What Is A Freezing Order?

Date: August 23rd, 2017 - Written by: Brookman Solicitors

 

It is a type of injunction, and it does what it says. It ‘freezes’ assets so the owner cannot sell, use in a way that would undermine their value or otherwise dispose of them for a certain period of time.  These orders are extreme because they prevent individuals from using their property freely. Although not limited to family law they are of particular use in divorce and separation cases where one party believes the other may put marital assets beyond the other’s reach before finalising a comprehensive financial settlement.

 

What Is A Mareva Injunction?

Sometimes freezing orders are referred to as Mareva Injunctions. This was the name of one of the first cases to use such an order. They are essentially the same thing.

 

What Kind Of Property Can Be Frozen?

Everything from homes to bank accounts, to shares and jewellery can be made the subject of an order.  Orders may also apply to borrowed money and to money that your spouse has not yet received, for example a compensation lump sum or the proceeds of sale of a business or other asset. The order can apply to assets in the UK and abroad.

 

How Do I Get A Freezing Order?

As we have said this type of court order will significantly impact your spouse and possibly third parties. Expert legal advice is crucial to ensure you know you have a strong case. Do not end up paying avoidable court costs and the legal expenses of your spouse.

In cases of extreme urgency you can apply to court without informing your spouse. The order will only be granted if you can show:

  • You have a justifiable claim to the assets – an arguable case.
  • Your spouse really intends to deal with assets in a way that would ultimately reduce the amount available for division in your divorce settlement.
  • Objective facts to support your case. Simple suspicion is not enough.

 

In addition the order will not be granted unless it meets certain other criteria, including the following:

  • It should state whether the restrictions relate to worldwide assets or assets in England and Wales.
  • If applicable, there should be a statement explaining why no notice was given to your spouse about the hearing.
  • It should demonstrate that there will be sufficient funds for your husband or wife to meet legal, business and living expenses while the order is in operation.
  • You must undertake to pay damages to your spouse or any third party for any loss resulting from the order that the court considers should be compensated.

 

Can I Object To A Freezing Order?

Yes, but you should seek urgent legal advice.  Sometimes you will only become aware of the order when you are served with notice of it. Your spouse will have gone to court and proved he or she has a good, arguable case. Following that hearing the court will set another hearing date within a short space of time. At this hearing you can seek to persuade the court to lift the freezing order.

It is important to remember that the order is temporary. Nor should it prevent you from being able to meet your daily living expenses for example or run your business.

 

What Happens If My Spouse Ignores The Order?

When someone obtains a freezing order they should inform those institutions that have control of assets, for example banks or fund managers. Those bodies are then under a legal obligation to ensure compliance with the order. This means they must prevent, for example, withdrawal of funds by your spouse.

Your husband or wife is also under a personal obligation not to dispose of assets that are subject to the order but not controlled by a third party. If he or she ignores the order and sells property, he or she will face contempt of court proceedings and could face imprisonment.

 

When Will The Court Lift The Order?

It can do so at any time. But usually if the order is confirmed at the second hearing mentioned above, it will last at least until any financial order is finalized.

 

 

 

 

 

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