Take 10 Harneys Offshore Law

In this episode of our Take 10 podcast, Asia Managing Partner Ian Mann and Counsel Andrew Chin talk about how the legislature and judiciary of the British Virgin Islands (BVI) and the Cayman Islands are constructing a favourable landscape for the application of interim measures in aid of international arbitration, no matter where those arbitrations are seated.
Key takeaways:
The BVI and Cayman Islands have established themselves as one of the key commercial jurisdictions in favour of arbitration by integrating the UNCITRAL Model Law on International Commercial Arbitration into their legislative framework and adopting a pro-enforcement judicial attitude to the enforcement of arbitral awards.The most common type of interim measures taken in support of arbitration in the BVI and the Cayman Islands are Norwich Pharmacal applications to find out the identity and nature of the wrongdoers and applications for a freezing order to restrain the unlawful dissipation of assets.Regulatory arbitrage is more prevalent in international arbitration due to its cross border nature. For example, if one had delayed in seeking a freezing order or could not prove a dissipation of assets, the Hong Kong courts may deny relief. However, this is not a requirement in the PRC where a freezing injunction could be obtained without fulfilling those criteria.

In this episode of our Take 10 podcast, Asia Managing Partner Ian Mann and Partner Peter Ferrer discuss the case of Les Ambassadeurs Club Ltd v Yu.
Key takeaways:
Les Ambassadeurs Club Ltd vs Yu is an English court of appeal case involving the test for a freezing injunction.This is the second case Les Ambassadeurs Club has had to file against a customer.The case concerned what is meant by “real risk of dissipation of assets”. The decision made it clear that it was not helpful to apply any gloss to the test and that a probability test ought not to be applied.Every element within the test needs to be analysed thoroughly to ensure that relief is handed out where appropriate and that it is not overly used.

In this episode of our Take 10 podcast, Asia Managing Partner Ian Mann and Partner William Peake discuss the case involving Global Fidelity Bank and their involuntary liquidation.
Key takeaways:
Cayman Court appointed liquidators are officers of the Court; they must be professional insolvency practitioners; and they must act independently in the best interests of those with the economic interest in the liquidation (being the shareholders in a solvent liquidation and the creditors in an insolvent liquidation).The importance of the office holders entering into regular clear and transparent stakeholder communications.The identity of the practitioners being appointed is usually uncontroversial; most of the instances where a challenge is brought concern allegations of actual lack of independence. However apparent lack of independence is just as important. The Cayman Court is vigilant to ensure not only actual independence, but also the appearance of independence; not least because of the need to maintain confidence in those whom the Court appoints.Where a significant stakeholder objects to the appointment of proposed liquidators, the Court will give considerable weight to its views, if rational, held in good faith and on reasonable grounds; but no stakeholder can dictate who the Court should appoint.Where an objection is based on a prior involvement or relationship with the company in liquidation, the prior relationship or involvement may be an advantage in some cases, in terms of saving costs and time; in others, it may be a disqualification.In Re Global Fidelity Bank Ltd, in which Justice Doyle considers previous Cayman, English and Isle of Man decisions, and adopts the three stage test formulated in the 2013 Cayman case of Re Hadar Fund Ltd: This is that the Court must: (i) Identify the facts of the prior relationship or involvement; (ii) determine whether its existence is capable of impairing the appearance of independence and if so; and (iii) Determine if it is sufficiently material to the liquidation that a fair minded stakeholder would reasonably object to the appointment.In Re Global Fidelity Bank, the very limited prior involvement of the joint voluntary liquidators of the bank was held not to be a bar to their appointment by the Court (on which they took a neutral stance) as official liquidators under the Court ordered supervision of the voluntary liquidation (which was ordered on their petition) as neither stage (ii) or (iii) was satisfied.

In our ninth episode of this season’s Take 10 podcast, Asia Managing Partner Ian Mann interviews Victor Joffe QC about his extensive legal career including his aspirations as a law student, his role models, how he overcame challenges and lessons learned, as well as helpful advice to younger generations of legal practitioners.

Key Takeaways:

Victor was always interested in the law and originally planned to become a solicitor. When a tutor of his mentioned that being a barrister allowed for greater independence and the ability to “be your own boss,” Victor decided that a career path as a barrister was the right move for him.

Victor’s focus on company law was inspired by Gower & Davies: Principles of Modern Company Law. The book propelled him deeper into company law, developing particular expertise in unfair prejudice claims. Victor has also written a book on company law called Minority Shareholders: Law, Practice and Procedure and briefly taught company law and tax at the London School of Economics.

Victor’s mentors inspired him with their ability to clearly and logically express summaries of complex points and cases, as well as reinforcing the importance of being thoroughly prepared for court, being fearless in your clients' interests, to never give up even if the case doesn’t seem to be going your way, and to treat everyone with decency and respect.

When first starting out, it’s normal to be afraid when appearing in front of the judiciary and dealing with difficult judges, but with time and experience, practitioners will overcome this. The fear should never force you to cower at the expense of the client.

As a Silk, Victor would often visit Hong Kong for work. He loved the city and decided to move. The biggest difference is that he appears in court more often in Hong Kong than he did in the UK which has helped develop his practice significantly.

Victor’s key piece of advice to his younger self, and indeed to young practitioners today, is to achieve a good work-life balance and to be prepared for the unexpected.

On episode eight of this season’s Take 10 podcast, Partner Andrew Thorp is joined by Partner Peter Ferrer, Co-head of our global Litigation, Insolvency and Restructuring team, and Counsel Olga Osadchaya, a member of our Litigation and Insolvency practice in the BVI.

In this episode of our Take 10 podcast, BVI Head of Litigation, Insolvency and Restructuring Andrew Thorp is joined by partner Jonathan Addo to discuss the eagerly awaited Privy Council full board decision in Convoy Collateral Limited v Broad Idea International Limited which was handed down on 4 October 2021.

The Privy Council was asked to determine whether the Eastern Caribbean Court of Appeal was right in overturning the BVI Commercial Court’s 2010 Black Swan decision, where Justice Bannister held that he had power to grant a freezing order in support of foreign proceedings against a non cause of action defendant within the BVI Court’s jurisdiction. The 4-3 majority judgment given by Lord Leggatt confirms that Justice Bannister was correct and will now be the leading authority on interim injunctions.

Key takeaways

The majority judgment of the Board confirms that the wider dicta in The Siskina – that an injunction must be connected to the cause of action in substantive proceedings – is legally unsound. It puts to rest the undesirable impediment the case has had on the jurisprudence of interim injunction for the past 44 years.
In doing so, it upholds the BVI Court’s Black Swan jurisdiction, confirming that such common law equitable power to grant interim or freezing injunctions, whether standalone or not, exists, despite legislative development.
The majority judgment examines the purpose of a freezing injunction in the modern context, affirming it is to prevent the right of enforcement from being rendered ineffective by the dissipation of assets against which the judgment could otherwise be enforced, recognising the developments in international commerce since 1977.
The decision safeguards the standalone freezing injunction as an important cross-border asset tracing tool.