The Commercial Court's important decision in Commercial Bank of Dubai v Abdalla Juma Majid Al-Sari has confirmed that the BVI courts have jurisdiction to grant charging orders.
Justice Adderley has now handed down his full judgment in Commercial Bank of Dubai.
Adderley largely agreed with and followed submissions on the bank's behalf in finding that there had been a statutory basis for the granting of charging orders in England before 1940, which meant that such jurisdiction vested in the BVI courts by virtue of Section 7 of the Eastern Caribbean Supreme Court Act 1969.
The judgment reaffirms that Adderley's decision in Stichting Nems v Gitlin was made per incuriam insofar as he concluded in that case that the BVI courts had no jurisdiction to grant charging orders. Adderley also helpfully restated the principles that guide the court in exercising its discretion as to whether a provisional charging order should be made final.
Charging orders are a critically important tool, particularly when enforcing foreign judgments, as they allow creditors to take a proprietary interest over assets owned by a debtor and can ultimately facilitate the sale of such assets in order to allow the creditor to realise their debt. Therefore, Commercial Bank of Dubai should be welcomed, as it avoids the need for the legislature to step in and fill what would otherwise have been a significant lacuna in BVI law.
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