Fourie v. Le Roux & Ors Rev 1

I have had the advantage of reading in draft the opinion of my noble and learned friend Lord Scott of Foscote. For the reasons he gives I would dismiss the appeal and make the orders which he proposes.

Mareva (or freezing) injunctions were from the beginning, and continue to be, granted for an important but limited purpose: to prevent a defendant dissipating his assets with the intention or effect of frustrating enforcement of a prospective judgment. They are not a proprietary remedy. They are not granted to give a claimant advance security for his claim, although they may have that effect. They are not an end in themselves. They are a supplementary remedy, granted to protect the efficacy of court proceedings, domestic or foreign: see Steven Gee, Commercial Injunctions, 5th ed (2004), pp 77-83.

In recognition of the severe effect which such an injunction may have on a defendant, the procedure for seeking and making Mareva injunctions has over the last three decades become closely regulated. I regard that regulation as beneficial and would not wish to weaken it in any way. The procedure incorporates important safeguards for the defendant. One of those safeguards, by no means the least important, is that the claimant should identify the prospective judgment whose enforcement the defendant is not to be permitted, by dissipating his assets, to frustrate. The claimant cannot of course guarantee that he will recover judgment, nor what the terms of the judgment will be. But he must at least point to proceedings already brought, or proceedings about to be brought, so as to show where and on what basis he expects to recover judgment against the defendant.

On his application to Park J, Mr Fourie failed to do this. It follows that the judge was wrong to make the order he did. It also follows, in my opinion, that Mr Jarvis QC, the deputy judge, was right to discharge it. There had been a clear neglect of the correct procedure, and the court should not absolve the defaulting party from the consequences of its neglect by maintaining the order in force: Siporex Trade SA v Comdel Commodities Ltd [1986] 2 Lloyd's Rep 428, 436. That, I think, is so whether or not the deputy judge foresaw that Mr Fourie might, in the immediate future, re-apply successfully in accordance with the recognised practice.

LORD HOPE OF CRAIGHEAD

My Lords,

I have had the advantage of reading in draft the speech of my noble and learned friend Lord Scott of Foscote. I agree with him, for the reasons that he gives, that the appeal on the main issue should be dismissed. I would however set aside the order for indemnity costs.

On the main issue I also agree with the observations of my noble and learned friends Lord Bingham of Cornhill and Lord Rodger of Earlsferry. The importance of maintaining safeguards against misuse of such injunctions has recently been emphasised by the Court of Session in two cases dealing with the analogous…

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