Cyprus: Interim Orders And Injunctions In Cyprus

Last Updated: 16 June 2017
Article by Michael Chambers & Co

Interim orders or injunctions are temporary court orders which oblige someone to act or not to act in a specific way. One of the primary reasons that Courts grant interim orders is to protect the interests of the parties involved in litigation or arbitration proceedings. Furthermore, a breach of an injunction constitutes a contempt of Court which is punishable by either penalty or imprisonment or both.

Cyprus Courts can issue interim orders:

According to Section 32 of Court of Justice Law (14/60), Cypriot Courts have jurisdictions to issue interim orders or injunctions, "in all cases, in which it appears to the Court, just and convenient to do so"1, provided that:

  1. A serious issue exists, that is to be tried at the hearing;
  2. It appears that the Applicant has a "probability" to obtain a favourable judgement;
  3. There is a significant risk that if the interim order is not issued, it will be difficult or impossible for Justice to be served at a later stage;
  4. The balance of convenience is in favour of the Applicant;

An interim order is issued following an application from a party involved in litigation or arbitration proceedings. As it has been mentioned before, an interim order obliges someone to do something or prevents someone from doing something. An illuminating example can be an interim order against the risk of alienation of assets.

What types of interim order can be granted by Cyprus Courts?

The main types of interim orders are the prohibitory and mandatory injunctions. A prohibitory injunction prevents someone from doing something. On the other hand, a mandatory injunction obliges someone to do a specific act within a well-defined timeframe.

Among the main categories of interim orders issued by Cyprus Courts are:

  1. Freezing Injunctions are used for the protection of assets situated in Cyprus or abroad. Assets may include movable and/or immovable property. Freezing Injunctions are also known as 'Mareva' injunctions due to the case Mareva Campania Naviera SA v International Bulk Carrier SA2. The main purpose of Mareva injunctions is to ensure that a judgement will be enforced. If the assets are not situated in Cyprus, then the defendant should be a permanent resident of the Republic of Cyprus, and be subject to the jurisdiction of Cyprus Courts.
  2. Injunctions preventing specific acts or events from happening. Cyprus Courts can issue interim orders in order to block various acts or events, i.e. the implementation of corporate resolutions, the convention of Shareholders Meeting of Cyprus Companies, the Annual General Meeting of a company, etc.
  3. Discovery and Disclosure order (Norwich Pharmacal) is a procedure whereby someone may discover the identity of an alleged wrongdoer through a party who facilitated the wrongdoing. Discovery and Disclosure orders are widely known as ''Norwich Pharmacal'' orders due to the case ''Norwich Pharmacal Co. & Others v Customs and Excise Commissioners"3. In the context of such applications, Cyprus Court can issue orders for:
    Disclosure an oath by a respondent of the location and value of his/her assets;
    Disclosure of information and documents regarding assets deprived or stolen from the applicant, in order to enable the victim of fraud, to identify the wrongdoer and pursue legal proceedings against him/her.
    In case, there are no alternative means to obtain the necessary information, then the discovery and disclosure order can be issued against any person, involved or not to the action. In addition, this order can be issued against professionals and banks despite the professional privilege and bank secrecy.
  1. Chabra Orders are issued by Cyprus Courts against a defendant other than the main defendant, where there are grounds to believe that a co-defendant is in possession or control of assets to which the principal defendant is entitled. The purpose of such exceptional order is to prevent subsequent losses to the plaintiff applying for such order.
  1. Search Orders (Anton Piller) are a form of interim injunctive relief. It is an illuminating example of a without-notice application and the name derives from the case "Anton Piller KG v Manufacturing Processes Ltd''4. Cyprus Courts can issue interim orders requiring a party to admit another party to premises without notice for the purpose of preserving evidence, or property which is or may become the subject matter of the legal proceedings. The point is that if and once notice is given to the defendant, evidence may be destroyed or concealed. Therefore, the purpose of Anton Piller orders is to preserve evidence.

Precisely, the Anton Piller Search Orders can be requested by a Party to:

  • Discover and preserve evidence against the defendant which is in the possession of the defendant and it is probable to be concealed or destroyed;
  • Identify and gather evidence against others who have been involved with the principal wrongdoer in the tortuous activities;
  • Prevent the respondent from warning others to destroy or conceal evidence;
  • Reveal further harm and damage to the applicant;
  1. An anti-suit injunction is another type of order that blocks an opposing party from initiating or continuing legal proceedings in another jurisdiction or forum.
  1. Quia timet is an injunction to prevent wrongful acts that have not been committed yet.

The Applicant must meet the following requirements:

  1. Injunctions can be issued by the Courts, on an ex-parte basis (without-notice application) to the Respondent, given that the Applicant proves to the Court that there is an element of urgency. Consequently, in the absence of the element of urgency, the Cyprus Courts cannot grant any injunction or interim order, without notice to the Respondent.
  2. Disclosure of all material facts and documents. The Applicant is obliged to disclose, fully and frankly all material facts, and documents, regarding the case, to the Court.
  3. The Applicant is obliged by the Cyprus legislation to file a counter-security so that to cover all losses to be caused, to the Respondent, due to the issue of injunctions or interim orders, in the case that at a later stage the Court detects that they were issued without any reasonable cause, or in a bad faith. The amount of such counter-security is within the discretion of the Court.

Cyprus Courts can issue worldwide interim orders provided that:

  • Either the Respondents, to whom the interim orders are addressed, are subject to the domiciled jurisdiction of the Cyprus' Courts; or
  • The assets to be freeze are within the jurisdiction of the Cyprus Courts;

Footnotes

1 Court of Justice Law (14/60), Section 32, http://www.cylaw.org/nomoi/enop/non-ind/1960_1_14/full.html , [In Greek], Accessed on 22 February 2017

2 Find the case here: https://www.i-law.com/ilaw/doc/view.htm?id=147409 , Accessed on 21 February 2017

3 Find the case here: http://www.bailii.org/uk/cases/UKHL/1973/6.html, Accessed on 21 February 2017

4 Find the case here: http://www.bailii.org/ew/cases/EWCA/Civ/1975/12.html , Accessed on 21 February 2017

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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