CAYMAN ISLANDS Law and Practice Contributed by: Guy Manning, Harry Shaw and Shaun Tracey, Campbells
To place this in context, the litigation landscape includes major substantive claims pursued by writ action in the specialist Financial Services Division of the Grand Court and the Cayman Islands Court of Appeal. For example, in recent years the Cayman Islands courts have heard an approximately USD2 bil - lion claim brought by a Madoff feeder fund against its custodian/administrator (the “ Primeo litigation ) and an approximately USD9 billion fraud claim involving a series of Cayman Islands companies connected to Saudi Arabia (the “ Saad litigation ”). The Financial Services Division also hears all insol - vency proceedings in respect of Cayman Islands companies and exempted limited partnerships, which are typically investment vehicles for hedge fund and private equity structures. The primary available relief is a winding-up order placing a company into official liquidation and appointing liquidators (although, if the grounds for a just and equitable winding-up are estab - lished, the court may, in its discretion, grant alternative remedies). If the company is wound up, the compa - ny’s liquidation will be supervised by the court, which will, for example, determine applications brought by the liquidators for sanction to exercise certain powers, such as their power of sale of the company’s assets. The Cayman Islands also has a modern and well- developed restructuring regime, which provides a means for a distressed company to seek protection from creditor claims while court-appointed provi - sional liquidators or restructuring officers promote (or supervise the directors in promoting) a compromise or arrangement with creditors. Another notable stream of Cayman Islands litigation concerns the statutory merger regime, pursuant to Section 238 of the Companies Act. In summary, this regime permits a dissenting shareholder to seek “fair value” for its shares rather than receive the price oth - erwise payable under the merger agreement. Such liti - gation is heavily contested, involving expert evidence as to the value of the shares in question, and it will result in a judgment according to the court’s findings about the fair value of those shares. The courts also have jurisdiction to grant a variety of free-standing interlocutory relief in certain cases, such
as freezing orders in aid of foreign proceedings and anti-suit injunctions to restrain foreign proceedings brought vexatiously or in breach of contract. Finally, the courts will determine the costs of the pro - ceedings, generally on the basis that the loser will pay the winner’s costs. Costs are taxed (assessed), if not agreed, following the conclusion of the proceedings. 2.2 Enforcement of Domestic Judgments A Cayman Islands judgment may be enforced within the jurisdiction by various means, having regard to the nature of the judgment and relief. Domestic judgments are enforceable in the Cayman Islands within six years of their delivery. A judgment for the payment of money may be enforced by: • a writ of fieri facias (a writ of execution leading to an order directing the court bailiff to seize assets in order to satisfy the judgment debt); • garnishee proceedings (where the court directs a third party that owes money to the judgment debtor to pay the judgment creditor instead); • a charging order over land or other assets; • an attachment of earnings order (redirecting a por - tion of the judgment debtor’s wages to the judg - ment creditor); • a writ of sequestration (a general seizure of prop - erty); • the appointment of a receiver; and/or • committal for contempt. Failure to satisfy a money judgment also provides grounds for the judgment creditor to bring insolvency proceedings against the judgment debtor. A judgment for the possession of land or the delivery of goods may be enforced by a writ of possession or delivery of goods, an order for committal and/or a writ of sequestration. A judgment requiring a person to perform or refrain from performing any act may ultimately be enforced by a writ of sequestration, including against the prop - erty of any director or other officer of a corporate judg - ment debtor. Committal for contempt is also possible,
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