CANADA Law and Practice Contributed by: John Pirie, Matthew Latella, David Gadsden and Christina Doria, Baker McKenzie
of the absent party against whom the injunction is sought. Such disclosure should include sufficient detail to allow the judge to determine the correct value of the underlying claim and the assets to be frozen. Certain jurisdictions have developed model Mareva orders, which serve as a guide when determining the appropriate parameters for this extraordinary relief. In a number of provinces, the ex parte order has a spe - cific shelf life (eg, ten days in Ontario), within which it must be renewed on an inter partes basis. Certain model Mareva orders include or permit asset disclosure terms, which can be a powerful tool to determine the scope of a defendant’s assets. There will often be a term that requires the defendant to deliver a sworn statement describing the nature, val - ue and location of assets, whether in their own name and whether solely or jointly owned. A further term can require the defendant to submit to examinations under oath on the sworn asset statement. Where these terms are granted, refusal to provide the asset information or submit to cross-examination may result in a finding of contempt of court. As mentioned, Mareva injunctions can be framed to freeze and obtain the disclosure of assets, both within Canada and on a worldwide basis. The Ontario Superior Court of Justice has provided for a world - wide Mareva injunction where the defendant had few assets in the jurisdiction. A key factor in granting the injunction was evidence based on information from Hong Kong lawyers that the Canadian order would assist in securing a freezing order in Hong Kong. In a recent decision, the British Columbia Court of Appeal found that courts can draw an adverse infer - ence to determine whether a defendant has exigible assets. The plaintiff obtained judgment against the defendant in an initial action before bringing a second action alleging that the defendants were trying to frus - trate the plaintiff’s ability to collect on the judgment. The plaintiff had obtained evidence that the defend - ant had withdrawn significant sums from his bank account following the judgment in the initial action and conducted an examination in aid of execution, during which the defendant testified that he had made various payments including to some unknown “credi -
tors”. The lower court initially granted a Mareva order in the context of the second action. However, the same court later set aside the Mareva order because it found no evidence that the defendant possessed any assets that could be restrained. The appellate court overturned the lower court’s decision, finding that the lower court erred in not drawing an adverse inference against the defendant based on the with - drawal of the funds and what the court deemed an “improbable story” told by the defendant during the examination in aid of execution. The appellate court did not remit the decision to the lower court because it held that the balance of interests favoured the plain - tiff. The appellate court ordered that the initial Mareva order be reinstated in updated form. Ontario courts have also recently granted Mareva injunctions freezing cryptocurrencies, signalling that digital assets are subject to execution and seizure to satisfy a judgment debt. Finally, while Mareva injunctions are typically sought before judgment, there is authority to grant a Mareva injunction after judgment. This can be useful in deter - mining the location of assets and securing assets in circumstances where a judgment debtor may seek to deplete, move or otherwise deal with the assets Where real property is at issue, an order for a CPL may be obtained. A CPL is designed to provide a notice of claim and a warning to the public that the property is subject to a court dispute. It has the practical effect of restraining dealings with the property (sale, financing, mortgaging, etc) while the litigation is pending. pending the outcome of an appeal. Certificates of pending litigation As a standalone pre-judgment remedy, a CPL can be made on a motion without notice, provided that the originating pleading includes a claim for the CPL with a proper description of the land in question. To obtain an order for a CPL, the moving party must first show that there is a triable issue in respect of the claim to an interest in the land. If this threshold test is met, the court will typically go on to consider a variety of
equitable factors, such as: • whether the land is unique;
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