Freezing Injunctions And Enforcement

A recent unreported decision (ENRC NV v Zamin Ferrous Limited [2015] JRC 217) has demonstrated the Jersey Royal Court's willingness to make disclosure orders not only to police post-judgment freezing orders but also to ensure that judgment creditors have all the information they need to enforce their judgments worldwide.

Background

In ongoing litigation in the English Commercial Court, ENRC NV ("ENRC") obtained summary judgment against Zamin Ferrous Limited ("Zamin", a Jersey company) on a counterclaim in June 2015 in the amount of US$65 million plus interest. ENRC then applied to the Royal Court of Jersey ex parte for an order freezing Zamin's assets and requiring Zamin to answer a number of questions about its assets and assets held by its subsidiaries. Zamin provided answers to those questions which revealed that two agreements had been entered into pursuant to which certain assets held by its subsidiaries were to be transferred to third parties.

This, combined with existing concerns about Zamin's conduct, cast doubts upon the effectiveness of the freezing order and ENRC's ability to enforce its judgment. Consequently, by an inter partes application, ENRC sought disclosure of the agreements, and related information. Zamin opposed the application on a number of grounds, including the following:

Zamin had applied for permission to appeal the summary judgment order and for a stay of execution pending determination of the appeal; the value of its ongoing claim against ENRC, due to be tried in February 2016, was significantly higher than the value of ENRC's judgment against Zamin...