The judgment clearly states that Mr Justice Mostyn’s decision in UL v BK  is the determinative judgment which the Court must follow when deciding whether or not to grant a freezing injunction in a family law matter. UL v BK provides clear guidance as to the:
In this article, we examine the decision in J v H and Mr Justice Peel’s comments on what is required in order for a court to grant a freezing order.
The background to the decision
The facts of J v H are straightforward. The parties’, both Pakistani nationals, relocated to England on the wife’s Investor Visa. The husband worked in banking and the wife came from a wealthy family and worked in the family business.
There was no indication that the wife was secretive about her wealth, which her husband estimated to be around £15 million, held in the UK and overseas. At the Court’s direction, the wife stated in writing that her wealth amounted to about £5 million with a further £2 million worth of assets held under legal title in her name but beneficially owned by her father. The Wife’s investor visa was reduced to £1,7 due to the volatile markets.
The marriage broke down shortly after and the parties’ separated. The husband issued divorce proceedings in England and Wales. Prior to the parties’ separation the Wife withdraw £32,000 from a joint bank account, with the Husband’s knowledge. The Wife then further withdrew USD $18,000. The Husband initially sought an undertaking from the wife that she would not dispose of any world-wide assets in her name. The Wife explained the transactions of £32,000 and USD $18,000 respectively in correspondence, albeit on different occasions and confirmed that she would return the USD $18.000. The Wifedid not agree to the undertaking,, The husband applied for a freezing injunction on short notice.
The Court’s decision
Regarding the robustness of the freezing order application, Mr Justice Peel stated that:
“…I am of the view that the evidential justification for H’s application is thin. There is little in terms of objective evidence to indicate a solid risk of dissipation of assets. Mere suspicion, or anxiety, on H’s part is not sufficient. I am not satisfied that there is any basis upon which to assert that W by her actions was and is seeking to defeat H’s financial claims.”
The Judge then went on to quote Mr Justice Mostyn’s serious concerns regarding ex-parte (without notice) injunction applications:
“Finally, I draw attention to the great concern of myself and other judges at the continued widespread abuse of the principles governing ex parte applications not only for freezing orders but also more generally. It is worth remembering not only that the ex parte procedure is intrinsically unfair but also, and very importantly, that a case which begins with an ex parte order is usually poisoned from that point onwards. The unilateral step taken at the beginning of case echoes down its history. Often the respondent is enraged by the step taken against him and looks to take counter-offensive measures. Every single subsequent step is coloured by that fateful first step. Costs tend to mount exponentially. And even after the lawyers close their files and render their final bills the personal relations of the spouses will likely remain forever soured”.
In UL v BK, Mr Justice Mostyn set out that the Court has the power to make a freezing order if the following conditions are present:
In J v H Mr Justice Peel applied the principles set out in UL v BK and dismissed the husband’s application for a freezing injunction on the basis that:
J v H confirmed that the decision in UL v BK sets out the relevant principles and safeguards when applying for a freezing injunction, including that applications for freezing injunctions must be supported by affidavit evidence (pursuant to PD21A para 3.1 of the FR). Furthermore, any draft orders or proposals to freeze assets must ensure that no economic paralysis is suffered by the Respondent or a third party and that reasonable provisions are made to cover the costs of living or any school fees.
In addition, Mr Justice Peel’s comments when giving his decision in J v H confirms that the Courts remain extremely wary of granting ex-parte freezing orders because of the disastrous impact they can have on the Respondent and third parties. Therefore, to have any chance of obtaining such an order, not only must the application be made with strict procedural accuracy, but robust evidence that complies with the principles set out in UL v BK must be provided.
In addition, there must be strong grounds for an application – mere suspicion is not enough.