the outcome of that application before moving to the next stage; that the nature and quantum of the remaining claims depended on what the Tribunal determined in its award; that the Submissions are now almost finalised and that the detail of the claim and the evidence relied upon has always been apparent from the evidence set out in Dr Panagopoulos’s 5^th affidavit in March 2012.

The Defendant submitted that neither it nor the Tribunal can be held responsible for the failure to advance its claims with the required promptness. There was nothing to prevent it doing so and it should have done so long ago.

I accept that in the ordinary case that where a claimant obtains an injunction relating to a claim in respect of which proceedings have yet to be issued it should issue proceedings making its claim in relatively short order. In the present case there were arbitration proceedings already afoot into which the claims in question were to be brought. At an early stage the question of how those claims were to brought in became bound up with the Claimant’s application for a third partial award which it was understandably concerned should not be prejudiced. By July 2012 the Tribunal was itself stating that it wished to hear no further from the parties and would determine how matters would proceed. Unfortunately it took the Tribunal until November 2012 so to decide and then a further 3 months to produce its third award.

Whilst one can understand why the Claimant did not produce revised claim Submissions pending the Tribunal’s determination as to how the claims should proceed and the production of its award, I consider that it should have done so in order to formalise the position in relation to the claims in respect of which the WFO had been obtained.

Criticism can therefore be made of the Claimant’s conduct in this regard although there is force in the Claimant’s point that it lies somewhat ill in the Defendant’s mouth to complain of delay in advancing the arbitration when it has itself resorted to every tactic available to delay or impede the Claimant’s various applications for expedited interim awards of hire and to progress the arbitration generally. No complaint about failure to serve the further claim Submissions has been made until very recently, other than tactically as part of the Defendant’s attempts to put off the application for a third partial award. Further, had claim Submissions been provided it is unlikely that the arbitration would be materially further advanced than it presently is. Whilst I consider that the Claimant should have provided its Submissions more speedily, in all the circumstances I do not regard that as a sufficient reason in this case for discharging the WFO.

As to (2), the Defendant Submitted that the steps taken by the Claimant in arresting MV “XYZ” in another jurisdiction (to which I will refer as “Ruritania”) in May 2012 were a breach of its undertaking given to the Court in the WFO. The Defendant requested the Court to declare that the Claimant is in contempt of court and require it (at least) to purge that contempt by releasing the vessel from arrest.

The WFO contains an undertaking from the Claimant (in the usual form) that it would not “without the permission of the court seek to enforce this order in any country outside England and Wales or seek an order of a similar nature including orders conferring a charge or other security against the Respondent or the Respondent’s assets.”

On 4 May 2012, the Claimant applied to the High Court of Ruritania (ex parte) for the arrest of MV “XYZ”, a vessel owned by XYZ Corporation, for the purpose of obtaining security in the underlying arbitration proceedings. Provision of security of US$15,728,353.06 was required to secure her release.

The Claimant did not apply to this Court for permission to make this application. The security sought in Ruritania has not been provided and the vessel has remained under arrest at a Ruritanian port for the last 11 months.

In relation to the law, the Defendant Submitted that an undertaking given to the Court as a condition for the granting of an order binds a party in the same way as an injunction would: Grupo Torras v Al-Sabah (No.7) [2001] EWCA Civ 1370 at [24]. Failure to comply with such an undertaking is thus a contempt of court in just the same way as a breach of an injunction. It follows that a claimant’s breach of an undertaking should be taken into consideration by a court when assessing whether an injunction should be continued and, “in an appropriate case, breach of an undertaking may result in discharge of the injunction”: White Book at §15-28 (citing Sabani v Economakis, 17 June 1988).

The Defendant relied by analogy on Dadourian Group International v Simms [2006] EWCA Civ 399; [2006] 1 WLR 2499 at [2] per Arden LJ in which the Court of Appeal gave guidance as to the matters to be taken into account when a claimant seeks to enforce a WFO abroad. The guidelines set out in that case (“the Dadourian guidelines”) were as follows:

“Guideline 1 . The principle applying to the grant of permission to enforce a WFO abroad is that the grant of that permission should be just and convenient for the purpose of ensuring the effectiveness of the WFO, and in addition that it is not oppressive to the parties to the English proceedings or to third parties who may be joined to the foreign proceedings.

Guideline 2 . All the relevant circumstances and options need to be considered. In particular consideration should be given to granting relief on terms, for example terms as to the extension to third parties of the undertaking to compensate for costs incurred as a result of the WFO and as to the type of proceedings that may be commenced abroad. Consideration should also be given to the proportionality of the steps proposed to be taken abroad, and in addition to the form of any order.

Guideline 3 . The interests of the applicant should be balanced against the interests of the other parties to the proceedings and any new party likely to be joined to the foreign proceedings.

Guideline 4 . Permission should not normally be given in terms that would enable the applicant to obtain relief in the foreign proceedings which is superior to the relief given by the WFO.

Guideline 5 . The evidence in support of the application for permission should contain all the information (so far as it can reasonably be obtained in the time available) necessary to make the judge to reach an informed decision, including evidence as to the applicable law and practice in the foreign court, evidence as to the nature of the proposed proceedings to be commenced and evidence as to the assets believed to be located in the jurisdiction of the foreign court and the names of the parties by whom Such assets are held.

Guideline 6 . The standard of proof as to the existence of assets that are both within the WFO and within the jurisdiction of the foreign court is a real prospect, that is the applicant must show that there is a real prospect that such assets are located within the jurisdiction of the foreign court in question.

Guideline 7 . There must be evidence of a risk of dissipation of the assets in question.

Guideline 8 . Normally the application should be made on notice to the respondent, but in cases of urgency, where it is just to do so, the permission may be given without notice to the party against whom relief will be sought in the foreign proceedings but that party should have the earliest practicable opportunity of having the matter reconsidered by the court at a hearing of which he is given notice. “

In relation to the facts, the Defendant pointed out that the arrest of the vessel was obtained for the express purpose of “providing security for a claim that the applicant will advance in London arbitration proceedings against M”. It submitted that its purpose was the same as that of the WFO itself: to seek to ensure that there would be assets against which an arbitral award could be enforced. The Claimant accordingly did precisely what it submitted the undertaking was designed to prevent, namely, subjecting the Defendant (and a third party) to a separate strand of proceedings in another jurisdiction which effectively duplicated the English proceedings.

The Defendant further Submitted that had the Claimant sought this Court’s permission before seeking any supporting relief from the Ruritanian courts, this Court would have rejected the application in the light of the Dadourian guidelines for the following reasons in particular:

Alternatively, even if the Court would not have refused permission on Such an application, it would have: either (i) imposed a restriction on the relief which it permitted the Claimant to seek in Ruritania; or (ii) reduced the protection afforded to the Claimant under the Injunction to reflect the protection obtained by means of the arrest of the “XYZ” in Ruritania. It is highly unlikely that the Court would have allowed both the WFO (covering an amount of US$16m) and the order for arrest (requiring security of over US$15.7m) to be in place simultaneously.

The Claimant disputed that there had been any breach of the undertaking. It said that it considered the matter at the time and took the view that the arrest would not breach the undertaking as an arrest is not “similar” to a freezing order, in the sense that it does not purport to charge or freeze the Defendant’s assets generally. A WFO is not intended to restrict a claimant’s free-standing right to seek to secure its claim against a specific asset in a specific jurisdiction. It submitted that it is commonplace for a creditor to seek to protect its position by means other than a WFO, Such as by arrest. It is and should be permitted to do so without the need to come to court first, particularly as there is often a need to act with urgency in the foreign jurisdiction. What cannot be done without the permission of the Court is to seek to enforce a WFO abroad or to obtain a similar general attachment or freezing order abroad, thereby adding to the burden of the English court order or duplicating the relief thereby conferred.

Whilst the Claimant acknowledged that an arrest can be regarded as involving the obtaining of security “against the Respondent” it Submitted that the governing words are “an order of similar nature”. It is only a charge or security which is “of a similar nature” to a WFO that requires permission. Unless the order is “of a similar nature” you never get on to the clarificatory words, "including orders conferring a charge or other security..". That merely makes it clear that if the order is otherwise a similar order to a freezing order it does not matter that it creates a charge or other security.

Neither side could provide any authority that bears directly on this point, which is of some practical importance.

The origin of this undertaking lies in the case of Derby& Co Ltd v Weldon [1990] Ch 48. In that case Nicholls LJ held as follows at p 59:

“In the present case the plaintiffs propose that this point should be dealt with by the plaintiffs giving to the English court an undertaking in terms which will preclude them from making any application to a foreign court to enforce the order without first obtaining leave from the English court. This seems to me to be a convenient course. If this undertaking is accepted, and an order is made, it would then be for the judge of the English court to whom any application for Such leave might be made to consider, amongst other matters, whether the enforcement of the order in the country or countries for which leave is sought will, under the law of that country, result in the order having a substantially similar effect there to a Mareva restraint order in this country, as distinct from the order having there a more far-reaching effect (Such as the assets in the country being attached as a form of security for the plaintiffs' claims, which is not the object of a Mareva restraint order). On any application for Such leave, which normally would be inter partes, the judge can be expected to have before him what we do not have, namely, evidence of the law and practice in the country or countries in which the order is sought to be enforced. The undertaking, I add, is being offered by all the plaintiffs, which include amongst their number English companies whose substance has not been questioned. So the undertaking is a worthwhile one.”

The focus of concern there expressed is that leave to enforce a WFO abroad should not be given if it is to have a more far reaching effect than the order made here and that information pertaining to that issue should be provided to the Court. That is understandable in the context of an application for leave to enforce a WFO. The English court would not want its order to be used to wider and different effect than it considers appropriate in making such orders. Those concerns do not, however, arise where what is sought to be done is to obtain an order abroad of a different nature. Whilst the foreign court may well wish to have regard to the fact that there is a WFO in deciding whether to make its own order, whether or not it is appropriate for it to exercise its own independent jurisdiction to make such an order is a matter for it rather than the English court. That jurisdiction does not depend upon or derive from the making by the English court of the WFO.

Similarly, if one considers the Dadourian guidelines one can see that they are essentially directed at enforcement abroad of the English court WFO. Thus Guideline 1 states the governing principle to be what is just and convenient “for the purpose of ensuring the effectiveness of the WFO”. Obtaining a specific form of security order abroad Such as an arrest has nothing to do with “ensuring the effectiveness of the WFO”.

Similarly, Guidelines 4 and 7 are clearly premised on the fact that the foundation of the relief for which permission is sought is the English WFO, not some independent and different right. Guideline 5 goes to the issue of ensuring that leave to enforce will mean that the order abroad will have a substantially similar effect to the WFO.

The fact that many of the Dadourian guidelines are inapt to the pursuit of an independent right to security abroad lends some support to the Claimant’s case that the permission requirement is focused on the seeking of permission to enforce a WFO abroad or obtaining similar relief abroad. The main concern underlying the undertaking is an inappropriate or oppressive extension of the WFO through its enforcement abroad or its duplication. It is not directed at precluding the pursuit of different and independent rights to security that may be available abroad.

For the reasons outlined above, and those given by the Claimant, I conclude that the arrest of the MV “XYZ” did not involve a breach of the undertaking because it did not involve seeking “an order of a similar nature” to the WFO.

As to the issue of overlap between the orders obtained, if the foreign court order resulted in security for the claim being obtained the claimant would, pursuant to its ongoing obligation of disclosure, be obliged to bring that to the attention of the Court because it would be relevant to the amount covered by the WFO.

If, contrary to the above, there was a breach of the undertaking the Claimant apologised whole-heartedly and stressed that it had no intention to breach its undertaking and did not believe that it had. It also pointed out that the fact of the arrest was referred to in the affidavit evidence before the Court and was not in any way held back.

As to what would have happened if the matter had been brought to the attention of the Court, the main difficulty for the Defendant is that since, due to its own contempt of court, there was no affidavit of assets there was no evidence that anything had been caught by the WFO. In Such circumstances I consider that the Court would have been likely to allow the arrest to proceed Subject to being kept informed of any security which was put up and to being informed, so far as it was possible, of the unencumbered value of the arrested vessel. In fact on the evidence before the court it appears that the outstanding mortgage on the vessel is approaching twice its value so that the vessel itself provides no meaningful security.

Other reasons which tell against the discharge of the injunction are:

In all the circumstances, even if I had held the Claimant to have been in breach of its undertaking, I would not have considered the breach either on its own, or when viewed in conjunction with the failure to provide claim Submissions, to require the discharge of the injunction or an order for the release of the arrest. A further reason for not so exercising my discretion is the Defendant’s deliberate and contumacious contempt of court for nearly a year. Although that contempt has now been purged the slate cannot be wiped clean and it is right to observe that, although an apology has been made, no adequate explanation for the contempt has been provided.

Whether the WFO should be varied to include the Securities

The Securities are assets legally and beneficially owned by five companies in the M Group who are incorporated overseas and are not presently before the Court. Two of these five companies are Mr X’s private investment vehicles and all of the companies (save possibly for one “R”) are said to be Subject to his controlling mind and will.

For the purposes of this application the Claimant does not assert that any of these assets are legally or beneficially owned by the Defendant, nor does it seek to pierce the corporate veil.

It asserts, however, that these are assets which the Defendant “has the power, directly or indirectly, to dispose of or deal with as if it were his own” under paragraph 5 of the WFO.

The Claimant contended that these assets are within the effective control of the Defendant because:

The argument therefore is that since the controlling mind and will of the M Group is the Chief Executive of the Defendant, the Defendant has effective control of all assets of companies within the Group.

However, the person who has control is Mr X, not the Defendant. The fact that Mr X may be Chief Executive of the Defendant does not give the Defendant control over him. It might be different if the Defendant could be equated with Mr X, but it cannot, as is recognised by the fact that no attempt is made to pierce the corporate veil.

If the Claimant was right, the assets of any company of which Mr X is the controlling mind and will and all of his personal assets would be caught by the WFO, or indeed a WFO against any of his companies. This would give an extraordinarily wide ranging effect to the WFO and would be tantamount to piercing the corporate veil without laying the grounds for doing so or actually doing so.

No authority has been cited by the Claimant that comes close to supporting the extreme argument put forward by it.

Relevant guidance as to the circumstances in which a freezing order may be obtained against a non cause of action defendant (“NCAD”) is provided in Parbulk II As v PT Humpuss Intermoda Transportasi TBK & Ors (“The Mahakam”) [2012] 2 All ER (Comm) 513 at [35] et seq and Algosaibi v Saad Investments Co Ltd Court of Appeal of the Cayman Islands (15 February 2011, unreported) per Sir John Chadwick P.

Those cases make it clear that it is not legitimate to disregard the separate corporate personality of individual companies in a group (i.e. to pierce the corporate veil) merely because the ultimate, or intermediate, holding company may have the practical ability to require a subsidiary to act in a particular way, or because it is necessary to achieve justice, even in circumstances where one or more of the companies in question may have been involved in some sort of impropriety (The Mahakam [42]). It is not enough that the cause of action Defendant (“CAD”) could, if it chose to, cause the assets held by the NCAD to be used to satisfy any eventual judgment (The Mahakam [58] and Algosaibi at [33]).

In general, the only circumstances where the court may make a freezing order over assets neither legally nor beneficially owned by the CAD is where the court is satisfied that there is good reason to suppose either (i) that the CAD can be compelled (through some process of enforcement) to cause the assets held by the NCAD to be used for that purpose; or (ii) that there is some other process of enforcement by which the claimant can obtain recourse to the assets held by the NCAD (The Mahakam [58] and Algosaibi at [33]). Neither applies here, nor is it so contended.

The mere fact that the Defendant might, in practice, be able to prevail upon another company to use its assets to pay any judgment against it is insufficient to justify freezing the third party company’s assets. In any event, it is Mr X rather than the Defendant who may be able to do so and each of the five companies to which I refer above has confirmed that the Defendant does not exercise any control over them.

The Claimant had a further point in relation to the escrow funds which R has apparently agreed can be used to pay legal fees, including those of the Defendant. However, there is no sufficient evidence that the Defendant has a proprietary interest in or control of those monies. These would appear to monies belonging to R which they are prepared to be allowed to be used for these purposes, but no more than that.

I accordingly reject the Claimant’s application for the requested variation of the WFO.

Whether the counter security should be released

The Claimant seeks the release of the sum of US$50,000 which was lodged with its solicitors, Reed Smith, pursuant to paragraph (2) of Schedule B of the WFO to stand as security for its cross-undertaking in damages.

The main basis of the application was that the likelihood of the Court making any order under the cross-undertaking is negligible for the following reasons:

Fortification was required by the Court from the outset. This is not a case of the Defendant seeking further fortification. Instead the Claimant is seeking release from fortification which it was both required and willing to provide from the outset. The Claimant wishes the injunction to continue. That being so it is difficult to foresee what loss might or might not be caused by its continuance. The fact that no claim for loss has been made to date cannot be determinative as to the future. It is the Defendant’s case that it has a defence to the repudiatory breach claim. The time at which claims for consequent loss would generally fall to be considered lies in the future. It cannot be said that there is no prospect of such claims arising, especially in circumstances where, due in no small part to the Claimant’s culpable failure to serve its claim Submissions, the issues have yet to be defined. In all the circumstances I am not satisfied that there is any good reason for removing the fortification required as a condition of all the freezing orders made to date and decline so to order.

For the reasons outlined above:

The decision on these issues should dispose of the subsidiary applications which were raised. If not, they can be addressed following hand down of this judgment.