Worldwide Freezing Orders – Partner Nicola McKinney featured in Law36016 Jan, 2019 - General | by Grosvenor Law
Worldwide Freezing Orders (WFOs) are currently the subject of much international attention highlighted by the recent case of FSDEA v Dos Santos, where a breach of disclosure meant the order was discharged. These orders may seem appealing as they are extremely effective – if a defendant fails to comply with a WFO they may be found in contempt of court, which can attract a prison sentence.
However, the risks to law firms and their clients are huge when seeking such an order without careful consideration. While a WFO will prevent an individual from disposing of their assets, the flip side is that any breaches in disclosure obligations from the entity seeking the order will be embarrassing, costly and likely to result in the order being lifted.
Grosvenor Law acted for the successful second respondent in FSDEA, helping to ensure the order was discharged by showing that the applicant had not disclosed crucial documents and information during the hearing. The judge found eight counts of “non-disclosure and an unfair presentation” which undermined the applicant’s case for the WFO, and so the freezing order was immediately discharged.
In response to the case, in an exclusive feature published by Law360, Grosvenor Law Partner Nicola McKinney examines WFOs and explain their risks and benefits. She reviews the obligations upon the applicant, considers the penalties for breaching the duty of disclosure, and outlines the duties for legal advisors in these cases.