Certain contracts will not be formed until a condition precedent has been fulfilled (see further below). Terms of an offer may also be incorporated by reference to a set of standalone terms and conditions, a statute or even another contract. In any event, the offeree must be informed and must be given the reasonable opportunity to gain knowledge of those incorporated terms. In the case of incorporation of a statute, the incorporation of the statute can be limited to the wording the statute included at the time of incorporation in the contract or being subject to any changes brought later to the wording of that statute. _________________________ 7 [2016] EWCA Civ 372 8 Chitty on Contract, 32nd Edition, Part 2, Chapter 2.
In terms of acceptance, one interesting issue of the formation of English law contract is whether acceptance of a contract can be made by way of silence. This issue has arisen in the context of litigation, but also arbitration. As a general rale, someone who does nothing in response to an offer is not bound by its terms even if the offer provides that the offer may be accepted by silence9. There can be exceptional circumstances where the court will depart from the general rule about silence, e.g. where the person claiming that he did not accept the offer was the one soliciting the offer10 or where offers to buy goods in the past were accepted by the mere dispatch of the goods and without any notice of rejection11. A party may have also stipulated that if rejection was not expressed within a certain time, then the offer was to be taken as accepted12.
III. A commercial approach to interpretation of contracts and terms of the contract (warranties, conditions and intermediate terms)
Once a contract is formed in English law, it is often the subject of subsequent interpretation and many a dispute arises between parties with regard to the meaning of the terms they have agreed. In English law, a contract would contain express terms but may also contain implied terms which define the extent of the rights and obligations of the parties. When dealing with the meaning of contract terms, the Court follow rigorous rales of interpretation and will not depart from the clear meaning of words as a starting rale. The primary source of interpretation is the conventional usage of the words13. Only when, on the face of the contract, the meaning of the words is uncertain or does not accord with what a reasonable business person would have intended objectively to mean, the court will interpret the contract in accordance with business common sense14. Lord Hoffmann in the authoritative case of Investors Compensation Scheme v West Bromwich Building Society15 established the modern approach of the court's interpretation of contract when he decided that the court must determine «the meaning which the document would convey to a reasonable person having all the background knowledge which would reasonably have been available to the parties in the situation in which they were at the time of the contract»16. _________________________ 9 Felthouse v Bindley 142 E.R. 1037 (1862); Linnett v Halliwells LLP [2009] 1 C.L.C. 157 in a case of adjudication where a party having participated in an adjudication process successfully rejected a claim for payment of the adjudicator's fees because it did not respond to the adjudicator's invitation to agree his terms and conditions. 10 Rust v Abbey Life Ins. Co [1979] 2 Lloyd's Rep. 335. 11 Cole-Mclntyre-Norfleet Co v Holloway 141 Tenn. 679, 214 S.W. 87 (1919), referred to in Chitty on Contract, 32nd Edition, Part 2, Chapter 2. 12 Re Selectmove [1995] 1 W.L.R. 474, 478. 13 Bank of Credit and Commerce International SA v. Munawar Ali, Sultana Runi Khan and Others [2001] UKUL& 14 Antaios Compania SA v SalenAB (TheAntaios) [1985] AC 191 15 [1998] 1 W.L.R. 896 HL
From then on, the judges have been increasingly 'cavalier' with the application of those principles prioritising commercial sense, it would seem, over the natural meaning of the words (even when ambiguity of the meaning of the words was difficult to see). In addition, some cases suggest that judges would, at times, reach out to the very wide factual context of a case when deciding on the true construction of a contract. In the case of Rainy Sky v Kookmin Bank17, the judges were faced with two alternative constructions of a clause which were both viable, as neither of them led to an absurd result. The judges chose the most commercial option. When deciding, Lord Clarke stated that if «there are two possible constructions, the court is entitled to prefer the construction which is consistent with business common sense and to reject the other»18. While the decision was reached in accordance to the rule that the words must be ambiguous to do so, some scholars question whether by choosing the more commercial option for construction, the judges failed to take into account the factual matrix of the case19. Lately, however, the courts sensed the danger that judges would use this modern commercial approach to the detriment of the natural and unambiguous meaning of the words and the actual factual context. The recent case from the Supreme Court of Arnold v Britton is a good reminder of this rule20. Although English law has developed to give more of a commercial sense to contracts in order to ascertain the true intention of the parties, the factual matrix remains important. To support this point, Lord Neuberger in Arnold v Britton stated that: «reliance placed in some cases on commercial common sense and surrounding circumstances (eg in Chartbrook [2009] AC 1101 , paras 16-26) should not be invoked to undervalue the importance of the language of the provision which is to be construed. The exercise of interpreting a provision involves identifying what the parties meant through the eyes of a reasonable reader, and, save perhaps in a very unusual case, that meaning is most obviously to be gleaned from the language of the provision. ____________________________ 16 Ibid, at p. 912. 17 [2011] UKSC 50 18 Ibid, at [21] 19 Adam Shaw-Mellors and Laura Stockin Contractual interpretation and commercial common sense: setting the limits. - P.C.B., 2015. - 5. - 268-274; Paul Davies Interpreting Commercial Contracts: ACase of Ambiguity? 2012. - L.M.C.L.Q. - 26, 27 20 [2015] UKSC 36
Unlike commercial common sense and the surrounding circumstances, the parties have control over the language they use in a contract. And, again save perhaps in a very unusual case, the parties must have been specifically focussing on the issue covered by the provision when agreeing the wording of that provision.»21 He further stated: while «commercial common sense is a very important factor to take into account when interpreting a contract, a court should be very slow to reject the natural meaning of a provision as correct simply because it appears to be a very imprudent term for one of the parties to have agreed, even ignoring the benefit of wisdom of hindsight.»22 When construing contracts, the courts will also take into consideration a second interpretation principle: the contra proferentem principle. Where there is doubt about the meaning of words in a contract, the words are construed against the party who invokes them. The purpose of this principle is to prevent the party who drafted the provision or the contract to benefit from its operation in cases where ambiguity arises and there is a dispute about the meaning of the ambiguous words. Derived from the contra proferentem principle, there is the exclusion rule, of similar concept but applying to terms of a contract which seek to exclude certain obligations of a party. Those exclusion clauses are often encountered in commercial contract where a party seeks to limit the amount or nature of the other party's recoverable losses or seeks to limit an obligation or a right of a party within a specific timeframe. Recent case law on exclusion clauses have again stressed that the starting point must be ambiguity as to the meaning of the relevant contractual provision so to allow an interpretation which departs from a literal reading of the words23. When dealing with the evidence admissible to interpret and construe the meaning of ambiguous words, the courts should not take into account pre-contractual negotiations24. Pre-contractual negotiations can be admissible, however, when the courts are being asked to rectify a contract which is not the same than construction and interpretation of contracts. The doctrine of rectification is an equitable doctrine which allows the court to correct a mistake in written contracts. ____________________________ 21 Ibid, at [17] 22 Ibid, at [20] 23 In Transocean Drilling U.K. Ltd v Providence Resources Pic, supra, the Court of Appeal, allowing for the exclusion of liability for consequential losses under the contract held that the first instance judge had been wrong to consider the clause in the light of the contra proferentem principle that dictates that the clause should be read against the person who put the clause forward as there was no doubt about the meaning of the clause; Hut Group Ltd v Nobahar-Cookson [2016] EWCA Civ 128 (CA(Civ Div)) 24 Prenn v Simmonds [1971] 1 WLR 1381 , 1384
The difference, there, is that the words are not interpreted to give an objective interpretation of the contract. Instead, the parties have made a common mistake in the choice of words which do not reflect what the parties intended to mean and the court can apply the equitable doctrine of rectification to correct it25.
IV. Performance and discharge by breach of the contract
Performance, partial performance Contracts are normally discharged when the obligations the parties agreed to fulfil are fulfilled but they can also be discharged by way of a breach or an agreement by the parties releasing one another from their respective rights and obligations or by frustration26. Those concepts are similar to ones that can be found in other jurisdictions and this article does not purport to describe performance in depth. An interesting feature of English law is how the court have dealt with partial performance of obligations. Over time, judges realised that parties not being entitled to some relief for a partial performance of their obligations could lead to unfair results. Thanks to the principles of equity, a party who has performed his obligations in part may still recover for the part that party has performed if what the party failed to perform is minimal (the principle of de minimis поп curat lex, «the law is not concerned with trivial matters»). If a buyer, for example, accepts part of a delivery and does not reject the goods, the buyer may have impliedly agreed to pay a reasonable sum for the partial goods. When it comes to failing to perform the obligations of the contract as a whole, there are other rules which applies and case law refined the consequences of such non-performance of the contract, notably in the case of breach. Conditions, warranties and intermediate terms - consequences of breach As a general principle, there are three types of express contract terms27 in English law which if breached lead to different remedies. A breach of a term of the contract will normally give rise to a claim of damages for losses suffered. ____________________________ 25 Chartbrook Ltd and another v Persimmon Homes Ltd and another [2009] UKHL 38 26 This means that the contract cannot be performed because the object of the contract does not exist anymore. 27 English law also allow for implied terms which can be implied as a matter of fact by the Court when the term satisfies the test of «business necessity», (see Att-Gen of Belize v Belize Telecom Ltd [2009] UKPC 10; Marks & Spencer Pic v BNP Paribas Securities Services Trust Co (Jersey) Ltd [2015] UKSC 72); an implied term may also be implied as a matter of law.
Important terms of the contract, conditions of the contract, may also give rise to a right to terminate said contract. Conditions can be conditions precedent, conditions concurrent or conditions subsequent. There are terms which subject the obligations of one or both parties to a condition which much arise before, at the same time or after an obligation in order for the contract to become or to continue to be binding. On the other hand terms which do not impact or relate to the main obligations of the contract directly (warranties) would not normally give rise to termination rights. Warranties are more like contractual undertakings but, as contract terms, they are those which give rise to a claim for damages but not to a right to treat the contract as repudiated, i.e. as terminated by the breach of the other party's obligations28. There exist terms which are neither warranties nor conditions but depending on whether they go to the root of the contract or not could also give rise to a right to terminate a contract. Those are called intermediate or innominate terms and the consequences of their breach is dependent on the nature of that breach. Those are complex terms which require to be assessed by the court on the facts. The Court of Appeal in Hongkong Fir Shipping Co Ltd v Kawasaki Kisen Kaisha Ltd described them as terms the legal consequences of which, «unless provided for expressly in the contract, depend upon the nature of the event to which the breach gives rise and do not follow automatically from a prior classification of the undertaking, as a 'condition'or a 'warranty'»29. When a party has a right to terminate, it can elect to do so, i.e. not fulfil its obligations or it can affirm the contract which means the party has chosen to continue to perform its obligations under the contract. Once this choice of affirmation is taken by a party and the other party has been told, the choice becomes irrevocable30. At the same time, a party cannot wait too long before using its right to terminate31. In order to ensure that the other party benefits from a certain certainty in knowing what is legal position is, a party who takes too long to exercise the right to terminate may lose that right. Even when a contract includes a clause which provides that delay in enforcing a provision cannot amount to a waiver, the court may still find that the non-waiver provision is not effective and a party has lost the right to terminate. In Tele2 International Card Company v Post Office Limited32, the court found that the party had continued to perform its obligations for a year without protesting that the other side was not performing its own obligations so that it had lost its rights to terminate. ____________________________ 28 Hongkong Fir Shipping Co Ltd v Kawasaki Kisen Kaisha Ltd [1962] 2 Q.B. 26, 70 29 [1962] 2 Q.B. 26 at 70 (Lord Diplock, then Diplock L.J.). 30 Motor Oil Hellas (Corinth) Refineries SA v Shipping Corp of India [1990] 1 Lloyd's Rep. 391; Chitty on Contracts, 32nd Ed, Volume 1, Chapter 24. 31 Kosmar Villa Holidays Inc v Trustees of Syndicate 1243 [2008] EWCA Civ 147 32 [2009] EWCA Civ 9
On the facts, the court also noted that the non-waiver clause was not dealing specifically with the exercise of rights so that it could be set aside. The nonwaiver clause stated that «delay, neglect or forbearance [...] shall in any way prejudice any right of that party under this Agreement» but the court did not consider that this had any connection with the issue of election of a contract or of whether or not to exercise a contractual right.
V. Remedies: damages, penalties and equitable relief
The typical remedy for a breach of a commercial contract is likely to be damages. Damages are available as of right unlike equitable remedies (for example specific performance or the grant of injunctive relief). Put very simply, damages can be liquidated or unliquidated. Liquidated damages are damages agreed by the parties in the contract whereas unliquidated damages are not fixed by a contract and must be assessed by the courts (or by statute in certain situations). Liquidated damages are often agreed by the parties with regard to breach of particular obligations of the contract and damages for breaches of other obligations are left for the court to decide. When assessing unliquidated damages, the court will look at the remoteness of damages, so that a party would be liable for losses, whether they occur in the ordinary course of things or are unusual33, as long as the party knew or should have known the losses were likely to occur but also because it can be reasonably considered that the party assumed responsibility for losses of the particular kind suffered34. There is also the requirement to ascertain causality between a party's breach of contract and the other party's claimed loss. In addition, damages may be impacted if the party claimant contributed to the loss by its own negligence. A claimant must also show that it has sought to mitigate its losses. Liquidated damages vs. penalties One aspect of English contract law which may differ with laws of other jurisdictions is the distinctionbetween liquidated damages (damages fixed under the contract which are recoverable) and penalties (damages fixed under the contract which are which are irrecoverable). ____________________________ 33 Tramfield Shipping Inc v Mercator Shipping Inc (The Achilleas) [2008] UKHL48 34 Chitty on Contracts, Chapter 26-107
The test to distinguish liquidated damages from penalties was longstanding until the recent 'much talked about 'two cases in one' of Cavendish Square Holding BV v Makdessi and ParkingEye Ltd v Beavis35 which revisited and re-wrote the test for penalties. Departing from the concept that a penalty clause was a clause which was not a genuine pre-estimate of loss or had for dominant purpose deterrence of a party from breach, the courts are now concerned with whether the party to whom the sum is payable had a legitimate interest in ensuring performance by the other party and the sum payable in the event of breach is not extravagant or unconscionable in comparison to that interest36. This means that if the court does not find that the clause amounts to a penalty, the clause is enforceable even if the payable contractual amount is a lot greater or lesser than the actual loss. Equitable remedies Specific performance, an equitable remedy where the party in breach is compelled by the Court to perform his contractual obligations, can be granted instead of damages but at the court's discretion and under some limitations. Historically, common law did not enforce obligations under a contract except for obligations to pay money. Equitable remedies have then developed to allow parties to obtain alternative remedies to damages in particular cases where awarding monetary damages for breach of contract would not be a feasible or a satisfactory remedy. A very standard equitable remedy is the one of specific performance which is an order of the court which imposes on a party to fulfil its obligations under the contract. Injunctions are also usual equitable remedies when damages are not suitable, and are explored in the last section of this article with interim remedies (although it is not necessarily an interim remedy). Equitable remedies are not granted as of right and certain principles will be observed by the Court when granting such remedies37. The most well-known rale is that a person cannot pursue a legal remedy when the relief would be in connection to a wrong the party committed: «he who comes into equity must come with clean hands». This is also known by the maxim «ex turpi causa поп oritur actio» which means «from an illegal action, action does not arise».
VI. Interim remedies that can be granted by the court
Another feature of the English law system is the wide powers the English Court has to grant interim remedies or relief. The Court derives its general powers and specific powers from common law and also the English Civil Procedure Rules («CPR»). ____________________________ 35 [2015] UKSC 67; the original test was laid out in Dunlop Pneumatic Tyre Co Ltd v New Garage & Motor Co Ltd [1915] A.C. 79 36 Chitty on Contracts, Chapter 26-178 37 Those principles often take the form of proverbs or old maxims which were traditionally in Latin.
The CPR, also referred to as the «White Book», is a collection of very detailed rules and commentaries which regulate every aspect of a claim from pre-action measures to enforcement of a judgment. It also contains practice directions which are guides to each theme and set of rales. Under, the CPR, the Court has general management powers which allows it to make order, impose conditions and specify consequences of failure to comply (Rule 3). The Court may grant interim remedies38 which include granting interim injunction39; orders for detention, custody or preservation of relevant property40; search orders41; disclosure order before claim42. When doing so, it has a wide discretion but at the same time must carefully consider whether such interim measures are justifiable, especially as some of those measures can lead to very drastic consequences. In Coventry v Lawrence, Lord Neuberger approved the case of Jaggard v Sawyer43 where it was stated that reported cases only offer illustrations of circumstances in which judges have exercised their discretion of either awarding damages or granting an injunction instead, and held: «it is only right to acknowledge that this does not prevent the courts from laying down rules as to what factors can, and cannot, be taken into account by a judge when deciding whether to exercise his discretion to award damages in lieu»44. There are many of those factors that the court will have regard to. In terms of the test to apply, in the American Cyanamid v Ethicon Ltd45, the authoritative case on injunctions, Lord Diplock, with the concurrence of the other Law Lords, denied that there was a rale that the claimant needed to establish aprimafacie case (as previously understood) and held that, provided there was a «serious question» to be tried, the matter should be decided on the balance of convenience and certain principles should be applied in determining which way the balance of convenience lies. The court would therefore consider whether damages are suitable to relieve the applicant of the losses. It would also consider whether the parameters of the injunction can be sufficiently clear and fair to be granted. The court would also ask itself the following questions: if the application for an injunction is not granted but the applying party succeeds at trial, to what degree would each party suffer? ____________________________ 38 Pursuant to CPR (Rule 25.1(1)) 39 Rule 25.1(a) 40 Rule 25.1(c)(i) 41 Rule 25.1(h); Section 7 of the Civil Procedure Act 1997 42 Rule 25.1(i), Section 33 of Senior Courts Act 81 43 [1995] 1 W.L.R. 269 44 [2014] A.C. 822 at [120] 45 [1975] A.C. 396 at 407-409
Would one of the parties enjoy an unfair advantage if matters were left open until the trial? Has the applicant for such injunction relief unjustifiably delayed the application? Could it have been done sooner? In addition, the court must be convinced that the defendant is unarguably committing a legal wrong so that the only arguable defence is that the claimant is not the person entitled to complain of that wrong. The decision to grant such invasive and far reaching orders which can be detrimental to a person's life and business is very fact-sensitive and is at the judges' discretion46. Applications must be supported by evidence, unless the court orders otherwise (CPR Rule 25). Subject to any law which says otherwise (e.g. any rule, court guidance), the Court may grant an interim remedy before a claim has been made only if: the matter is urgent (although it is arguably no longer essential but ties into the second requirement); and that is desirable to do so in the interests of justice (CPR Rule 25.2). Application for an injunction is made before the claim form has been issued, the applicant is likely to be required to undertake to the court to issue a claim form immediately. In addition, notice should normally be given unless it enables the defendant to defeat the purpose of the application. The court will allow an application without notice if it appears to the court that there are good reasons for not giving notice. This must be supported with evidence of good reasons for not giving notice. The court should not entertain an application for which no notice has been given unless either giving notice would enable the defendant to take steps to defeat the purpose of the injunction (as in the case of a freezing or search order) or there has been literally no time to give notice before the injunction is required to prevent the threatened wrongful act. The applicant for any interim relief applying without notice or with very little notice is also under a duty of full and frank disclosure. In Orb A.R.L. v Fiddler47, the duty of full and frank disclosure was clearly described by Bingham J. as follows: (1) the applicant must show the utmost good faith and disclose their case fully and fairly; (2) they must, for the protection and information of the defendant, in the evidence in support of the application summarise their case and the evidence on which it is based; (3) they must identify the crucial points for and against the application, and not rely on general statements and the mere exhibiting of numerous documents; (4) they must investigate the nature of the claim asserted and the facts relied on before applying and must identify any likely defences; and (5) they must disclose all facts which reasonably could or would be taken into account by the judge in deciding whether to grant the application. ____________________________ 46 Jaggard v Sawyer [1995] 1 W.L.R. 269, 288) where the judge said as mentioned above in this article: «Reported cases are merely illustrations of circumstances in which particular judges have exercised their discretion, in some cases by granting an injunction, and in others by awarding damages instead. Since they are all cases on the exercise of a discretion, none of them is a binding authority on how the discretion should be exercised. The most that any of them can demonstrate is that in similar circumstances it would not be wrong to exercise the discretion in the same way. But it does not follow that it would be wrong to exercise it differently.» 47 [2016] EWHC 361 (Comm)
In addition, the lawyers have a particular duty to see that the correct legal procedures and forms are used; that a written skeleton argument and a properly drafted order are personally prepared and lodged with the court before the oral hearing; and that at the hearing, the court's attention is drawn to unusual features of the evidence adduced, to the applicable law, and to the formalities and procedures to be observed. Freezing injunctions The primary purpose of afreezing injunction is to prevent a respondent from dealing with or disposing of his/ her any assets located within the jurisdiction (or across many countries) in order to preserve those assets until judgment can be enforced. Freezing injunctions are often considered as the «nuclear weapons» of the English Courts48. Also called a «Mareva» injunction, it originates from case law and the famous case of Mareva Compania Naviera SA v International Bulk Carriers SA (The Mareva)49 but now its requirements can be found in detail in the CPR. This is because, as stated above, the consequences are significant for a person or a business on which a freezing injunction is imposed: no more access to business or personal funds, transfer of money restrictions and reputational damages. Often, a freezing injunction is granted without notice in order to prevent a defendant from dissipating its assets before the order is made, and in one day, someone's business or life can be dramatically affected. The Court has absolute discretion as to whether or not to grant a freezing injunction, as it is an equitable remedy but it will be extremely careful when granting such remedy. The applicant must be in good faith when seeking to apply for a freezing injunction (especially ex-parte), must make reasonable enquiries in order to be able to disclose all matters relevant to the injunction to the court. Very recently, a partner in an American law firm (operating in England and Dubai) failed to disclose that some evidence was incorrectly dated and was found to have misled the High Court when obtaining a US$ 100 million freezing order in relation to the assets of a very wealthy businessman of the Republic of Djibouti. The evidence had suggested that the businessman had been involved in a terrorist grenade attack, when he had not. As a result, the law firm partner faced disbarment and criminal charges50. ____________________________ 48 Bank Mellat v Nikpour [1982] Com. L.R. 158; [1985] F.S.R. 87 at 92 (Donaldson L.J.). 49 [1975] 2 Lloyd's Report 509
English case law has developed a number of safeguards which are used by the judge to determine whether a freezing injunction may be granted. One pre-condition is that at the time of applying for a freezing injunction there must be a particular cause of action. The mere possibility of a future cause of action will not be sufficient51 so that the applicant must be in a position to claim an underlying legal or equitable right. In addition, a judge must be satisfied that the English court has jurisdiction over the dispute. The applicant must also have a «good arguable case». This means that the applicant's claim is more than simply arguable. This does not mean the chances of success need to be greater than 50% but an injunction will not be granted in support of a weak claim52. One important aspect is that the defendant must be in possession of «assets» within the jurisdiction. It is worth noting that the English court can also grant a freezing order in support of foreign litigation even when the country where the litigation is taking place may not have similar powers to grant a freezing injunction53. A standard freezing order (CPR 25 PD 25A) seeks to protect assets which are the property of a person or company which may be made liable for debts. Usually, the assets which are to be frozen have a monetary value which will go towards satisfaction of the judgment debt. It must be proven that there is a real risk that either: the respondent would dissipate or otherwise dispose of his assets otherwise than in the ordinary course of business in order to evade paying from judgment or award owed by him54. It is not enough for the claimant to have suspicion that the potential defendant will act in a certain way. There must be evidence to demonstrate that it is highly likely that the assets if not protected would be removed from the jurisdiction. There are many factors which can be considered by the Court when assessing risk of dissipation such as the ease with which the assets may be removed, the geographical location of the respondent's businesses. The Court will also look at whether the defendant has a «general pattern of evasiveness»55. It is important to consider the scope of the frozen injunction and who will be targeted. For example, will the banks holding the funds be the subject of the freezing injunction as well? ____________________________ 50 Boreh v Republic of Djibouti & Ors [2015] EWHC 769 (Comm) 51 Steamship Mutual Underwriting Association (Bermuda) Ltd v Thakur Shipping Co [1986] 2 Lloyd's Rep 439 (CA) 52 The Niedersachsen [1983] 1 WLR 1412 53 Motorola Credit Corp v Uzan (No 2) [2003] All ER 150; but see Belletti vMorici [2009] EWHC 2316. 54 The Niedersachsen [1983] 2 LR 600, Motorola Credit Corp v Uzan (No 2) [2003] All ER 150 55 Global Maritime Investments Cyprus Limited v Gorgonia Di Navagazione SRL [2014] EWHC 706
Do the banks owe a duty to a third party to ensure that freezing injunctions are enforced against its customers' accounts56? In one case, the English Customs and Excise had obtained a freezing injunction in relation to outstanding VAT owed by two companies over a customer's account at Barclays Bank pic but the bank failed to prevent the transfer of substantial sums out of the accounts. Applying the test to establish a duty of care57, the Court of Appeal held on appeal that it was foreseeable that the Customs would suffer loss as a result of the bank's failure to stop the transfers and the bank was aware of the Customs' interest in that customer's accounts which meant that the relationship was a proximate relationship. In addition, it was fair that the bank being in receipt of the freezing order notice should comply with it58. The House of Lords reversed the Court of Appeal's judgment and held that the bank could only be held liable if it had, in contempt of court, knowingly failed to freeze the customer's accounts. The fact that the bank did not have a system in place for freezing accounts did not mean that, as a third party, it was liable to the Customs. The fact that the bank was on notice of the order imposed a duty on the bank to respect the order of the court but it did not give rise to a duty to the Customs59. The court when granting freezing injunctions may also combine the freezing order with ancillary orders60 to make the freezing order effective, such as a search and seize order or an order to disclose more information. Search and seize orders Search orders allow the entry and search of premises and can be coupled with an order to preserve evidence and property, i.e. taking copies of documents or placing certain assets in custody. This is another very invasive measure which can have very bad reputational effects for a company. Given the nature of such relief, the court must be satisfied that there are just mere suspicions about what will be searched and seized. Search orders may not be used as a «fishing expedition» (which means using the orders in the hope of finding evidence without assuredly knowing that the evidence may be in existence). ____________________________ 56 Customs and Excise Commissioners v Barclays Bank Pic [2004] EWCA Civ 1555 57 Caparo Industries Pic v Dickman [1990] 2 A.C. 605 58 Customs and Excise Commissioners v Barclays Bank Pic [2004] EWCA Civ 1555 59 Customs and Excise Commissioners v Barclays Bank Pic [2006] UKHL 28; [2007] 1 A.C. 181 60 AJ Bekhor and Co v Bilton [1981] 1 QB 923
There must be very serious potential or actual damage to the applicant's interests and clear evidence that the incriminating documents or things are in the respondent's possession. In addition, similarly to the dissipation concept there should be a real possibility that the respondent may destroy or dispose of the material before an application can be made on notice61. Past misconduct will often prove to be sufficient evidence62. When the exercise is taken by an enforcement agency, this can be even more invasive. Such search exercise would take the form of an early morning raid (a «dawn raid») and police may be involved to assist with the search and seize process. Dawn raids are often used by competition authorities63 but also by tax, health and safety, environmental, fraud and other enforcement agencies.
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Содержание ОБЩИЕ ПОЛОЖЕНИЯДиденко А. Вызовы времени: условия гражданско-правовой ответственностиВитрянский В. Ответственность за нарушение обязательствСергеев А. Правовая природа компенсации за нарушение исключительного авторского праваАлимбеков М. Пределы конкретизации норм законодательства в нормативных постановлениях Верховного Суда Республики КазахстанБеляневич Е. Об освобождении субъекта хозяйствования от ответственности за ненадлежащее исполнение договорных обязательствГонгало Б. Защита гражданских прав: основные понятияБелых В. Убытки как средство защиты по праву Англии и РоссииМороз С. Актуальные вопросы защиты прав инвесторовИльясова К. Объекты государственной регистрации в правовом кадастреИсмаилов Ш. Гражданско-правовая ответственность по законодательству ТаджикистанаМэггс П. Бесплатное программное обеспечение с открытым исходным кодом в американском правеСпасибо-Фатеева И. Контуры гражданско-правовой ответственности: обзорный критический анализЩенникова Л. Об институте гражданско-правовой ответственности нотариуса в системе нотариата латинского типаКамышанский В. Следование права залога при трансформации материально-правовой формы предмета залога применительно к процедуре банкротстваТелюкина М. Конкурсная ответственность должника и иных субъектов в российском правеЛебедев К. К вопросу о принципе полного возмещения убытковШепель Т. Является ли недобросовестное поведение при проведении переговоров о заключении договора правонарушением?Рузакова О. Тенденции развития российского законодательства об охране интеллектуальной собственности в условиях международной интеграцииСамарходжаев Б. Некоторые вопросы внешнеэкономической деятельности в республике УзбекистанРостен К. Средства правовой защиты в случае нарушения договора в Соединенных ШтатахКаудыров Т. Правовая охрана интеллектуальной собственности в Казахстане - четверть века развитияМихеева Л. Парадоксы закона о торговле: соотношение с гражданским законодательством РоссииСумида М. О первом условии теории эквивалентности (на примере судебного решения по делу «Maxcalcitol»)Абжанов Д. Об ответственности банка - заимодателя по договору банковского займаНестерова Е. Совершенствование норм о договорной ответственности на основе положений английского права и модельных правил европейского частного праваГалинская Ю. Способы обеспечения исполнения обязательства в Гражданском кодексе Чешской РеспубликиМинаева Т., Барнвел С. Обзор контрактного права Англии |