CAYMAN ISLANDS Law and Practice Contributed by: Alan Bercow and Jae Shin, Appleby
4.2 Service of Proceedings out of the Jurisdiction The application is made supported by an affidavit setting out (among other things) the grounds of the application and the belief that the claimant has a good cause of action. The affidavit should also explain why the case is a proper one for service out of the jurisdic - tion. The application is usually made without notice to the defendants, and accordingly the applicant is under a duty of full and frank disclosure and fair pres - entation. As service can be difficult, slow and cumbersome to serve in some jurisdictions, an order can be sought for substituted service where it is impracticable for any reason for personal service to be effected. Sub - stituted service is service by other means – for exam - ple, by service on a lawyer or agent, by post, or by electronic means (see 2.8 Claims Against “Unknown” Fraudsters relating to service in the crypto context). However, the steps to effect service must not be con - trary to the law of the country in which they are to be taken. Delay of itself is unlikely to be a sufficient reason for an order for substituted service. However, significant delay coupled with prejudice to the efficient progress of the litigation can be incompatible with the due administration and hence satisfy the impractical - ity test ( Maples FS Limited v B&B Protector Services, PJSC National Bank Trust and PJSC Oktritie Financial Corporation [2022] 2 CILR 59). If a defendant fails to comply with an order or judg - ment, then enforcement steps can be taken by the claimant. In fraud cases, methods of enforcement include the following. • A charging order – this is an order where a charge is created over the debtor’s property, leading to a right to realise the charged property. A charging order over company shares is particularly effective in the Cayman Islands. • Appointment of a receiver – the court may appoint a receiver over a debtor’s assets by way of equita - 5. Enforcement 5.1 Methods of Enforcement
ble execution where it appears to the court just and convenient to do so. • A post-judgment freezing order – a freezing order can be made after judgment, preventing the defendant from dissipating assets pending enforcement. • Contempt proceedings – depending on the nature of the order, contempt proceedings may be com - menced against the defendant, which may result in the defendant being imprisoned, fined and/or having their assets sequestrated. • A garnishee order – this is an order requiring a party who owes money to the defendant to pay it to the claimant instead. • Winding-up or bankruptcy proceedings – proceed - ings can be issued to wind up a corporate debtor or for the bankruptcy of an individual debtor. 5.2 Enforcement of Foreign Judgments Foreign judgments are (save in the case of Australian judgments) enforced by way of common-law enforce - ment. This involves issuing proceedings in the Cay - man Islands based on the foreign judgment. The for - eign judgment must be final and conclusive. A foreign judgment that is subject to appeal in the foreign coun - try may still be final and conclusive. Traditionally, a foreign judgment could only be enforced if it was for a debt as described in 5.1 Methods of Enforcement ; however, this area of law changed sig - nificantly following the case of Bandone v Sol Prop- erties [2008] CILR 301, where the Cayman Islands court enforced a foreign court’s order for specific performance of a contract for the transfer of shares by ordering rectification of the company’s Register of Members. The court case confirmed that the direct enforcement of foreign judgments should no longer be confined to those for a debt or specific sum of money; non-money judgments may now be recognised and enforced by way of equitable remedies. A defendant may seek to challenge the authority of or basis for the foreign judgment on the following limited grounds: • the foreign judgment was obtained by fraud, either on the part of the court or the opposing party;
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