Article by Aristos Galatopoulos and Luke Stockdale1


The Cayman Islands is a British Overseas Territory with an English-style common-law legal system that comprises statute law and binding case precedents. English case law is highly persuasive in the Cayman Islands in the absence of any Cayman Islands authority. Decisions of other Commonwealth jurisdictions are also persuasive.

The Grand Court of the Cayman Islands (the Grand Court) is the superior court of record of first instance. The caseload of the Grand Court is divided among five divisions.

Commercially significant litigation in the financial services sector is handled by the financial services division (FSD). Every proceeding in the FSD is assigned to one of six highly experienced commercial judges. Hearings by telephone or videolink are permitted and are used regularly.

Appeals from the Grand Court are to the Cayman Islands Court of Appeal (CICA), which usually sits three times each year. Subject to certain restrictions, there is an automatic right of appeal to the CICA from any final decision of the Grand Court. In general, leave of the Grand Court or the CICA is required to appeal an interlocutory decision to the CICA. A further appeal may then lie from the CICA to the Privy Council in London.


In 2013, the Cayman Islands courts dealt with a number of significant commercial cases and clarified several important legal issues. Summarised below are decisions that will be of interest to practitioners and those in the financial services industry.

i Re FIA Leveraged Fund (CICA, 18 February 2013)

If permitted by their constitutional documents, investment funds may redeem shareholders 'in kind'. This decision makes clear that assets distributed in kind must have a real commercial value determined in good faith using a transparent methodology.

The fund purported to redeem investors in kind by distributing shares in a Delaware special purpose vehicle (SPV) to them. The only asset of the SPV was an option to purchase shares in a publicly traded US bank, the public filings of which showed that it considered the option to be worthless.

Redeeming investors petitioned to wind up the fund on the grounds of insolvency, arguing that the in-kind distribution was worthless and, therefore, insufficient to satisfy their redemption debt. The fund disputed that any debt was due,2 relying on its constitutional documents that permitted the board of directors 'in its sole discretion' to determine the value of the assets forming the redemption in kind.

The CICA upheld the Grand Court's decision to wind up the fund. The CICA held, by reference to the fund's constitutional documents, that a distribution in kind had to be made from assets in the fund's portfolio on the date the redemption proceeds were due to be paid. As the SPV shares were not assets of the fund on that date (given that the SPV was only incorporated later), the purported distribution of the SPV shares was not permissible.

The court also held that, although the directors undoubtedly had discretion under the fund's constitutional documents to determine the value of assets used in the in-kind distribution, there needed to be a proper basis for adopting a particular valuation. There was no evidence of such a basis for the valuation of the SPV shares in this case.

ii VTB v. Universal Telecom Investment Strategies Fund SPC (CICA, 5 June 2013)

In this case, the CICA confirmed for the first time that 'free-standing' freezing injunctions in support of foreign proceedings are available in the Cayman Islands.

The Cayman Islands proceedings were related to proceedings in England between VTB and a Russian businessman, Mr Malofeev, in which VTB alleged, among other things, fraud. VTB sought a freezing injunction against a Cayman Islands fund, UTISF, the shares of which were beneficially held by Mr Malofeev. VTB did not allege any wrongdoing against UTISF but sought a freezing injunction against it on the basis of the Grand Court's 'Chabra' jurisdiction.3 That jurisdiction permits the court to make a freezing order against a third party where assets held by it could be used to satisfy a judgment against an alleged wrongdoer, and there is a risk of the assets being dissipated.

In a landmark judgment, the CICA confirmed the availability of free-standing freezing injunctions in the Cayman Islands in support of foreign proceedings, holding that – contrary to what had commonly been understood to be the position – there need not be a defendant involved in the Cayman Islands proceedings against whom substantive relief is sought. Such injunctive relief is available provided that the party against whom the injunction is sought is subject to the court's jurisdiction and that the substantive claim against the alleged wrongdoer, wherever brought, is founded on a cause of action recognised by the Cayman Islands court.

iii Crawford Adjusters v. Sagicor General Insurance (Cayman) Ltd [2013] 4 All ER 8

This decision of the Privy Council on appeal from the CICA effectively extended the tort of malicious prosecution to all civil proceedings.

One of the appellants, Mr Paterson, was a chartered surveyor who had been engaged by Sagicor, an insurance company, to calculate the value of certain insurance claims. Sagicor then obtained a report from a different chartered surveyor that contained a lower figure for Sagicor's liability. Sagicor brought proceedings against the appellants alleging fraudulent misrepresentation, deceit and conspiracy, but discontinued its claims before trial. The appellants continued a counterclaim that they had brought against Sagicor for unpaid fees and added a claim for malicious prosecution.

The Grand Court and CICA held that all four elements of the tort of malicious prospection were made out, namely that the prior proceedings had been determined in the appellants' favour; the allegations of fraud and conspiracy by Sagicor had been made without reasonable cause; the allegations had been made maliciously; and as a result, the appellants had suffered substantial damage. Nevertheless, both courts considered that they were constrained by previous authority to hold that the tort of malicious prosecution could not be extended to civil proceedings. By a majority of three to two, the Privy Council found that the appellants could succeed in their claim for malicious prosecution and that the public policy underpinning the earlier decisions was no longer applicable.

iv In re Cybernaut Growth Fund, LP (Grand Court, 23 July 2013)

This case involved consideration by the Grand Court of the circumstances in which it would stay winding-up proceedings alleged to be brought in breach of an arbitration agreement.

An investment fund, structured as a Cayman Islands exempted limited partnership (ELP), was sought to be wound up on just and equitable grounds by certain of its investors.4 The general partner and the other limited partner applied to the court to have the petition stayed on the grounds that it fell within the arbitration clause in the partnership agreement.5

The court considered the decision of the English Court of Appeal in Fulham Football Club (1986) Ltd v. Richards.6 That decision confirmed, as a matter of English law, that an arbitral tribunal is unable to make winding-up orders, but gave rise to the question of whether the tribunal could decide matters that may form the basis for a winding-up order without going so far as to actually make a winding-up order.

The Grand Court held that the petition before it was not arbitrable. It examined the Fulham decision and concluded that a stay of winding-up proceedings in favour of arbitration could only be granted where the petition includes discreet inter partes claims falling within the arbitration agreement, or matters that can properly be tried as preliminary issues. Neither of those exceptions applied in the case and the stay application was therefore dismissed.

v Swiss-Asia Genghis Hedge Fund v. Maoming Fund (Grand Court, 24 July 2013)

This was a further decision of the Grand Court concerning the enforceability of a side letter between a fund and an investor.7 Two decisions of the Grand Court in 20128 provided examples of situations where purported side agreements were held to be unenforceable. This decision, by contrast, demonstrates the willingness of the Cayman Islands courts to give effect to a properly drafted side letter that complies with a fund's governing documents.

The court enforced the terms of a letter agreement between the beneficial owner of shares in a Cayman Islands fund and the fund, notwithstanding that the custodian through which the shares were held did not sign the letter. While not undermining the important principle that a company is not required to look behind its share register, the court recognised that as a matter of commercial reality a company may, if it wished, deal with the beneficial holders of its shares. On the facts of the case, the letter agreement was held to be binding on the fund because the court considered that the beneficial owner had acted as agent for the custodian in entering into the letter agreement; and an estoppel operated to prevent the fund from denying that it was bound by the agreement.

This decision confirms that a properly structured side letter can be a valid mechanism for agreeing separate investment terms with particular investors. The legal analysis in the recent decisions concerning side letters is likely to be affected by the Contracts (Rights of Third Parties) Bill, which, if enacted, will allow parties to contracts to agree to extend the right to rely upon and sue under the contract to non-parties.

vi Weavering Macro Fixed Income Fund Limited (in Official Liquidation) v. Ernst & Young (Grand Court, 2 October 2013)

The Cayman Islands courts will give agreements a commercially sensible construction by seeking to ascertain the meaning that the words used would convey to a reasonable man against the relevant background to the agreement. If something has clearly gone wrong with the contractual language, the court will not attribute to the parties an intention that they plainly did not have.

This case concerned a claim by a fund in liquidation against its former auditors. Prior to the commencement of the proceedings, the parties entered into a series of standstill agreements to prevent the running of the limitation period while they discussed the claim. The agreements stated that the limitation period was suspended until a specified 'long-stop date' and provided that the parties were prevented from 'issuing and dispatching and serving proceedings' until the long-stop date. The fourth standstill agreement specified the long-stop date as 5pm on 30 November 2012. The plaintiff issued proceedings on 30 November 2012 before 5pm but did not serve them until 26 March 2013. The court had to determine whether this was a breach of the fourth standstill agreement. There was an inconsistency in the agreement as it clearly contemplated the plaintiff being able to issue proceedings on the long-stop date but the reference to 5pm was after the scheduled closing time of the court office, suggesting that the plaintiff was only permitted to issue proceedings after the long-stop date.

The court applied the principles of contractual interpretation set out in a series of House of Lords and Privy Council decisions9 and concluded that the plaintiff had not breached the standstill agreement. The judge considered that the parties' intention was that the plaintiff was permitted to issue proceedings on the long-stop date and the inclusion of the time stipulation was merely a drafting inconsistency that did not contradict that intention.


i Overview of court procedure

General litigation in the Grand Court is governed by the Grand Court Rules (GCR). The FSD has also issued an FSD User's Guide, which sets out timing and procedures to be followed in the FSD.

Winding-up proceedings are governed by the Companies Winding-Up Rules (2008 Revision) (as amended) (CWR).

The GCR and CWR are each overseen by procedural rules committees comprising judges of the Grand Court and experienced practitioners.

ii Procedures and time frames

Proceedings under the GCR

In general, litigation is commenced by way of a writ endorsed with a statement of claim setting out the nature of the plaintiff's claim and the relief sought. Once issued, the writ must be personally served on the defendant.10 For service on defendants outside the jurisdiction, leave of the court is required (see Section III.v, infra). If a defendant intends to defend the action, it must acknowledge service, file a notice of intention to defend and then file a defence. The plaintiff can then file a reply to the defence. Counterclaims may also be filed within the same proceeding. The GCR set out default provisions that apply to the timing of proceedings, giving parties 14 days to respond at each new stage of the proceeding. Lists of discoverable documents must be exchanged 14 days after pleadings close (see section V.ii, infra).

These default provisions are usually modified by consent of the parties or the direction of the court. In the FSD, proceedings are assigned to a particular FSD judge who is responsible for case management and determining all interlocutory issues, as well as presiding at the trial or final hearing. Case management conferences (CMCs) are normally held at an early stage to set out the timetable for the proceedings, as agreed between the parties or as determined by the court. CMCs are held periodically throughout the proceedings to revise the timetable and deal with other interlocutory matters as necessary.

As much of the commercial litigation before the Grand Court is complex, crossborder and involves heavy interlocutory applications, cases can take up to two years to come to trial.

Proceedings under the CWR

Winding-up proceedings are commenced by way of a petition supported by affidavit evidence. Generally, winding-up proceedings are decided on affidavit evidence without discovery of documents. A creditor's winding-up petition will typically be heard within six to eight weeks of filing.

Interlocutory hearings

Interlocutory applications are made by summons and typically proceed on affidavit evidence only. The summons must be served on the other party not less than four clear business days before the hearing date. Normally, a summons will be listed for hearing within two to six weeks depending on the nature and length of the application and court availability.

Interim applications

Interim relief may be available to a plaintiff pending trial. Urgent injunction applications are often heard ex parte in the first instance and can be heard on short notice. At the ex parte hearing, the court can grant an injunction until an inter partes hearing shortly afterwards. At the inter partes hearing, the court can grant an injunction pending trial. The court will usually require the applicant to provide a cross-undertaking as to damages to protect the defendant in the event that at trial it is established that the injunction should not have been granted. In some circumstances, the court will require fortification of the undertaking by payment of a sum of money into court.

The following types of relief are available:

  1. an injunction preventing a party from carrying out, or requiring a party to carry out, certain actions;
  2. a freezing (Mareva) injunction to restrain a party from disposing of or dealing with certain assets;
  3. an Anton Piller order to require the defendant to permit persons to enter his premises, search for documents or other moveable property;
  4. disclosure (Norwich Pharmacal and Bankers Trust) orders (see Section III.v.ii, infra); and
  5. an order under GCR Order 30 appointing a receiver in relation to particular property.

iii Class actions

Where numerous parties have the same interest in any proceedings, the Grand Court may grant permission for the proceedings to be continued as representative action. Any judgment obtained in such proceedings is binding on all the parties who are represented. However, the judgment cannot be enforced against them without further leave of the Grand Court.

iv Representation in proceedings

The legal profession in the Cayman Islands is fused. Attorneys liaise directly with their clients on a day-to-day basis and also appear as advocates in court. Barristers from overseas may be engaged to appear as advocates but must first be admitted by the Grand Court to practise in the Cayman Islands on a limited basis for the duration of the trial or application.11

v Service out of the jurisdiction

Leave of the court is required to serve any originating process on a party outside the jurisdiction. GCR Order 11 sets out a list of the types of claims for which leave may be given. An applicant for leave must show that:

  1. there is a good arguable case that the claim has an appropriate nexus to the Cayman Islands under one or more of the heads set out at GCR O.11 r1;
  2. there is a serious case to be tried on the merits; and
  3. it is proper in the exercise of the court's discretion to grant leave and particularly that the Cayman Islands are the appropriate forum.

vi Enforcement of foreign judgments

Foreign money judgments may be enforced by action at common law. Certain Australian money judgments can be enforced by way of a statutory registration procedure.12

A common-law enforcement action is commenced by the issue of a writ setting out the facts of the original cause of action, the foreign court's jurisdiction over the debtor, particulars of the judgment and confirmation that money is owed on the judgment.

At the hearing of the application, the applicant must demonstrate that the judgment satisfies the criteria for enforcement, which include that it:

  1. was made by a court of competent jurisdiction;
  2. is final and conclusive; and
  3. is not impeachable on the grounds of fraud or contrary to public policy.13 vii Assistance to foreign courts


Pursuant to the Evidence (Proceedings in Other Jurisdictions) (Cayman Islands) Order 1978, if requested by a foreign court or tribunal, the Grand Court may make an order to allow evidence to be obtained in the Cayman Islands in support of foreign proceedings. The Grand Court has the power to make any appropriate order to obtain the evidence, including the examination of witnesses orally or in writing and the production of documents.

The Grand Court can grant such assistance where it is satisfied that the requesting court is exercising jurisdiction in a country outside the Cayman Islands and the evidence is to be obtained for the purposes of civil proceedings before that court.

Orders to produce information

Under the Norwich Pharmacal14 jurisdiction, the court may order a person, whether or not he or she is a party to the substantive proceedings, to disclose information about wrongdoers and the location of their assets. Such an order can be granted in support of foreign proceedings on an application by a party without the need for any letter of request from the foreign court. The applicant must show that:

  1. a wrong has been done to the applicant by a wrongdoer and the applicant intends to assert their legal rights;
  2. an order is necessary to assist the applicant in achieving justice and there is no other practical source of information available; and
  3. the respondent is a person who was involved in the wrongdoing (even innocently) and is able to provide the information necessary to enable the wrongdoer to be identified.

A related form of relief, known as a Bankers Trust15 order, is also available. Such an order requires a person involved in the disposal of assets to disclose information concerning the assets where there is strong evidence that fraud has occurred and an urgent need to identify the whereabouts of the assets.

Foreign insolvency proceedings

Part XVII of the Companies Law provides that where a foreign legal entity is subject to foreign bankruptcy proceedings in its country of incorporation, on the application of the foreign insolvency representative, the Grand Court may make orders:

  1. recognising the right of the foreign representative to act in the Cayman Islands on behalf of the debtor;
  2. staying legal proceedings against the debtor;
  3. requiring a person in possession of information relating to the debtor to be examined by and produce documents to the foreign representative; and
  4. requiring any property belonging to the debtor to be turned over to the foreign representative.

viii Access to court files

The court office maintains hard-copy files of all originating process filed in the Grand Court and all final judgments or orders given by the Grand Court, which are open to public inspection upon the payment of a fee.

Affidavit evidence and interlocutory applications and orders are not available for public inspection. A third party not involved in the proceedings may make an application to the court for leave to inspect the court file.

ix Litigation funding

Third-party litigation funding agreements governed by Cayman Islands law will not be permitted unless they are structured in a manner that does not offend against the common law rules of maintenance (providing assistance for litigation with no legally recognised motive) and champerty (funding litigation in return for receiving a share of the proceeds).

Contingency agreements, which involve sharing the proceeds of litigation with an attorney, are not permitted.16 Conditional fee agreements (CFAs), which involve an uplift in fees in the event of success in litigation, have been the subject of recent scrutiny by the Cayman Islands courts. Most recently, the Grand Court has ruled that CFAs are enforceable as between the attorney and the client, where they are fair and reasonable in all the circumstances and have been approved in advance by the court.17 In 2012, the CICA expressly left open the question of the enforceability of CFAs as between attorney and client, whilst ruling that the amount of the uplift is not recoverable from an opposing party pursuant to a costs award made by the court.18 At the time of writing the Cayman Islands Law Reform Commission is conducting a review into contingency agreements and CFAs and this is likely to be a topic that attorneys and litigants will be monitoring closely in the coming year.


i Conflicts of interest and Chinese walls

The general principle is that, in the absence of consent, a firm should not act for a client where there is a conflict of interest with another existing or former client.19

Chinese walls are permitted and expressly recognised in the Cayman Islands Code of Conduct for Attorneys. Proper restrictions must be put in place to prevent leakage of confidential information, including physical separation of attorneys and hard-copy files, firewalls around electronic files and undertakings by the attorneys. Whether a Chinese wall is an appropriate means by which to manage a conflict depends upon the circumstances of the individual case.

ii Money laundering, proceeds of crime and funds related to terrorism

Cayman Islands anti-money laundering (AML) and proceeds of crime legislation are contained principally in the Proceeds of Crime Law, 2008 (PCL) and also in the Misuse of Drugs Law (2010 Revision) and the Terrorism Law (2011 Revision). The PCL is supplemented by the Money Laundering Regulations (2013 Revision) (the Regulations) and the Guidance Notes on the Prevention and Detection of Money Laundering in the Cayman Islands.

Regulation 5(1) requires that anyone carrying out 'relevant financial business' must, except in certain prescribed circumstances, maintain appropriate procedures to prevent money laundering, including client identification and verification procedures, record keeping, staff training and designation of a compliance officer responsible for maintaining AML procedures. The provision of legal advice in relation to litigation would not ordinarily constitute 'relevant financial business' within the meaning of the Regulations.

Pursuant to the PCL and the Terrorism Law, lawyers also have the obligation to report knowledge or suspicion of money laundering or terrorist activity that comes to their attention to the Financial Reporting Authority of the Cayman Islands. However, a lawyer is not required to do so where the information is obtained in privileged circumstances, unless it has been given in order to further a criminal purpose.

iii Data protection

The processing of personal data by professional persons (including attorneys) in the Cayman Islands is governed by the Confidential Relationships (Preservation) Law (2009 Revision) (CPRL), common law duties of confidentiality and professional rules.

The CRPL codifies the common law duty of confidentiality and the exceptions to it. Other than in certain prescribed circumstances, the CRPL makes it a criminal offence for professional persons to disclose 'confidential information'20 in their possession that arises in or is brought into the Cayman Islands, without the consent of the relevant principal or the permission of the Grand Court. Accordingly, in the absence of consent from the principal, it may be necessary to seek directions from the court before documents containing personal data belonging to a principal can be disclosed in litigation, either in the Cayman Islands or elsewhere.

The law on data protection in the Cayman Islands will be supplemented by a new statutory regime should the Data Protection Bill be enacted. The Bill is based on the European Data Protection Directive and is intended to exist alongside the CRPL and common law duties of confidentiality.


i Privilege

If a document falls within one of the categories of privilege, it need not be produced in litigation, however, it must still be identified on the party's list of discoverable documents.

The main recognised categories of privilege are:

  1. legal professional privilege, which comprises:

    • legal advice privilege, which applies to documents recording communications between lawyers and clients for the purpose of obtaining or providing legal advice; and
    • litigation privilege, which applies to documents created for the dominant purpose of litigation that is contemplated or in progress at the time the document is created and can apply to communications with third parties;
  2. without prejudice privilege, which applies to communications between the parties directly or between their lawyers relating to the settlement of a dispute;
  3. privilege against self-incrimination, which allows a party to claim privilege in respect of documents that may put him or her at risk of criminal prosecution; and
  4. privilege on the grounds of public policy, which prevents disclosure of documents where such disclosure would be injurious to the public interest.

As noted above, where the CRPL applies, a litigant may also need a court order permitting him or her to disclose the relevant documents in the discovery process.21

The same rules of privilege apply to in-house counsel and to foreign lawyers involved in Cayman Islands proceedings. Such individuals may also be subject to the terms of the CPRL if they hold confidential information within the meaning of the CRPL that arises in or is brought into the Cayman Islands.

ii Production of documents

After the close of pleadings, each party must make available to the other party any relevant documents he has or had in his possession, custody or power relating to the matter at issue in the case.

Parties' discovery obligations are broad, and extend to all documents that may either advance or damage the case of the party seeking discovery and documents that may fairly lead to a train of enquiry that would have either of those consequences.22 However, the court will not permit requests for documents that amount to a 'fishing expedition'.23

Where a third party is controlled by the litigant or where the litigant has the right to obtain the document from the third party, the documents are considered to be in the litigant's power of procurement and are discoverable.

Electronic records or anything on which evidence or information is recorded (e.g., tapes, videos) are considered to be documents for the purposes of discovery. Any electronic media, to the extent that it contains information capable of being retrieved and converted to readable form is considered to be a document. It is immaterial that documents, electronic or otherwise, are overseas.

There are no rules governing electronic discovery in the Cayman Islands. However, a party can apply for an order that in-depth electronic discovery of media that are not readily accessible would be oppressive or disproportionate, depending on the circumstances of the case.


The vast majority of disputes are resolved by litigation rather than any alternative dispute resolution (ADR). There is no requirement for parties to attempt ADR prior to commencing litigation. Nevertheless, many of the FSD judges support the use of ADR and it is likely that its use will become more common.

The Cayman Islands Arbitration Law, 2012 came into force in July 2012 (the Arbitration Law). It is based on the UNCITRAL Model Law and the English Arbitration Act 1996.

The provisions of the Convention on the Recognition and Enforcement of Foreign Arbitral Awards 1958 (the New York Convention) relating to the enforcement of foreign arbitral awards have effect pursuant to the Foreign Arbitral Awards Enforcement Law (1997 Revision). New York Convention awards will be enforced unless the respondent establishes one of the defences set out in the Convention. Non-New York Convention awards are enforceable at common law in the same way as foreign judgments (see Section, supra).

There is a Cayman Islands chapter of the North American branch of the Chartered Institute of Arbitrators and a number of local firms have practitioners with ADR qualifications. Arbitration is not used frequently, although with the enactment of the Arbitration Law, its use may increase.

The Arbitration Law sets out the procedures that govern arbitrations in the Cayman Islands and the duties of the arbitral tribunal. Many of the duties and procedures can be modified by agreement between the parties. However, any tribunal must act fairly and impartially, allow each party a reasonable opportunity to present his or her case, and conduct the arbitration without unnecessary delay or expense.

A party may, with leave of the Grand Court, appeal an arbitral award to the Grand Court on a point of law.24 A party may also apply to the Grand Court to set aside an award in certain prescribed circumstances consistent with the rules in the New York Convention.25


The Cayman Islands courts continue to deal with the resolution of complex, high-value financial services litigation and insolvency proceedings with cross-border elements. There is no sign that this activity will slow down.

The governance in investment structures is expected to remain a hot topic and the long-awaited decision of the CICA in the Weavering directors' duties litigation is anticipated to keep the spotlight on this area.

The Cayman Islands courts are regularly called upon to provide assistance to parties and courts outside the jurisdiction in connection with foreign proceedings. The courts will continue to grapple with issues of cross-border assistance, comity and the recognition of foreign judgments. The decision of the CICA in the Picard v. Primeo Fund litigation concerning the recognition of foreign insolvency practitioners will no doubt be a useful addition to the growing jurisprudence on this topic.

This article first appeared in the sixth edition of The Dispute Resolution Review, published by Law Business Research Ltd.


1 Aristos Galatopoulos is a partner and Luke Stockdale is an associate at Maples and Calder.

2 It is a general principle of insolvency law that a winding up petition may be dismissed where there is a bona fide dispute over whether the debt is owed.

3 Named after the English decision TSB Private Bank International SA v. Chabra [1992] 1 WLR 231.

4 Which were limited partners in the ELP.

5 Section 4 of the Foreign Arbitral Awards Enforcement Law (1997 Revision) requires the court to stay proceedings brought in breach of an arbitration agreement, unless satisfied that the agreement is null and void, inoperative or incapable of being performed or that there is no dispute between the parties.

6 [2012] Ch 333.

7 Side letters are a common feature of Cayman Islands investment funds which are typically used to grant cornerstone investors more favourable investment terms.

8 In re Medley Opportunity Fund Ltd [2012] (1) CILR 360 and Lansdowne v. Matador Investments Limited (in official liquidation) [2012] (2) CILR 81.

9 Including Mannai Investment Co Ltd v. Eagle Star Life Assurance Co [1997] AC 749; Investors Compensation Scheme v. West Bromwich Building Society [1998] 1 WLR 896 and Chartbrook Ltd v. Persimmon Homes Ltd [2009] 1 AC 1101.

10 For a corporate defendant, this can be effected by delivering the writ by hand to the registered office.

11 Section 4(a) of the Legal Practitioners Law (2012 Revision).

12 A recent decision of the Grand Court, Picard v. Primeo Fund, Grand Court, 14 January 2013, considered the recognition of foreign insolvency practitioners and the powers they can exercise in the Cayman Islands. The case considered the effect of the Supreme Court decision in Rubin v. Eurofinance SA [2012] UKSC 46 and the Privy Council decision in Cambridge Gas v. Navigator Holdings plc [2007] 1 AC 508. At the time of writing, an appeal in the proceedings is before the CICA.

13 Olearius Ltd v. Walker Intl Holdings Ltd [2003] CILR 457.

14 Named after the English decision Norwich Pharmacal Co v. Commissioners of Customs & Excise [1974] A.C. 133 and applied in numerous Cayman Islands cases (e.g., Deutsche Bank v. Codelco [1996] CILR 1).

15 Named after the English decision Bankers Trust Co v. Shapira [1980] 1 WLR 1274 and recognised in the Cayman Islands (e.g., in Braga v. Equity Trust Company (Cayman) Limited [2011] (1) CILR 402).

16 Quayum v. Hexagon Trust Company (Cayman Islands) Limited [2002] CILR 161.

17 Re DD Growth Premium 2x Fund (in Official Liquidation) (Grand Court, 23 October 2013).

18 Attorney General v. Barrett [2012] (1) CILR 127.

19 Rules 1.11 - 1.13 of the Code of Conduct for Cayman Islands Attorneys.

20 Confidential information includes information concerning any interest or claim in money or other property which the recipient thereof is not, other than in the normal course of business, authorised by the relevant principal to divulge.

21 GCR O.24, r.5.

22 Compagnie Financiere v. Peruvian Guano Co (1882) 11 QBD 55, applied in Renova Resources Private Equity Limited v. Gilbertson [2011] (2) CILR 148.

23 In re C [1994-95] CILR 254.

24 Section 76 of the Law. The operation of this Section can be excluded by agreement of the parties.

25 Section 75 of the Law.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.