CAYMAN ISLANDS Law and Practice Contributed by: Alan Bercow, Jae Shin and Ross McLeod, Appleby
As service can be difficult, slow and cumber - some to serve in some jurisdictions, an order can be sought for substituted service where it is impracticable for any reason for personal ser - vice to be effected. Substituted service is service by other means – for example, 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). How - ever, the steps to effect service must not be contrary 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 impracticality 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 judgment, then enforcement steps can be tak - en 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 prop - erty. 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 equitable 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 5. Enforcement 5.1 Methods of Enforcement
the defendant from dissipating assets pend - ing enforcement. • Contempt proceedings – depending on the nature of the order, contempt proceedings may be commenced against the defend - ant, 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 – proceedings 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 Aus - tralian judgments) enforced by way of common- law enforcement. This involves issuing proceed - ings in the Cayman Islands based on the foreign judgment. The foreign judgment must be final and conclusive. A foreign judgment that is sub - ject to appeal in the foreign country 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 significantly following the case of Bandone v Sol Properties [2008] CILR 301, where the Cayman Islands court enforced a for - eign court’s order for specific performance of a contract for the transfer of shares by ordering rectification of the company’s Register of Mem - bers. 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.
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