STEPS TO TAKE IF YOU HAVE BEEN SERVED WITH A FREEZING ORDER PART 2
Examine carefully the grounds the Applicant relied upon in order to obtain the Freezing Order
In order to obtain a without notice Order, the Court has to be satisfied that there are very strong grounds to grant such a serious order.
Ordinarily, both sides to a claim are entitled to attend a hearing, but in circumstances where only one party (i.e. the Applicant) attends court, the Court has to be satisfied that there are very strong grounds for the granting of such an Order. The nature and basis of the obligations imposed on an Applicant are set out in more detail in other posts in our fraud series.
Once armed with a full note and/or transcript of the hearing, we would recommend that the person served with the Freezing Order (or his / her legal advisers)examine carefully the grounds relied upon by the Applicant at the time the Freezing Order was granted. In so doing, a person can then not only begin to formulate your response but also to see whether the Freezing Order itself can be varied and/or discharged.
Examine carefully the extent of the disclosure made to the Court on behalf of the Applicant
When granting Freezing Orders, there is a duty on the Applicant of what is known as “Full and Frank Disclosure”. Essentially, the Applicant must be completely truthful and disclose to the Court all matters and factswithin its knowledge at the time of seeking the Order, even if they are unhelpful to the Applicant. It is not simply the case that the Applicant can turn up to court on a without notice basis and present to the court information which only helps the Applicant but does not reveal information which might be damaging to the application.
If that is the case and the Applicant has clearly failed to provide full and frank disclosure to the Court at the time of the granting of the Order, this can be a ground to have the Freezing Order discharged or varied on terms. The Court insists upon full and frank disclosure because of the one sided nature of these applications and the fact that the Respondent is unaware of them until such time as it is served with the Court papers.
Read the Order Carefully and Fully Understand its Terms
It is imperative that a person served with a Freezing Order sits down and reads the terms of the order very carefully indeed – and as soon as it has been served. Often,Freezing Orders come with what is called a Penal Notice i.e. a notice which explicitly states that failure to comply with the terms of the Order can result in imprisonment and/or a fine. By their nature, Freezing Orders are one of the most draconian forms of Order a court can make. It is therefore imperative that a person takes the time to read the terms of the Order properly and invests sufficient time to understand it fully.
In so doing, we would strongly recommend that if a person has been served with a Freezing Order, that he/she seeks legal advice with regard to the terms of the Order as,bluntly put, non-compliance can result in a finding of Contempt of Court and the ultimate sanction for that is imprisonment. Often, Respondents served with such Orders are faced with very onerous obligations, often relating to disclosure of documents. These obligations can come into existence at the very time the Order is served on a person by a process server acting on behalf of the Applicant.
Anyone served with a Freezing Order is entitled to take their time to read the terms of the Order and fully understand it. The process server should even take the time to readout the key provisions of the Order (although they are not qualified to explain or interpret any such provisions).