Freezing Injunctions

In cases where there is a risk that assets may be dissipated, it may be necessary to apply for a freezing injunction.

More about Freezing Injunctions

This is a legal order that prevents a party from disposing of or dealing with assets in any way. Forbes Solicitors has extensive experience in obtaining freezing injunctions and can provide expert advice and representation throughout the process.

What is a Freezing Injunction?

What is a Freezing Injunction?

A freezing injunction is a court order that prohibits a person from disposing of their assets or removing them from the jurisdiction. This type of injunction is often used in cases where there is a risk that a person may dispose of their assets in order to avoid paying a debt, to hide assets from a spouse or satisfying a court order. Freezing injunctions can be an effective way of protecting assets in legal proceedings.

A freezing injunction is an interim order made by a Court that prohibits a party from disposing of or dealing with the assets listed under the order.

They are relatively rare and not granted lightly because a freezing injunction in effect punishes someone in anticipation of them committing an act which may deny the other party their full divorce settlement. In simple terms they can be seen as a way of preventing the hiding of assets.

What Type of Assets Can Be Covered By A Freezing Injunction?

What Type of Assets Can Be Covered By A Freezing Injunction?

A freezing injunction can cover any type of asset, including bank accounts, property, shares, and other investments. It can also cover assets held by third parties, such as family members or business associates, if there is reason to believe that they are being used to hide or transfer assets. The purpose of a freezing injunction is to prevent the defendant from disposing of or dissipating their assets before a judgement can be obtained.

Normally, a freezing injunction will require the respondent to give full and frank disclosure of the type, value and location of his or her assets.

All types of assets can be frozen either in the UK or abroad including:

Bank accounts; Cars; Property; Business assets; Shares and bonds; and Intangible assets such as goodwill cannot be frozen by the injunction. Before you even think about applying for a freezing injunction, you need to be aware that they are:

Costly; Require full and frank disclosure on many issues regarding your marital finances that you may prefer to keep private; and If it is later found that the injunction should not have been granted you may be required to pay damages to your former spouse. Freezing injunctions are usually applied for before proceedings are issued, however, you can seek them at anytime, including after the judgment has been obtained but not yet executed. Section 44 of the Arbitration Act 1996 gives the Court power to grant a freezing injunction in support of arbitration proceedings being held in an overseas jurisdiction.

Applications for a freezing injunction can be made without notice to the defendant. To succeed in obtaining the injunction, an applicant must provide an application form as well as evidence to support the application in the form of an affidavit.

When assessing whether there are grounds to grant a freezing injunction the Court will consider:

Whether the applicant has a 'good, arguable case' for applying for the order; and that there is a real risk that any judgment of financial relief made in favour of the applicant will go unsatisfied. It is just and convenient to grant the injunction. The Court has to take great care in granting a freezing injunction as innocent third parties such as business partners can be adversely affected by them.

What if your former spouse has already disposed of assets in order to defeat your claim?

What if your former spouse has already disposed of assets in order to defeat your claim?

An Avoidance of Dispositions Order is an order by the High Court setting aside or preventing a transaction by one party (either the husband or wife) that was/is being made with the aim of defeating his/her spouse's application for financial provision.

Avoidance of Disposition Orders are governed by Section 37 of the Matrimonial Causes Act 1973. Section 37(5) of the Act provides that the intention to defeat the other party's claim to financial relief is presumed if the disposition of the property/asset took place less than three years before the application.

If the presumption is not rebutted the transaction will be set aside unless:

The asset was exchanged for appropriate monetary value; and the person who acquired the property/asset acted in good faith and was unaware that the respondent's goal was to deny the applicant's full financial settlement that the Court ruled they were entitled to. In the recent case of AC v DC (No 1), Mostyn J explained succinctly what the applicant in the case had to prove in order to have her request to set aside her husband's transfer of a shareholding actioned by the Court.

In this case the wife had to show:

That the transfer of the shares was done with the intention of defeating the applicant's claim for financial relief (in this case intention was presumed and not successfully rebutted); The transferring of the shares resulted in the defeating of the applicant's claim for financial relief; and Under Section 23(2) of the Matrimonial and Family Proceedings Act 1984, the Court should exercise its discretion and set aside the share transfer.

Freezing Injunctions FAQs

When can a freezing injunction be obtained?

A freezing injunction can be obtained when there is a serious risk that a defendant may dispose of or dissipate their assets to avoid paying a potential judgement. The applicant must demonstrate a good arguable case and that there is a real risk of dissipation. The court will consider the balance of convenience and whether the injunction is necessary to prevent injustice.

How long does a freezing injunction last?

A freezing injunction can last until the end of the legal proceedings or until the court orders otherwise. It is a temporary measure that is put in place to preserve assets until a final decision is made. The duration of the injunction will depend on the circumstances of the case and the court's discretion.

What is the process for obtaining a freezing injunction?

To obtain a freezing injunction an application must be made to the court. The applicant must provide evidence of a valid claim against the respondent and demonstrate that there is a risk that the respondent's assets will be dissipated or removed from the jurisdiction. The court will consider the evidence and may grant the injunction, which will freeze the respondent's assets until the claim is resolved.

What evidence is required to obtain a freezing injunction?

To obtain a freezing injunction the applicant must provide evidence that there is a real risk that the respondent will dissipate their assets to avoid paying a potential judgement. The evidence must be clear and convincing, and the court will consider factors such as the strength of the applicant's case, the respondent's financial position, and any previous attempts to dispose of assets.

Can a freezing injunction be obtained without notice to the other party?

Yes, a freezing injunction can be obtained without notice to the other party in exceptional circumstances where there is a real risk that the other party will dissipate their assets to frustrate the claimant's claim. This is known as a "without notice" or "ex parte" application. However, the claimant must provide full and frank disclosure of all material facts to the court and must have a strong case on the merits.

What happens if the other party breaches a freezing injunction?

If the other party breaches a freezing injunction, they may be held in contempt of court and face penalties such as fines, imprisonment, or seizure of assets. The court may also order the frozen assets to be released to the claimant.

Can a freezing injunction be challenged or set aside?

Yes, a freezing injunction can be challenged or set aside. The party subject to the injunction can apply to the court to have it discharged or varied. The court may also set aside the injunction if it was improperly obtained or if there has been a material change in circumstances. However, the burden of proof is on the party seeking to have the injunction set aside.

Our dedicated Family/Divorce team

Jessie McDonald.jpg

Partner and Head of Department, Family/Divorce

Rubina Vohra

helen-shirbon.jpg

Partner and Head of Department, Family/Divorce

Helen Shirbon

gill-carr.jpg

Partner, Family/Divorce

Gill Carr

Contact Us

If you have an enquiry then please fill in your details and someone will contact you.

0800 689 1058 - Monday - Friday: 09:00 - 17:00

Request a call back

By submitting your enquiry you agree that Forbes can contact you.

© 2024 Forbes Solicitors is the trading name of Forbes Solicitors LLP Offices in Preston, Manchester, Salford, Blackburn, Blackpool, London and Leeds UK Main Office: Rutherford House, 4 Wellington Street (St Johns), Blackburn, Lancashire, BB1 8DD • Vat No: 174 394 344 Forbes Solicitors is authorised and regulated by the Solicitors Regulation Authority (SRA No. 816356). Details of the SRA’s Standards and Regulations can be found here.

This website has implemented reCAPTCHA v3 and your use of reCAPTCHA v3 is subject to the Google Privacy Policy and Terms of Use.