CAYMAN ISLANDS Law and Practice Contributed by: Sam Dawson, Peter Sherwood and Denis Olarou, Carey Olsen
5.6 Rules Disallowing Disclosure of a Document
granted ex parte, the respondent will have an oppor- tunity to challenge the order at an inter partes hearing. Whenever injunctive relief is granted ex parte the applicant is under the strict duty of full and frank dis- closure to the court. This is an obligation to disclose to the court fully and fairly all matters, whether factual or legal, that are material to the applicant’s position (including adverse matters). Failure to give full and frank disclosure at the ex parte hearing may lead to the injunction being discharged inter partes regardless of the substantive merits. 6.4 Liability for Damages for the Applicant It is a condition of obtaining a freezing injunction that the applicant must undertake to compensate any losses suffered by the respondent if it is later ruled that the injunction should not have been made. In certain circumstances, the court may order for this undertaking to be fortified by the applicant providing security. In any event, the applicant should expect to have to disclose to the court information relevant to its ability to honour the undertaking in damages. 6.5 Respondent’s Worldwide Assets and Injunctive Relief Injunctive relief is available against the assets of the respondent both in the Cayman Islands and world- wide. A worldwide freezing order may be granted where the value of the respondent’s assets in the Cayman Islands is unlikely to meet the value of the applicant’s claim. However, the court will often require the appli- cant to come back to obtain permission before enforc- ing the freezing order in a foreign jurisdiction. 6.6 Third Parties and Injunctive Relief A freezing order may be effective against third parties, depending on its terms. For example, an “extended definition” freezing order, which encompasses the respondent’s assets held on its behalf by third parties. Moreover, third parties who knowingly assist the respondent in violating the freezing injunction will be in breach of the freezing injunction.
A party is not required to disclose a document if it would tend to incriminate that party or if disclosure of the document would be detrimental to the public interest. 6. Injunctive Relief 6.1 Circumstances of Injunctive Relief A wide variety of injunctive relief may be obtained from the Cayman Islands courts, including the following. • Freezing orders (both domestic and worldwide) are available, both in aid of proceedings in the Cayman Islands and in aid of foreign court and arbitration proceedings. A freezing order restricts a party’s ability to deal with its own assets in order to prevent the improper dissipation of those assets before judgment, and it is usually coupled with an asset disclosure order to help the plaintiff identify the respondent’s assets and police the freezing order. • Prohibitory and mandatory interim injunctions, including proprietary injunctions, are likewise avail- able. Prohibitory injunctions restrain a party from taking a particular step, whereas mandatory injunc- tions require it to take specific action. • Anti-suit injunctions, which restrain foreign legal proceedings, may be obtained. In certain circumstances, injunctive relief may be granted without notice to the respondent. However, the respondent always has a right to have the matter heard inter partes at the earliest convenient date. 6.2 Arrangements for Obtaining Urgent Injunctive Relief If the urgency is genuine and properly explained to the court, an application for injunctive relief may be heard and granted the same day. 6.3 Availability of Injunctive Relief on an Ex Parte Basis Injunctive relief is available on an ex parte basis. Indeed, this is the usual basis on which freezing injunctions are granted. However, once the relief is
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