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14 August 2018
On 1 June 2018 the Singapore Court of Appeal ruled to reinstate and expand a Mareva injunction against fraudster defendants in a conspiracy claim, providing strong support for an earlier decision of the BVI Commercial Court in related proceedings (for further details please see "Freezing injunction: what is a good arguable case?").
JTrust claimed that the defendants had conspired to defraud it by falsely inflating the performance of the entity in which it was investing and had conspired to misappropriate those investments by making sham loans to fraudulent borrowers.
Two days before the ex parte injunction was obtained in Singapore, the BVI Commercial Court granted a worldwide freezing injunction against one of the defendants and his BVI company, the conduit of the fraud. The defendants also sought to discharge the injunction but the BVI court refused, holding that it would be "extraordinary" not to continue it in the circumstances. JTrust had established a good arguable case and a serious risk of dissipation and the defendant was "a sophisticated businessman with a network of companies" and with "untrustworthy characteristics" who could "move assets quickly".
In a decision that echoed the findings of the BVI Commerical Court, the Singapore Court of Appeal reinstated the Mareva injunctions and even expanded them worldwide against two of the defendants.
The decision demonstrates the importance of consistency between courts in multiple jurisdictions in complex cross-border cases. The Judicial Insolvency Network Guidelines, which (although not used in this case) have been adopted in Singapore and the British Virgin Islands, can be extremely beneficial (for further details please see "Guidelines adopted for communication and cooperation between courts"). The guidelines act as a framework setting out best practice for facilitating cooperation and communication between courts.
For further information on this topic please contact Ian Mann, James Noble or Jennifer White at Harneys' Hong Kong office by telephone (+852 5806 7800) or email (firstname.lastname@example.org, email@example.com or firstname.lastname@example.org). Alternatively, contact Peter Ferrer at Harneys' Tortola office by telephone (+1 284 494 2233) or email (email@example.com). The Harneys website can be accessed at www.harneys.com.
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