Cayman Islands: Gathering Evidence In The Cayman Islands To Support Proceedings Elsewhere

Last Updated: 27 July 2007
Article by Diarmad Murray

Most Read Contributor in Cayman Islands, September 2018

Gathering evidence in the Cayman Islands is governed by the Evidence (Proceedings in Other Jurisdictions) (Cayman Islands) Order 1978 (SI 1978/1890) (the 1978 Order). The 1978 Order extended to the Cayman Islands the provisions of the Evidence (Proceedings in Other Jurisdictions) Act 1975, a United Kingdom statute with modifications.

The 1978 Order makes provisions for requests for obtaining evidence from foreign courts entertaining civil proceedings. The question whether proceedings are a civil or commercial matter depends on the classification of those proceedings according to the law of the requesting court and the law of the court to which the request was made. In this case, Cayman law.

The 1978 Order sets out, not exhaustively, some of the things the court may order to be done to give effect to a request from a foreign court for obtaining evidence. These are:

  • the examination of witnesses, either orally or in writing;
  • the production of documents;
  • inspection, photographing, preservation, custody or detention of any property;

  • taking of samples of any property and the carrying out of any experiments on or with any property or
  • a medical examination of any person including taking and testing samples of blood.

The power to require steps to be taken is limited to those steps "which can be required to be taken by way of obtaining evidence for the purposes of civil proceedings in the court making the order." This prohibits the court from, inter alia, ordering pre-trial production of documents to aid potential foreign proceedings.

Mr Justice Anthony Smellie QC (as he then was) summarised:

"Put in general terms, this court has a duty to assist the foreign court to the extent that it is proper to do so under local law… Full faith and credit must be given to the request of the foreign court just as full faith and credit would be given to a foreign judgment."

However, effect will not be given to a letter of request whose function is shown to be merely exploratory or investigatory. The 1978 Order is not intended to empower the court to assist fishing for evidence.

Document Disclosure

The 1978 Order prevents the court from ordering a party to give a general disclosure statement listing relevant documents which were or are in his possession, custody or control.

"Particular" documents must be specified in the order being made by the requested court. Where documents are sought, the classes of documents must be clearly defined and the actual, "particular" documents specified. It must also be shown that there is good reason to believe that the documents actually exist. However, the standard of particularity to be required in any given case will be considered in the context of the circumstances of the case and the nature of the documents required.

Orders for the production or deposition of information which is confidential will be regulated by the Confidential Relationships (Preservation) Law, and the persons subject to the order may need to seek directions regarding disclosure from the court. If the person would be exempted from providing evidence under the laws of the requesting court's territory, he is similarly exempt in the Cayman Islands.

The procedure for applying for an order pursuant to a letter of request is governed by Order 70 of the Grand Court Rules. The application may be ex parte, and must be supported by affidavit evidence exhibiting the letter of request.

Norwich Pharmacal Relief Against A Person Domiciled In The Cayman Islands

A Norwich Pharmacal order can be ordered by the court against third parties involved in wrongdoing. The intention is to ascertain the identity and address of the primary wrongdoer.

On an application against a third party to disclose the identity of a wrongdoer, the court must be satisfied that:

  • the order will not grant disclosure against a person who is not a party to the action but who could be called as a witness in the action;
  • the wrongdoer has been involved in or facilitated the wrongdoing; and
  • the interests of justice favour the making of the order.

There does not have to be a definite intention to bring legal proceedings in the Cayman Islands. However, it would presumably be an abuse of the court’s process to issue a summons in Cayman for Norwich Pharmacal relief for the sole purpose of fishing for "pre-trial" evidence for proceedings in another jurisdiction.

Usually if a Norwich Pharmacal order is made, the plaintiff is forbidden to use or rely on the disclosure for legal proceedings without the permission of the court. The exception is in the current action or in bringing civil proceedings against an individual identified as the source of the documents coming into the possession of the defendant.

An application may be made by way of Originating Summons. Norwich Pharmacal relief may be the sole relief sought or ancillary relief. The order may be granted under an interim application, normally with notice but, in exceptional circumstances, without. The plaintiff should clearly identify the wrongdoing and identify the purposes for which disclosure will be used. Ordinarily the Applicant will be ordered to pay the costs of the party making the disclosure, including the costs of reasonably opposing the application.

Mareva Injunctions

In the event that an injunction was sought from the Grand Court, substantive proceedings would need to be commenced, or an undertaking given that they will be commenced. Within those proceedings, injunctive relief may be sought seeking to either freeze assets in the jurisdiction and/or require parties to provide information by way of disclosure. If proceeding by Mareva injunction, the court must be satisfied that:

  • there is a good arguable case again the defendant;
  • assets belonging to the defendant are within the court’s jurisdiction; and
  • there is a real risk that unless the injunction is granted, judgment will go unsatisfied.

The affidavit(s) providing this evidence must also make full and frank disclosure of all matters, good or bad, that the court should consider in making any order.

The initial application to the court will likely be on an ex parte basis and, once the order has been made and served, the defendant may apply to the court for its discharge. The order will require the recipient to provide an affidavit disclosing assets. The defendant can then challenge the order or seek payment of living expenses, legal costs and other reasonable expenses.

At the same time as applying for the disclosure order, an order that the respondent file an affidavit verifying the information required should also be filed. There should also be an order that the respondent bank or financial institution not communicate the existence of the order to its customer or client.

Three practical issues arise on applications of this nature. One is the provision of an undertaking in damages in the event that the plaintiff was not entitled to an injunction or disclosure order. The second is security for costs in the event that the plaintiff is resident outside Cayman. The third is the question of confidentiality.

Confidentiality

The disclosure of confidential information is governed by the Confidential Relationships (Preservation) Law (1995 Revision) (CRPL).

The CRPL was enacted with a view to protecting business activities by defining what constitutes confidential information, the circumstances in which such information can lawfully be disclosed and prescribing penalties for unlawfully disclosing confidential information.

The CRPL makes it a criminal offence to "divulge" or "attempt, offer or threaten to divulge" confidential information. The term "confidential information" is very widely defined and essentially includes all information.

There are several exceptions. The CRPL does not apply to the seeking, divulging or obtaining of confidential information if information is given to a Court Tribunal or other relevant authority, whether within or outside the Cayman Islands, "and" directions have been obtained from the Grand Court of the Cayman Islands authorising such disclosure.

The applicant must state the circumstances in which the evidence is to be given, identifying the principal of the information and the basis of the confidential relationship, the nature of the evidence and an explanation as to why it constitutes confidential information, and the grounds on which the principal objects to the proposed disclosure.

The application is heard by a Judge sitting alone and in camera. In making any determination the Judge will consider the interests of justice (in a criminal case) and public policy, any offer of compensation or indemnity, and whether an order would operate as a denial of the rights of any person in the enforcement of a just claim.

Accordingly, in circumstances where, for example Mareva relief and related disclosure or Norwich Pharmaceutical relief is ordered, it will be necessary for a third party to either obtain consent of the principal concerned or, failing that, make a Section 4 application to the court seeking an order from the Grand Court that the disclosure be made.

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.

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