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1. The Hong Kong Court Has Power To Grant Interim Injunctions
In cases where there is a real risk that a Defendant or intended Defendant will dissipate assets to avoid a claim, the Hong Kong Court may upon application order that the Defendant's assets be frozen until the determination of the claim. If the writ has not yet been issued the Plaintiff will have to undertake to do so forthwith.
2. Mareva Injunctions Such injunctions
are known as mareva injunctions. There are strict requirements as to full and frank disclosure of all relevant material including matters favourable to the Defendant that are within the Plaintiff's knowledge. Recently this power has been extended to cover cases where the original proceedings are brought in a court outside Hong Kong provided that any judgement in the overseas proceedings can be enforced in Hong Kong.
3. Procedure
The order will be made based on affidavit evidence from the Plaintiff and his witnesses. When the injunction is granted the Court will fix a return date when the Defendant will be entitled to appear before the Court and argue that the injunction be lifted. The Defendant will also be entitled to file affidavits in support of his case. If the injunction is not lifted the Defendant will be entitled to apply to Court for part of the frozen assets to be released for his living expenses and his legal costs for defending the action.
4. Anton Piller Orders
This order entitles person to enter the Defendant's premises without notice and search for, seize and temporarily retain documents and articles relevant to the Plaintiff's claim where there is a real risk that the Defendant may destroy or remove the items. Once again strict requirements must be complied with and the Defendant will be given an opportunity to overturn the order. The order will specify the manner in which the search is to be conducted and the persons making the search.
In both cases the Plaintiff will have to give undertakings, most notably that if the Court should eventually find in favour of the Defendant the Plaintiff will comply with any order the Court may make as to damages in favour of the Defendant for loss caused by granting the injunction.
5. Test To Be Applied
These are just two examples of the types of interlocutory injunctions that Hong Kong Courts may order. Whatever the circumstances the Court in deciding whether to grant the injunction will first of all consider, based on the evidence before it, whether damages would be an adequate or feasible remedy to the injury complained of. If the Court finds that damages would not be an adequate remedy it will embark on a process of ascertaining the balance of convenience. That is to say the Court will consider which party would suffer the greater hardship if it looses the injunction hearing and yet goes on to succeed at trial. The decision will then be made in favour of the party likely to suffer greater hardship.
Whilst every effort has been made to ensure the accuracy of this article it is general in nature and does not constitute legal advice of any kind. You should seek your own personal legal advice before taking legal action. We accept no liability whatsoever for loss arising out of the use or misuse of this article.
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