Introduction To The Mareva Injunction Order

• Published date: 22 November 2022
• Subject Matter: Litigation, Mediation & Arbitration, Trials & Appeals & Compensation
• Law Firm: Kevin Wu & Associates
• Author: Mr Kevin Wu and Zarul Farrid

The Mareva Injunction originated from Lord Denning's statutory interpretation in Mareva Compania Naveria SA v. International Bulkcarriers SA [1980] 1 All ER 213. The Mareva Injunction is a court order which restrains the parties being sued (Defendants) to dissipate or dispose of their assets pending determination or disposal of a legal action brought by the parties suing (Plaintiff). In other words, the purpose of Mareva Injunction Order is to freeze the assets of the Defendant to protect the applicant's interest prior to trial.

In Malaysia, Mareva Injunction Order are governed under Order 29, Rule 1 of the Rules of Court 2012 ("ROC"). The Order enunciated certain requirements or prerequisites that the applicant must comply with before an order for the Mareva Injunction can be granted. Further, the application of Mareva Injunction Order may be made by a notice of application supported by an affidavit and where the case is one of urgency, may be made ex-parte (meaning one party to ask for the Court for an order without providing the other party(ies) the usual amount of notice or opportunity to write an opposition.

In order to succeed in a Mareva application, an Applicant must fulfill three (3) requirements which has been highlighted in the case of Creative Furnishing Sdn Bhd v Wong Koi [1989] 1 CLJ Rep 22 where the court held as follows:-

"In Aspatra Sdn. Bhd. & 21 Ors. v. Bank Bumiputra Malaysia Berhad & Anor.[1987] CLJ 50 (Rep) this Court by a majority had referred to the importance of the relief by way of Mareva Injunction for the purpose of preserving assets and preventing a defendant from dissipating his assets within jurisdiction before judgment. But the remedy is not of unlimited application. On the facts of the appeal before us, the respondent must satisfy the Court ... firstly, that he had a good arguable case; secondly, that the appellant had assets within jurisdiction, and thirdly, that there was a real risk of the assets being dissipated or removed before judgment in that there must be solid evidence to establish the risk."

The 3 Elements to grant a Mareva Injunction Order:

1. Good Arguable Case

A good arguable case in the context of a Mareva Injunction is one which is more than barely capable of serious argument, but not necessarily one which the judge considers would have a better chance of success. A good arguable case does not connote a case which is winning but as long as the plaintiff are able:

(i) to present a claim in a coherent and...