ACTION NO. 438

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BEFORE the Hon. Chief Justice Abdulai Conteh.

Mr. E. Andrew Marshalleck for the Applicant

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DECISION

When this application came before me in chambers on 1st June 2000, I granted the several orders sought to the Applicant and promised to give reasons for my decision. I now do so.

When the principal action itself came up for trial on 2nd February 2000 before Shanks J., he ordered that judgment be entered for the Plaintiff against the Defendants in the sum of $12,104.00 plus interest thereon at 2 per cent per annum from the date of the issue of the Writ (10 November 1998) until the date of the judgment and costs to be taxed if not sooner agreed.

By the present application dated 17 April 2000 the Applicant has approached this court ex parte seeking the following orders, that:

1) The second named Defendant disclose to the Plaintiff on Affidavit on or before a specified date the value and whereabouts of all assets it owns within the jurisdiction,

2) The second named Defendant be restrained until further Order whether by itself its servants or agents or otherwise howsoever from removing from the jurisdiction any of its assets within the jurisdiction including but not limited to funds held on account at Barclays Bank PLC, Belize City, Belize, and/or any account held within the jurisdiction or any branch of the Atlantic Bank Ltd., Scotia Bank Limited and/or the Belize Bank Limited, so as to reduce the value of the assets within the jurisdiction below $15,900.47 being the sum of judgment awarded against the Defendant on 14 February, 2000,

3) The second named Defendant be restrained until further order whether by themselves or by its servants, agents or otherwise from disposing of, mortgaging, assigning, charging or otherwise dealing with any of their assets from within the jurisdiction including but not limited to funds held on account at Barclays Bank PLC in Belize and/or any accounts held within the jurisdiction at any branch of the Atlantic Bank Limited, Scotia Bank Limited and/or the Belize Bank Limited or to otherwise dissipate those assets so as to defeat the judgment obtained against the Defendants as aforesaid save to the extent that the unencumbered value of those assets exceeds $15,900.47; and

4) The costs of this application be costs in the cause.

In support of this application there were filed a 12 paragraph Affidavit deposed to by the Applicant/Judgment creditor.

I call the Applicant "the judgment creditor" because there is extant in his favour a judgment of this Court which at the time of the application was not satisfied either in whole or in part. And it is the prospect that this position will remain such that has, I believed, prompted this application.

At the heart of this application is the question as to the extent a successful litigant, in this case the plaintiff, can invoke the aid of the court to ensure satisfaction of a judgment in his favour so that that judgment is not rendered empty because the Defendant, even though not anymore present within the jurisdiction, has or possibly has assets within the jurisdiction, which the successful plaintiff, the judgment creditor, apprehends may be spirited away out of reach of the Court.

The facts that gave rise to the judgment which has triggered off this application and succinctly stated in paragraph 2 of the Applicant's Affidavit: he sued on 10 November 1998 to recover damages for personal injuries caused by the negligent driving of the First Defendant as a servant or agent of the Second Defendant on the Northern Highway on 8 July 1998.

The Attorney for the Applicant in making the application informed the Court that there was initially a default judgment obtained against both Defendants. But this was subsequently set aside. The issues then went to trial at which both Defendants were represented by counsel before Shanks J. who eventually gave judgment for the Plaintiff.

In the Affidavit of the Applicant, it is stated that the First Defendant is impecunious, that the Attorneys for the Second Defendant were unable to make contact with the Second Defendant, and that the insurers of the second Defendant have repudiated liability. (see paragraphs 5 and 6 of the Affidavit).

The Affidavit evidence further discloses that the second Defendant is a company duly registered and operating in South Africa and has ceased to operate its business in Belize. But prior to ceasing operations locally here, the second named Defendant drew cheques on an account at Barclays Bank PLC, Belize City, Belize. The Applicant believes that this bank account may be the only asset of the second named Defendant within the jurisdiction capable of satisfying the judgment in his favour. (see paragraphs 8 and 9 of the Applicant's Affidavit).

The Applicant therefore fears that unless this Court restrains the second named Defendant, it would close its bank accounts and remove its assets outside the jurisdiction and thereby render the judgment against it "unenforceable". Hence this application.

The Applicant/judgment creditor has now applied for what is in essence a Mareva injunction to restrain the second defendant from dealing with or disposing of its assets within the jurisdiction comprising its bank account here in Belize, save in so far as those assets exceed the sum of $15,900.47 the judgment sum.

Generally, in so far as injunctions are concerned, there is a statutory basis here in which they are firmly anchored, namely section 26 of the Supreme Court of Judicature Act - Cap. 82. This section however opens in subsection (1) with these words "Subject to the rules of Court, the Court may grant . . . injunction . . . in all cases in which it appears to the Court to be just or convenient to do so".

Our Rules of Court provide in Order 54 the additional basis for the exercise of the Supreme Court of its jurisdiction in relation to Interlocutory Orders as to Mandamus, Injunctions or interim Preservation of Property etc.

The Statutory basis for injunctive relief has been given a very wide interpretation by the Courts over the years. For example, section 26(1) of the Supreme Court Act - Chapter 82, has been given a rather wide ambit in England where, I venture to say, it originated as section 45 of the Supreme Court of Judicature (Consolidation) Act 1925, which itself was a repetition of section 25(8) of the Judicature Act 1873 of that country in this form:

"A mandamus or an injunction may be granted or a receiver appointed by an interlocutory Order of the Court in all cases in which it shall appear to the Court just or convenient".

This is almost, ipsissima verba with section 26(1) of the Belize Supreme Court Act.

In Beddow v Beddow (1878) 9 Ch. D. 89 at page 93, Jessel MR in relation to the analogous provision in section 25(8) of the English Judicature Act 1873, for example, stated: "I have unlimited power to grant an injunction in any case where it would be right or just to do so".

The effect of this statutory basis the Court's jurisdiction in relation to injunctions has been stated thus: ". . . whenever a right which can be asserted either at law or in equity does exist, . . . the Court is now enabled by virtue of this provision, in a proper case, to grant an injunction to protect that right" - Vol. 24 Halsbury's Laws (4th edition) at paragraph 918.

I have taken time to refer to this development concerning section 26(1) of the Supreme Court of Judicature Act, because it was from the same source in an analogous provision that the Court of Appeal in England under Lord Denning MR, launched what has come to be popularly called the Mareva injunction after the name of the case from which this particular remedy derived its eponym: Mareva Compania Naviera SA v International Bulkcarriers SA - The Mareva (1980) 1 All E.R. 213. In this case, the plaintiffs who feared that the defendants might transfer their assets out of the jurisdiction of the Court got an injunction restraining them from disposing of their assets within the jurisdiction.

The case from which this particular remedy got its name was a prejudgment one, that is before the plaintiffs had obtained judgment. They had merely issued a writ against and served it on agents of the Defendants while at the same time applying to serve it out of the jurisdiction.

This was an extension of the remedy for Court of Appeal in England first introduced in 1975 when it granted an injunction on an application without notice restraining defendants from disposing of or dealing with any of their assets within the jurisdiction of the Court: Nippen Yusen Kaisha v Karayeorgis (1975) 1 WLR 1093.

These injunctions are now known in England under the new Civil Procedure Rules (which came into operation in April 1999 in that country) by the nature of their effect on the assets in respect of which the Court may make an order: They are now called Freezing injunctions": Part 25 of the English Civil Procedure Rules and the Practice thereunder - (Civil Procedure second edition (1999 a White Book Service) at page 307 et seq.)

It came to be recognized that in a suitable case an injunction will be granted even after judgment in order to prevent the judgment debtor from disposing of his assets to the prejudice of the judgment creditor and thereby rendering the judgment itself nugatory - Orwell Steel (Erection and Fabrication) v Asphalt and Tarmac (UK) Ltd. (1984) 1 WLR 1097.

Here in Belize, the Courts have for long exercised jurisdiction to grant injunction in circumstances not too dissimilar from the instant case occasioned by this application. In James Brodie & Co. Ltd. v Juarez 1 Bz.L.R. (1994) 249 this Court granted an injunction in favour of the plaintiff, who had a valid claim for goods sold and delivered to the defendant, restraining the latter from removing out of the jurisdiction a truck detained at the Mexican border, on the ground that the defendant resided outside the jurisdiction and had no known assets in Belize other than the truck.

The principle that a judgment debtor can be restrained by an injunction from disposing of assets so as not to stultify a judgment against him is today, an undoubted part of the Court's jurisdiction, and can in an appropriate case be exercised. This jurisdiction can, in a suitable case, be exercised to reach funds of the judgment debtor in the hands of a third party. Thus, in Mercantile Group (Europe) A.G. v Aiyela and others (1993) WLR 1116, the Court of Appeal in England held that the plaintiff judgment debtor had a substantive right in the judgment debt owed by the first defendant, and therefore had a right to an interlocutory injunction against the fourth defendant, the wife of the first defendant who had been involved in her husband's financial affairs and had assets held by them both. The Court there held that the defendant's right to an interlocutory injunction against the fourth defendant did not exist in isolation but was incidental to and dependent on the enforcement of that substantive right and that accordingly there was jurisdiction to impose the Mareva injunction on the fourth defendant.

Hoffman L.J. stated the position thus:

"In this case, the plaintiff's substantive right is a judgment debt owed by Mr. Aiyela. The Mareva injunction against Mrs. Aiyela is incidental to and in aid of the enforcement of that right. Although Mareva injunction in advance of judgment date from 1975, post-judgment injunctions against third parties in aid of the enforcement of a judgment debt have a much longer history. In Bullus v Bullos (1910) 102 L.J. 399, Mrs. Bullus had a claim for arrears of maintenance under an Order made against her husband and an unsatisfied Order for costs. He became entitled to a legacy and the Court granted an interlocutory injunction to restrain the trustees of the will from paying him the money. The order was in principle no different from a post-judgment Mareva against a third party to prevent dissipation of a fund to which the judgment debtor is beneficially entitled and upon which the creditor may be entitled to execute. It is true that in Bullus case the debtor was indisputably entitled to the legacy whereas here the interest of Mr. Aiyela in the funds in Mrs. Aiyela's accounts is a matter in dispute. But this does not affect the jurisdiction".

This case also decided that a disclosure of assets can be made, in an appropriate case, against even a third party.

In this application, there is evidence that the second Defendant had a bank account at Barclays Bank PLC, in Belize City, and that it is a company registered and operating in South Africa although it has ceased to operate here in Belize. The Applicant apprehends that unless this Court intervenes, there is nothing to stop the second Defendant from closing its account with Barclays Bank and removing its assets therein (presumably the funds in the account) outside the jurisdiction of this Court thereby rendering the judgment against its nugatory as there would be nothing to execute against.

Although the summons in this application prays the aid of the Court in restraining the second named Defendant from removing or dissipating its assets within the jurisdiction in its accounts with Atlantic Bank Limited, Scotia Bank Limited and the Belize Bank Limited, in addition to its account with Barclays Bank PLC, there is however no evidence that it operated accounts with the three other banks, apart from Barclays.

I however believe that it is meet and proper and that in the circumstances of this case, it is as well just and convenient to bring in under the aegis of the restraining Order any account the second Defendant may have with these other banks as well. Otherwise, in this age of technology, by the click of a button, those funds might be spirited away from out of the jurisdiction.

In the light of this I order that the second Defendant disclose to the plaintiff/Applicant on affidavit not later than 15 June 2000 the value and whereabouts of all its assets within the jurisdiction and that in the meantime from the date of the Order in this application until further Order, the second named Defendant be restrained and is hereby restrained whether by itself, its servants or agents or otherwise howsoever from removing from the jurisdiction any of its assets within the jurisdiction including but not limited to funds held on account at Barclays Bank PLC, Atlantic Bank Limited, Scotia Bank Limited and the Belize Bank, in Belize, so as to reduce its assets within the jurisdiction below $15,900.47 being the judgment sum awarded to the plaintiff/Applicant against the Defendant on 14 February 2000; And that the second Defendant be further restrained and is hereby restrained until further Order whether by itself, or its servants, agents or otherwise howsoever from disposing of, mortgaging, assigning, charging or otherwise dealing with any of its assets within the jurisdiction including but not limited to funds held on account at Barclays Bank PLC; Atlantic Bank Limited, Scotia Bank Limited and the Belize Bank Limited in Belize, or to otherwise dissipate those assets so as to defeat the judgment against the second Defendant as aforesaid except to the extent that the unencumbered value of those assets exceeds the sum of $15,900.47.

The cost of this application shall be $1,000 in favour of the Applicant.

A. O. CONTEH
Chief Justice

Dated: 5th June, 2000.