Lowry Trading Limited & Anor v Musicalize Ltd & Ors (No 2)
[2024] EWHC 773 (Comm)
CRO v REC & Anor
3 February 2023
[2023] EWHC 189 (Comm)
High Court
A court order froze someone's assets but let them spend some on lawyers. The question was whether they had to say *how much* they spent on lawyers, not just where the money came from. The judge said no, because the order didn't clearly say so, and there are already ways to check if they're spending too much.
Key Facts
- •A standard form freezing order, including the Source Proviso, was issued.
- •The dispute concerned whether the order required the respondent to disclose the amount spent on legal expenses, in addition to the source of the funds.
Legal Principles
An order must be expressed in unambiguous language; an unclear order cannot support contempt proceedings.
Gee, Commercial Injunctions (7th)
Freezing orders should be given a purposive construction, but this is limited; efficacy for one party does not automatically justify a particular interpretation.
Judgement
A respondent is entitled to defend themselves and spend frozen funds on legal representation, but this is limited to a reasonable sum.
Tidewater Marine International Inc v Phoenixtide Nigeria Limited [2015] EWHC 2748 (Comm)
The legal expenses proviso primarily ensures the respondent can defend the proceedings at hand, not all litigation.
Tidewater Marine International Inc v Phoenixtide Nigeria Limited [2015] EWHC 2748 (Comm); Sundt Wrigley Co Ltd v Wrigley
Solicitors are officers of the court and should not permit clients to incur plainly unreasonable costs; this provides a check on excessive expenditure.
Anglo-Eastern Trust Ltd v Kermanshahehi [2002] EWHC 3152
Outcomes
The freezing order does not oblige the respondent to notify the applicant of the amount spent on legal expenses.
The standard form wording, even with the Source Proviso, does not expressly require disclosure of the amount spent. Such a requirement would be highly invasive and lacks clear textual support. Existing mechanisms, such as cost budgeting and solicitor oversight, provide sufficient control.