Frozen Assets v Business As Usual: Where to Draw the Line

04 Mar 2019

Michael Wilson & “Partners” Ltd v Emmott [2019] EWCA Civ 219

26 February

When is it appropriate to apply the Angel Bell exception to a freezing injunction, thereby permitting some of the otherwise frozen assets to be used in the ordinary course of business? Does it matter whether the injunction is granted pre- or post-judgment?


On 5 September 2014, a London arbitral tribunal made an award in favour of the Respondent, Mr Emmott, in the sum of  £3.2 million and US$841,000.  The Appellant, Michael Wilson & Partners Ltd (‘MWP’) challenged the award in the English courts and refused to honour the award.

To aid enforcement, Mr Emmott applied for a Mareva injunction, now commonly known as a ‘freezing’ order, which was granted on 5 December 2014.  The order prohibited MWP from removing from England and Wales any of its assets within the jurisdiction up to the value of £3,909,613 plus US$841, 213; and disposing of, dealing with or diminishing the value of any assets, irrespective of location, up to the same value.  Exceptions, however, were made, including for dealings or dispositions in the ordinary and proper course of business in the standard form known as the Angel Bell exception.

On 26 June 2015, MWP’s challenges to the arbitral award were dismissed and Mr Emmott was given leave to enforce the award in the same manner as a judgment or order of the court. Judgment was entered against MWP in the terms of the award, and an application for a stay on enforcement was dismissed.  Applications to appeal were filed and refused, and the Supreme Court finally shut down all possibility of challenge on the award by refusing MWP’s petition on 19 May 2016.

Throughout this time, the freezing order of 2014 had remained in force. By a judgment and order dated 13 July 2017, its terms were varied so as to remove the Angel Bell exception.  The Appellant appealed its removal on the grounds, in summary, that:

  1. The judge had erred in law in holding that the starting point for a post-judgment Mareva injunction is that the exception is removed; rather, removal should be a last resort;
  2. The removal did not serve the legitimate purpose of a post-judgment Mareva injunction to aid execution, but, rather, the effect of removal was to impose the order in terrorem.

The Court of Appeal

The Court considered the development of the Mareva jurisdiction, and noted that the authorities showed some uncertainty as to whether the Angel Bell exception is appropriate in post-judgment Mareva injunctions.

The Court of Appeal summarised the correct legal position as follows:

  1. Post-judgment Mareva injunctions can no longer be described as rare and are granted to facilitate execution by guarding against a risk of dissipation that would ultimately leave the judgment unsatisfied. Whether pre-or post-judgment, a Mareva injunction is not intended to confer a preference in insolvency and does not form a part of execution itself.
  2. A post-judgment Mareva will realistically increase the pressure on a defendant to honour a judgment debt, but such increase in pressure does not make it illegitimate or “in terrorem”.
  3. It cannot be said that, without more, the Angel Bell exception would be inappropriate in a post-judgment Mareva (emphases in the original).
  4. It can be said, however, that “it will sometimes and perhaps usually be inappropriate” to include the exception in a post-judgment Mareva injunction (emphasis original). It would be against the policy of the law, strongly in favour of the enforcement of judgments, if a judgment debtor were free to carry on business and ignore the outstanding judgment.
  5. Nevertheless, it would be preferable not to characterise refusal of the exception in a post-judgment Mareva as a ‘starting point,’ ‘presumption,’ or conversely a ‘remedy of last resort.’ Instead, the appropriateness or otherwise of the exception in should be treated as a question turning on all the facts in the individual case.


This case helpfully clarifies the nature and purpose of what are now commonly known as ‘freezing’ injunctions. Practitioners should keep such clarification in mind when making applications for such orders, given the clear indication that courts must consider whether the application accords with the purpose underlying the grant of such relief. Furthermore, the authoritative statement that Angel Bell exceptions are to be considered against all the facts in an individual case serves as a broader reminder that hard and fast tests for the grant of equitable relief remain rare.

Nevertheless, the Court of Appeal has made clear that there is ‘no doubt’ that an unsatisfied judgment debt is factually distinct from a pre-judgment claim for damages. Absent, therefore, some compelling individual facts of a case, it would, ‘perhaps usually’ be appropriate to remove the Angel Bell exception where the freezing order is obtained post-judgment to aid execution. The decision to grant such relief, however, will remain discretionary and reached on a fact specific basis.


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