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CPR counterpart

20.1 Part 20 is the counterpart to CPR Part 25. Part 20 is supported by PD 20A, which in turn is modelled on CPR PD 25A. The only paragraph in CPR PD 25A which is not replicated in FPR PD 20A is para 6, which provides for an example of a freezing injunction, but which permits the example to be modified as appropriate in any particular case. Standard forms of freezing and search orders were however promulgated with the President’s authority by the decision of UL v BK (Freezing Orders: Safeguards: Standard Examples), sub nom L v K (Freezing Orders: Principles and Safeguards) [2013] EWHC 1735 (Fam), [2014] Fam 35.

On 30 November 2017 these orders were included in the November 2017 President’s Practice Guidance whereby he promulgated the compendium of standard financial and enforcement orders for general use. The Guidance explains:

These orders do not have the strict status of forms within Part 4 of the FPR 2010 and their use, although strongly to be encouraged, is not mandatory. Moreover, a standard order may be varied by the court or a party if the variation is required by the circumstances of a particular case. There will be many circumstances when a variation is required and departure from the standard form will not, of course, prevent an order being valid and binding. The standard orders should however represent the starting point, and, I would hope and expect, usually the finishing point, of the drafting exercise.

The freezing order precedent is Order No 3.1 in the compendium; the search order precedent is Order No 3.2. In the light of Akhmedova v Akhmedov (No 5) [2019] EWHC 3140 (Fam), Order No 3.2 has been amended to align it more completely with its civil counterpart contained in CPR PD 25A. See www.judiciary.uk/announcements/message-from-mr-justice-mostyn-order-3-2-search-order/.

Scope

20.2 Rule 20.2 sets out the list of interim remedies which may be ordered by the court. The list in rule 20.2 is plainly an attempt to set out every conceivable form of interim remedy for which a party may wish to apply, although the draftsman of the original CPR scheme, replicated in the FPR, did not rule out an application hitherto unimagined. Thus rule 20.2(3) (CPR rule 25.1(3)) provides that ‘the fact that a particular kind of interim remedy is not listed in paragraph (1) does not affect any power that the court may have to grant that remedy’. The provision was apparently inserted in the CPR to make clear that the list was not intended to cut down the court’s inherent jurisdiction, or to exclude powers granted by statute (e.g. to appoint a receiver under section 37 of the Senior Courts Act 1981). Plainly, the list does not limit the power of the High Court in child-related proceedings to make location, passport or disclosure orders, but these powers are beyond the scope of this work.

20.3 The powers exercisable by different levels of judge within the Family Court to grant specific remedies (including but not limited to interim remedies) are regulated by Family Court (Composition and Distribution of Business) Rules 2014 (S.I. 2014/840) rule 17 and Schedule 2. Thus, only judges of district judge level and above may grant a freezing order (whether under section 37 of the Senior Courts Act 1981 or under section 37 of the Matrimonial Causes Act 1973), or any other interim injunction or declaration. Only judges of High Court level may grant a search order.

20.4 An example of the use of an unspecified remedy is Nugent v Nugent [2013] EWHC 4095 (Ch), [2014] 3 WLR 59, where it was held that the High Court had the inherent power to vacate a unilateral notice registered under the Land Registration Act 2002. On the facts Morgan J lifted the notice to allow the 99-year-old defendant to raise funds either by sale or mortgage of her home in order to defend the claim against her. Another is the ‘bolstering injunction’ requiring the payer of a periodical payments order to maintain the source thereof (in that case an Indian annuity) and to procure payment of the sums deriving from it to the payee: Goyal v Goyal (No 2) [2016] EWFC 50, [2017] 2 FLR 236 and Goyal v Goyal (No 3) [2017] EWFC 1, [2017] 4 WLR 31, applying Blight & Ors v Brewster [2012] EWHC 165 (Ch), [2012] 1 WLR 2841 and Tasarruf Mevduati Sigorta Fonu v Merrill Lynch Bank and Trust Company (Cayman) Ltd [2011] UKPC 17, [2012] 1 WLR 1721. A further example is an order requiring a transferee of a property to use his or her best endeavours to procure the release of the transferor from relevant mortgage covenants, to keep up the mortgage payments after transfer, and in any event to indemnify the transferor: CH v WH (Financial Provision: Approval of Consent Order) [2017] EWHC 2379 (Fam), [2017] 4 WLR 178.

20.5 These instances are not, it is true, examples of unspecified interim remedies, but they do illustrate the extent of the inherent powers of the High Court, and thus of the Family Court, in circumstances where section 31E of the Matrimonial and Family Proceedings Act 1984 provides that, in any proceedings in the Family Court, the court may make any order which could be made by the High Court if the proceedings were in the High Court.

20.6 An order to impound a passport may be made in support of a claim for a financial remedy, see Young v Young [2012] EWHC 138 (Fam), [2012] 2 FLR 470 where the principles were summarised at [26]:

i) The power to impound a passport pending the disposal of a financial remedy claim exists in principle in aid of all the court’s procedures leading to the disposal of the proceedings.

ii) But it involves a restriction of a subject’s liberty and so should be exercised with caution. The authorities emphasise the short-term nature of the restraint. The law favours liberty.

iii) A good cause of action for a substantive award must be established.

iv) The Applicant must establish that there is probable cause for believing that the Respondent is about to quit the jurisdiction unless he is restrained.

v) And the Applicant must further establish that the absence of the Respondent from the jurisdiction will materially prejudice her in the prosecution of her action.

vi) Provided that the principles in (i) to (v) are carefully observed a passport impounding order will represent a proportionate public policy based restraint on freedom of movement founded on the personal conduct of the Respondent.

20.7 In Bhura v Bhura [2012] EWHC 3633 (Fam), [2013] 2 FLR 44 at [51] Mostyn J enlarged on this in relation to the proper form of the order and its availability following judgment:

In my decision of Young v Young [2012] EWHC 138 (Fam), [2012] Fam 170 I attempted to summarise the law in relation to passport impoundment orders. It was implicit in my reasoning that the modern form of order is an injunction restraining the Respondent from leaving the jurisdiction and requiring his passport to be held either by the tipstaff or, as in this case, the Applicant’s solicitors. The writ ne exeat regno is a charming historical relic but must be regarded as an anachronism given the availability of the modern form of order. The decision of B v B (injunction: jurisdiction) [1997] 2 FLR 148, [1998] 1 WLR 329 establishes that after judgment an injunction restraining movement out of the jurisdiction cannot be made as a free-standing measure of enforcement. It has to be linked to another measure and must be time-limited. Accordingly, I discharge the existing writ and make a fresh injunction which will endure until the matter is returned to me pursuant to the preceding paragraph, or until the Respondent discharges his obligations, if earlier.

20.8 In Re B (A Child) (Removal from Jurisdiction: Removal of Family’s Passports as Coercive Measure) [2014] EWCA Civ 843, [2015] Fam 209 Sir James Munby P at [33] confirmed that a passport order intended purely to coerce compliance with a previous order is outside the proper ambit of the court’s powers. The order must be auxiliary to an existing procedure.

20.9 The interim remedies most likely to be sought in financial remedy proceedings prior to judgment are those mentioned in rule 20.2(a), (b), (c), (f), (g), (h) and (j):

(a) an interim injunction;

(b) an interim declaration;

(c) an order—

(i) for the detention, custody or preservation of relevant property;

(ii) for the inspection of relevant property;

(iii) for the taking of a sample of relevant property;

(iv) for the carrying out of an experiment on or with relevant property;

(v) for the sale of relevant property which is of a perishable nature or which for any other good reason it is desirable to sell quickly; and

(vi) for the payment of income from relevant property until an application is decided; …

(f) an order (referred to as a ‘freezing injunction’)—

(i) restraining a party from removing from the jurisdiction assets located there; or

(ii) restraining a party from dealing with any assets whether located within the jurisdiction or not;

(g) an order directing a party to provide information about the location of relevant property or assets or to provide information about relevant property or assets which are or may be the subject of an application for a freezing injunction;

(h) an order (referred to as a ‘search order’) under section 7 of the Civil Procedure Act 1997 (order requiring a party to admit another party to premises for the purpose of preserving evidence etc.); …

(j) an order for a specified fund to be paid into court or otherwise secured, where there is a dispute over a party’s right to the fund.

20.10 In UTB LLC v Sheffield United Ltd [2018] EWHC 1663 (Ch), [2018] 1 WLR 5195 Fancourt J considered the scope of CPR rule 25.1(1)(c)(i), which is in identical terms to FPR rule 20.2(1)(c)(i). At [42] he held that, while something physical that could be inspected, preserved and experimented upon would be the paradigm case of ‘relevant property’, the rule included other types of property. ‘Relevant property’ was property which was the subject of a claim or as to which any question might arise on a claim. While intangible property, such as shares or some intellectual property, could not be detained, inspected, sampled or experimented upon, that did not mean that it could not be relevant property for the purposes of CPR rule 25.1(1)(c)(i).

20.11 In Goodrich Actuation Systems Ltd v Valente [2018] EWHC 3241 (Ch) (reported on Westlaw) Arnold J granted an order under CPR rule 25.1(1)(c)(ii) (which is in identical terms to FPR rule 20.2(1)(c)(ii)) for an SJE to undertake a forensic examination of a personal laptop belonging to a former employee of a company which had alleged that she had downloaded confidential information onto a USB memory device and accessed it using that laptop. Such an order was proportionate and necessary, and the issues between the parties were such that they could not be determined simply by disclosure or searches.

20.12 Rule 20.2(1)(c)(v), which permits an order for sale to be made of ‘relevant property which is of a perishable nature or which for any other good reason it is desirable to sell quickly’ was considered in Joy v Joy [2015] EWHC 455 (Fam). In that case the wife had issued an application for general enforcement under rule 33.3(2)(b). Rule 20(2) defines relevant property as ‘property (including land) which is the subject of an application or as to which any question may arise on an application’. Sir Peter Singer held that within that application there was jurisdiction to order the sale of a motor car. At [40] he stated:

In deference to the careful arguments put forward by Mr Pointer I will just very simply at this stage state my interim conclusion as being that the words of the provision ‘or which for any other good reason it is desirable to sell quickly’ are not limited by and therefore do not need to fall within the asserted genus of ‘relevant property which is of a perishable nature’. It is tolerably plain to me that the second scenario in rule 20.2(1)(c)(v) is intended by the draftsman to be a true alternative and is not to be interpreted ejusdem generis with the first.

20.13 In BR v VT [2015] EWHC 2727 (Fam), [2016] 2 FLR 519 the court held that there are three procedural routes whereby the court may make an interim order for the sale of a piece of property during the pendency of the ancillary relief proceedings. The first is by means of an order made under section 17 of the Married Women’s Property Act 1882 (as clarified by section 7(7) of the Matrimonial Causes (Property and Maintenance) Act 1958 which expressly confirms the power to order a sale). The second is by an order made under sections 13 and 14 of TOLATA. This route depends on both spouses having a beneficial interest in the property. The third is under FPR 2010 rule 20.2(1)(c)(v) (at [2]). When making an order for sale the court has power to make a supplementary order requiring an occupant of the property to give vacant possession of it (at [4]). If the application is for the sale of the matrimonial home occupied by the other spouse, then the court cannot order vacant possession of it without first undertaking the exercise required by section 33 of the Family Law Act 1996 (at [7]).

20.14 In WS v HS [2018] EWFC 11, [2018] 2 FLR 528 Cobb J disagreed that FPR 2010 rule 20.2(1)(c)(v) supplied a free-standing power to award an interim sale of a piece of property. However, he did not dispute that section 17 of the 1882 Act supplied such a power as did (where the property was jointly owned) sections 13 and 14 of TOLATA. In SR v HR [2018] EWHC 606 (Fam), [2018] 2 FLR 843 at FN1 Mostyn J maintained his view, stating:

An order for the sale of property is essentially procedural; of itself it does not alter proprietary rights. I cannot see that words should be read into the rule to the effect that to make such an order an underlying statutory power must be identified. In my opinion to provide in the rules the independent power to order an interim sale is not ultra vires the parent statute (sections 75 and 76 Courts Act 2003). However, until the matter can be resolved by a higher court I suggest that applications for an interim sale are made under section 17 of the Married Women’s Property Act 1882. Such an application is to be made in short form under the Part 18 procedure within the financial remedy proceedings: see FPR 8.13 and 8.14.

It is not clear from the report of WS v HS why Cobb J did not treat the Part 20 application in that case as being made under section 17 of the 1882 Act and FPR rules 8.13 and 8.14.

20.15 In UTB LLC v Sheffield United Ltd (above) Fancourt J was in no doubt that the equivalent rule in the CPR empowered the court to order a sale of property which is the subject of a claim or as to which any question may arise on a claim, holding that ‘intangible property, such as shares or some intellectual property … can be preserved, or sold if there is good reason to sell them quickly, or income from them can be paid to an applicant until trial’.

20.16 There have been no reported cases under FPR rule 20.2(1)(g). In Gerald Metals SA v Vasile Frank Timis [2016] EWHC 2136 (Ch) Rose J considered an application under CPR rule 25.1(1)(g), which is in the same terms. The applicant company claimed damages of US$75m plus interest for breach of contract and deceit regarding a debt which the respondent T accepted was owed by his family trust. The applicant applied on notice for an order under CPR rule 25.1(1)(g) requiring T to provide information regarding assets that could be the subject of a freezing order. The application was granted. Rose J held that in approaching rule 25.1(1)(g) there were two stages to consider, the jurisdictional threshold and the court’s discretion. The threshold for an order was lower than that for freezing assets. The likelihood of dissipation did not have to be on the balance of probabilities but based on credible evidence and a reasonable possibility. The wording of the sub-rule was ‘assets which are or may be’ subject to a freezing order. The provision would lose its utility if it were necessary to show that a freezing order would, in due course, be applied for; it was enough that it might be. In its discretion the court considered the case to be a suitable one for granting the application: there was a strong likelihood at least of a freezing order; there was a lack of clarity as to what the assets were to back a guarantee; the applicant needed the information to make an informed decision and would be significantly prejudiced if it had to wait longer.

20.17 In Candy & Ors v Holyoake & Anor [2017] EWCA Civ 92, [2018] Ch 297 Gloster LJ echoed these views at [47], saying:

Conventional freezing orders, notification injunctions and other potential variations of freezing orders – on the one hand – should be distinguished from orders for the disclosure of information under CPR r 25.1(1)(g). In JSC Mezhdunarodniy Promyshlenniy Bank v Pugachev [2016] 1 WLR 160, the Court of Appeal considered at [44]–[59] the relationship between freezing orders and orders for disclosure of information. I agree with Lewison LJ’s observation at [55] that:

‘An order for the provision of information is far less intrusive than an order which prevents someone from dealing with assets.’

That is because a requirement to disclose does not include a prohibition on dealing with assets.

This chapter in the book also covers: Interim injunctions, Freezing injunctions & search orders, Post-judgment freezing orders, Exception for expenditure in the ordinary and proper course of business, Living expenses allowance, Search Orders, De facto and shadow directors; control of a company, Notification injunction, Delay, Sentencing Guidelines, Cross-examination of a party subject to a freezing order, Variation of a freezing injunction, Interim Declarations, Procedure, Form of order for an injunction, Applications made without notice: procedure, Applications made without notice: principles, Third parties affected by an order, Security for costs, Content and form of order for security for costs and Security for costs of an appeal.


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