Service pages: commercial and corporate disputes

Beyond reach: High Court draws the line on non-party freezing orders

The English Court has power to grant wide-ranging and invasive freezing injunctions. But there are limits. Even where there exists a real risk of dissipation, a recent court decision shows that it is likely to be difficult to obtain a post-judgment freezing order over assets held by a third party based abroad. 

Background

So you bring a claim against an English company for payment of significant business loans.

You win and look to enforce that judgment. 

You discover that the company has received large sums of money which could not be accounted for in its financial statements and which had not been retained in its bank accounts. 

Moreover, it appears that payments had been made by the company to associated parties based abroad. There appears to be no proper purpose for those payments, and the recipients do not seek to justify or explain them or suggest that they provided any value in return for the same. 

Further still, you can show that there is a real risk that enforcement of your judgment will be frustrated by dissipation of the assets in question. 

Surely in those circumstances the English court would be willing to grant a freezing injunction against the assets of those foreign associates?

Well, in the recent case of Gilbert v Broadoak [2026] EWHC 153 that’s exactly what happened.

On a without notice application made by the successful claimant following judgment, the Court granted a freezing injunction over the assets of two non-parties that were related to the defendant and were based in Spain.

But when the matter came back before the court at the return date hearing, those foreign parties argued that the English court did not in fact have personal jurisdiction over them. 

The court agreed and the injunction against the Spanish respondents was discharged. 

Decision

Harsh? At first blush maybe, but a closer examination of the decision reveals a sound basis for this outcome. 

It is well established that the English Court can grant a freezing injunction over the assets of defendants to English proceedings. 

Based on the decision in TSB Private Bank International SA v Chabra [1992] 2 All ER, the English court can also grant a freezing injunction against parties that are not themselves defendants in the litigation. This applies to injunctions sought against such non-parties both before and after judgment is made in the proceedings. 

‘Chabra’ injunctions – as they are known – are often granted in circumstances where there is evidence that the foreign party is holding assets for the benefit of the defendant (although it is less well known that such injunctions can be put in place where the third party is merely accountable to the principal defendant for some debt or other receivable, claim or potential claim). As with any freezing injunction though, it will still be necessary in all cases to show that the assets of the third party are still at risk of dissipation. 

The application for an injunction must first be served on the non-party in question. And where they are based abroad it will be necessary to obtain the permission of the court to serve the application out of the jurisdiction. In turn, the applicant will need to show (among other things) that one or more of the jurisdictional gateways as set out in CPR PD 6B paragraph 3.1 is satisfied. 

In the Gilbert case, the claimant argued that five such gateways were satisfied. The Court disagreed on each occasion. In particular, the claimant relied on:

  • Gateway 2 which applies where ‘a claim is made for an injunction ordering the defendant to do or refrain from doing an act within the jurisdiction’. This was rejected by the Court: gateway 2 does not apply to an interim freezing injunction. The term ‘injunction’ in the rule refers only to an injunction sought as final, substantive relief.
  • Gateway 3 which applies where ‘a claim is made against the defendant on whom the claim form has been or will be served and – (a) there is between the claimant and the defendant a real issue which it is reasonable for the court to try; and (b) the claimant wishes to serve the claim form on another person who is a necessary or proper party to that claim’. This might have worked had the Chabra injunction been sought at the start of the proceedings. But here the claim against the defendant had already been tried and determined. The possibility that a common issue might arise at some point in future was held to be insufficient to invoke gateway 3.
  • Gateway 10 which applies where ‘a claim is made to enforce any judgment’. This was rejected on the basis that a freezing injunction is not enforcement of a judgment but merely a remedy to prevent the right of enforcement from being rendered ineffective by the dissipation of assets against which the judgment could otherwise be enforced.
  • Gateway 20 which applies where a claim was made ‘under an enactment which allows proceedings to be brought’ and those proceedings were not covered by any of the other gateways. The claimants argued that the application should pass through gateway 20 because it was a claim made under the Senior Courts Act 1981 s.37 which empowers the court to make interim or final injunctions. Again, this was rejected: the phrase “an enactment which allows proceedings to be brought” meant an enactment which established the procedural right to bring proceedings. The fact that a claim or application might be connected with or dependent in some way on an enactment – e.g. s37 – was not sufficient to engage gateway 20. 

On this basis it was held that the Court did not have jurisdiction over the Spanish non-parties. As such, the freezing order against them was discharged. 

The decision is understood to be under appeal.

Key takeaways

So a possibly surprising outcome, but the Court was clearly constrained by the limitations of the jurisdictional gateways in question. Indeed, it is notable that the Judge in the Gilbert case concluded as follows: “It may seem harsh that the Claimants have a good claim in principle to freezing relief against the Respondents…..but no apparent route to establish jurisdiction. However, as Foxton said in Commercial Bank of Dubai…., ‘if there is to be a general power to serve proceedings out of the jurisdiction to assist the enforcement of an English judgment debt, that is a matter for the Rules Committee’”.

Parties faced with cases involving assets by foreign non-parties may well wish to look for alternative ways in which to prevent dissipation. This may include seeking a Chabra injunction at the start of the litigation (in order to engage gateway 3) or even seeing if the facts support the Chabra respondent being added as a party to the claim (for example, on the basis of knowing receipt) and being made subject to a freezing injunction in the usual way.

Ultimately, timely and strategic action at the very outset can often prove decisive in preserving assets and safeguarding the integrity of a claim.

To learn more about our Commercial Disputes expertise and how we can help you, click here.

2026 ICC Arbitration Rules: Key changes

The 2026 ICC Arbitration Rules entered into force on 1 June 2026 and will apply to arbitrations commenced on or after that date. The amendments build on the previous 2021 Rules and reinforce the ICC’s focus on efficiency, procedural flexibility, transparency and cost-effectiveness. Whilst impactful, the changes do not fundamentally reshape ICC arbitration. Rather, they introduce targeted reforms designed to streamline proceedings in key areas, while preserving the procedural safeguards and institutional oversight that underpin the ICC’s global reputation. But what is the substance of the latest changes?

1. Terms of Reference no longer mandatory

Perhaps the most significant change in the 2026 Rules is the removal of mandatory Terms of Reference in standard arbitrations. Under the 2021 Rules, the Terms of Reference defined and limited the claims that could be advanced in the arbitration without the tribunal’s permission. They were required to be agreed at an early stage of the arbitration, within 30 days of the tribunal receiving the case file. The Terms of Reference were unpopular with some practitioners, who considered them time-consuming to agree and of limited use in practice. Their removal will bring the ICC into line with the other major arbitral institutions, none of which require terms of reference.

2. New cut-off for new claims

The first case management conference, which the tribunal must hold within 30 days of receiving the case file, will now assume a more significant role. Following the abolition of the Terms of Reference, the conference is now the cut-off point for the introduction of new claims without the tribunal’s permission. Parties thus remain required to set out their cases in full at an early stage.

3. New early determination mechanism

The Rules now expressly permit the tribunal to dispose of claims or defences at an early stage where they are manifestly either without merit or outside its jurisdiction. While tribunals arguably already possessed this power, the new rule resolves any doubt on the matter. The rule is intended to improve efficiency by avoiding time and money being spent on clearly unmeritorious cases. The change brings the ICC rules in line with other arbitral institutions, which have included similar provisions in recent revisions to their rules.

4. Expanded expedited and emergency procedures

The 2026 Rules contain a number of changes pushing parties towards faster and more streamlined proceedings where appropriate.

The threshold for automatic opt-in to the ICC’s expedited procedure, whereby disputes are generally determined by a sole arbitrator without an oral hearing, is increased to US$4 million, provided the arbitration agreement was concluded on or after 1 June 2026. 

In addition, the Rules introduce Highly Expedited Arbitration provisions as an additional opt-in mechanism for the most straightforward disputes. These provisions are based on the expedited procedure but are even more streamlined, for example, requiring the parties to submit their Statement of Claim or Defence alongside their Request for Arbitration or Answer.

The emergency arbitration provisions, which provide a mechanism for seeking urgent relief before the tribunal is constituted, have also been clarified and expanded. For example, ex parte (i.e., without notice) applications are now expressly permitted, catering for scenarios (for example, asset dissipation) where notice to the other party would frustrate the purpose of the application. Orders may now also be sought against “any party for which the President is satisfied, on a prima facie basis, that a binding arbitration agreement exists”, thereby expanding the regime to include parties who have become parties to the arbitration agreement alongside its original signatories.

5. Greater emphasis on disclosure, digital procedure and award management

The 2026 Rules modernise several aspects of the arbitral process. They reinforce disclosure obligations for arbitrators by expressly stating that any doubt should be resolved in favour of disclosure, while also clarifying that disclosure does not in itself establish a lack of independence or impartiality. Parties are additionally required at the outset to identify relevant persons and entities for conflict-checking purposes. 

More broadly, the Rules make electronic communications the default, support remote and hybrid hearings, allow digital award formalities and revise the framework for setting and extending the time limit for the final award. 

Conclusion

Overall, the 2026 ICC Arbitration Rules are evolutionary rather than revolutionary. They preserve the core structure of ICC arbitration while enhancing the ability of parties to resolve disputes efficiently, flexibly and proportionately in light of the issues and the value in dispute.

To learn more about Forsters’ arbitration expertise and how we can help you, please click here.

Illegality defence reaffirmed by the Supreme Court

featured image

It has long been established – ever since Lord Mansfield declared in Holman v Johnson (1775) 1 Cowp 341 that “no court will lend its aid to a man who founds his cause of action upon an immoral or an illegal action” – that illegality can bar civil claims under English law. 

That doctrine was reconsidered and reaffirmed this year by the Supreme Court in the exceptional (and very sad) case of Lewis‑Ranwell v G4S Health Services (UK) Ltd & Ors [2026] UKSC 2 in which the Supreme Court found that the claims Mr Lewis-Ranwell advanced in negligence and under the European Convention on Human Rights should be struck out owing to the illegality defence.

Background:

It is worth pausing to note that the facts giving rise to this Supreme Court judgment are deeply sad. 

Mr Lewis-Ranwell had been diagnosed with schizophrenia in his mid-twenties and had previously received psychiatric intensive care. In early February 2019, he was twice arrested and detained by the police on suspicion of burglary and assault. Whilst in custody, he behaved violently, appeared mentally unwell, and was seen by mental health practitioners. He was, nevertheless, released into the community without undergoing a mental health assessment on the morning of 10 February 2019.

On the day of his release, and in the course of a serious psychotic episode, Mr Lewis-Ranwell violently murdered three elderly men.

He was tried with murder and, during the course of his criminal trial, the Jury passed a note to the Judge saying “We, the Jury, have been concerned about the state of the psychiatric health service provision in our county of Devon. Can we be reassured that the failings in care for ALR will be appropriately addressed following this trial”. Ultimately, Mr Lewis-Ranwell was found not guilty of murder by reason of insanity. A hospital and restriction order followed to protect the public at large.

Mr Lewis-Ranwell later commenced civil proceedings, which were the subject of the Supreme Court’s judgment, in which he sought significant financial compensation from various parties (including G4S Health Services and Devon and Cornwall Police).

In short, Mr Lewis-Ranwell contended that the Defendants had caused him significant loss by negligently (and/or in breach of his human rights) failing to provide him with adequate care and by releasing him into the community and that, but for that negligence, he would have been admitted to hospital and the killings would not have occurred.

The Defendants denied the claims and certain of them applied for strike out on the basis that the claims were barred by the doctrine of illegality. 

The Supreme Court’s decision:

The Supreme Court, in contrast to the Court of Appeal, unanimously held that the illegality defence applied.

Although Mr Lewis-Ranwell had not been convicted of a crime (by reason of his insanity), the Supreme Court found that the threshold for the illegality defence to apply was met as he had killed the three men without lawful justification. His acts were not, on any view, trivial acts of unlawfulness capable of barring an otherwise legitimate claim.

Applying the policy-based considerations in Patel v Mirza [2016] UKSC 42; [2017] AC 467, the Supreme Court found that, even assuming the Defendants had acted negligently, the claim should not proceed.  

In applying the guidance in Patel v Mirza to the doctrine of illegality in the context of Mr Lewis-Ranwell‘s claim, the Supreme Court found that:

  • Allowing the claim to proceed could give rise to inconsistencies that would damage the integrity of the legal system; public confidence in the legal system would be undermined if a criminal court lawfully made a hospital and restriction order and the civil courts thereafter ordered payment of compensation for the consequences of that lawful detention;
  • Alternative procedures and forums, such as inquests and public inquiries, were better suited for the purpose of examining concerns like those expressed by the Jury at the criminal trial; and
  • Denying the claim was proportionate given the seriousness of Mr Lewis-Ranwell’s acts and their centrality to the heads of loss claimed. 

Takeaways for businesses 

Although the facts of Lewis-Ranwell are exceptional, the decision has wider significance. It serves as a clear reminder that the illegality defence remains a potent bar to civil recovery in appropriate cases. The Supreme Court emphasised that the defence is not limited to cases involving a criminal conviction, and that its application is not determined by formal classification alone. Rather, the court must ask whether allowing the claim would damage the coherence and integrity of the legal system by permitting compensation for loss arising out of serious unlawful conduct.

Homicide is thankfully not an issue most businesses face on a day-to-day basis. However, the principle that criminal conduct is not required for the illegality defence to apply is of wider application. The Supreme Court was clear that criminal responsibility is not required for the doctrine to be engaged. Rather, the question is whether the conduct at the core of the claim constitutes unlawful behaviour of sufficient seriousness. 

For businesses or individuals considering bringing legal proceedings to enforce rights or seek redress for any wrongdoing, it is worth carrying out a thorough investigation as early as possible to establish exactly what wrongdoing has occurred, and by whom. If there are questions about the conduct of those acting on behalf of a business or individual (for example, any agents or employee), such conduct could engage the doctrine of illegality. It is particularly worth keeping an eye out for fraud and bribery, particularly for businesses operating internationally. Whether the activity in question is sufficiently serious to prevent recovery will be highly fact-specific.

For businesses, ensuring that you have robust policies and procedures in place to promote compliance with law and regulation, together with clear reporting mechanisms, is likely to be the best way of preventing wrongdoing from occurring in the first place. Moreover, irrespective of any legal liability, businesses should be alive to the negative reputational consequences that often ensue whenever potential illegality is identified.