The title Mareva Injunction officially dropped and replaced by the expression Freezing Order. However, the original name, Mareva Injunction is still loosely used. Mareva Injunction is an interlocutory injunction (temporary injunction) which is granted while the case is pending in court and before final judgement is given. Mareva Injunction is only ancillary to other proceedings which must have been commenced when it is granted. The grant of the Mareva Injunction is discretionary and depends upon the balance of convenience i.e. the court will weigh up the convenience to the plaintiff if the injunction is granted, against the detriment to the defendant if the injunction is granted.
Mareva Injunction will only be granted if the plaintiff is likely to recover judgement and the plaintiff can show that:
- Defendant has assets within the jurisdiction
- Defendant is intending to remove those assets in order to defeat the judgement which the plaintiff is likely to obtain (in reality, quite difficult for a plaintiff to show)
Thus, people observe that the Mareva Injunction is not freely applied. Plaintiff will not succeed in his application for a Mareva Injunction where it is obvious to the court that the assets which plaintiff wishes to freeze under the injunction are of no commercial value. If these assets would fetch no realistic sum of money to meet the plaintiff’s judgement but instead, by being the subject of a Mareva Injunction the defendant’s business would be embarrassed or prejudiced, then the application will fail. In a similar manner, if the defendant can show that assets are removed during the normal course of a business transaction, like money to satisfy another creditor, then the application to freeze this money will not be allowed.