Defendant subject to freezing injunction ordered to disclose source of legal funding

Jonathan Scrine

In Barclay Pharmaceuticals Ltd v (1) Antoine Mekni (2) Martine Mekni (3) Dorian Mekni (4) Anice Mekni (5) Xiaohui Wang (unreported) [2017] the Claimant obtained judgment against D1 for over £15 million as a result of a fraud. Post judgment, the Claimant obtained a freezing order over D1’s assets and also joined various members of D1’s family who were said to be holding D1’s assets as nominees.

Under the terms of the freezing order, D1 was entitled to spend a reasonable sum on legal representation.

D1 had failed to make interim payments and failed to give full disclosure of assets. He had also failed to disclose the source of funding for his ongoing legal representation.

The Claimant applied for an order requiring D1 to disclose the source of his legal funding. The court considered whether it would be just and convenient to make the order to ensure that the injunction was effective.

The Court noted that D1 was a proven fraudster who had failed to pay anything towards the judgment debt and failed to disclose his assets. It would be easy for D1 to disclose the source of his legal funding and would cause D1 no prejudice. It was arguable that legal costs were being paid from assets that would be subject to the freezing order (and which had not yet been disclosed) and so the Court ordered D1 to disclose the source of funding.

Comment

This case demonstrates that even when a judgment is obtained and a freezing order is put in place, there may still be work to do to identify and enforce against assets. The court will assist claimants in trying to identify assets and sources of funding and the ultimate sanction will be a prison sentence if defendants fail to comply with court orders.

 

 

Post By Jonathan Scrine (2 Posts)

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