Post-judgment freezing injunctions and business expenses
26th September 2019 by Rob Kelly
Many businesses get involved with litigation and some may find themselves facing an order of the court to freeze their assets pending the outcome of a particular dispute. These ‘freezing orders’, which are often made before judgment, limit what businesses can do with their assets until the dispute has been resolved. Many pre-judgment freezing injunctions include a provision which allows a business to continue to trade and to deal with or dispose of their assets in the ordinary course of their business, despite the freezing injunction being in place. This is known as the ‘Angel Bell’ exception.
The Court of Appeal has recently drawn a distinction between pre-judgment and post-judgment freezing orders and upheld a decision of the lower courts to dis-apply the Angel Bell exception when a creditor has obtained a judgment which remains unsatisfied. The Court of Appeal deliberately avoided establishing a principle that the starting point in post-judgment applications for freezing orders should be that the Angel Bell exception is dis-applied, but it held that “it will sometimes and perhaps usually be inappropriate” to include the exception in a post-judgment freezing order.
If a business which is made subject to a post-judgment freezing order is not going to be able to deal with its assets in the ordinary course of its business, this means of enforcement has become more attractive to creditors as a consequence of this judgment.
If you would like any further information with regard post-judgment freezing injunctions please contact Rob Kelly on firstname.lastname@example.org or 01202 755980.