Most Popular Article in British Virgin Islands, November 2016
In UVW v XYZ (27 October 2016), the BVI Court gave an
important judgment in relation to the obligations of a registered
agent to provide third party disclosure to assist a foreign
judgment creditor trace assets. This judgment is a broadening of
the Norwich Pharmacal jurisdiction. It will enable a judgment
creditor who has no evidence of misuse of a specific corporate
structure but who can evidence a general pattern of wilfully
evasive conduct by the judgment debtor, as opposed to a mere
failure to pay, to obtain third party disclosure in support of
asset tracing or execution. This is a powerful new weapon in the
BVI Court's armory and is a sign of the jurisdiction's
determination to assist foreign judgment creditors in appropriate
The applicant was a foreign judgment creditor seeking general
information as to the assets of the judgment debtor. The judgment
debtor had been subject to an overseas freezing injunction with
which he had failed to comply and had been held in contempt of
court for failing to provide disclosure of his assets. The
applicant believed that the BVI registered agent had information
regarding the beneficial owner's assets and, in the light of
the non-compliance with the freezing injunction, that the
beneficial owner was using BVI companies to conceal his assets. The
applicant therefore sought disclosure from the registered agent in
order to police the freezing injunction, to discover assets the
judgment debtor may have concealed with BVI corporate vehicles
registered with the same corporate service provider, and to
discover possible leads for asset tracing or execution efforts.
While the respondent registered agent remained neutral –
caught between its duty of confidentiality and its duty of
disclosure under any Court Order – it properly sought to test
the application and raised a number of important arguments for the
Mr Justice Gerhard Wallbank held that Norwich Pharmacal relief
post judgment in aid of enforcement was in principle available (a)
where there is reasonable suspicion for believing that a disclosure
defendant is mixed up in the wilful evasion of another's
judgment debt and (b) to assist in securing compliance with
freezing orders, domestic and foreign.
The English Court of Appeal in NML Capital Ltd v Chapman
Freeborn Holdings et al  1 CLC 968 had doubted whether
jurisdiction existed post judgment, in relation to assisting a
judgment creditor, save in very particular and restricted
circumstances. In essence, the English Court expressed the view
that, in the case of a judgment creditor, a Norwich Pharmacal could
only be obtained against an innocent third party if there was
cogent evidence of wilful evasion by the judgment debtor.
Mr Justice Wallbank, in holding that there was jurisdiction post
judgment, decided that it was not necessary to identify a specific
transaction where the alleged wrongdoer had transferred assets to
the BVI corporate vehicle for no reason other than to avoid
execution. It was sufficient if the applicant could show there was
evidence of a deliberate effort to obstruct or frustrate
enforcement such that it would support a reasonable suspicion of
He held that there was no distinction between a company which
was created for the purpose of concealing assets wrongfully, and a
company which was created for a legitimate purpose and which then
evolved into something used wholly or partially illegitimately. The
mere fact of being a registered agent for a corporate was
sufficient to make a finding that a registered agent was involved
(or "mixed up") in the company's affairs even if the
registered agent does not know what the company is being used
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.
To print this article, all you need is to be registered on Mondaq.com.
Click to Login as an existing user or Register so you can print this article.
On 10 November 2014 the Privy Council handed down judgment in Singularis Holdings Limited v PricewaterhouseCoopers , which was heard alongside PricewaterhouseCoopers v Saad Investments Company Limited.
After the decision of the Privy Council in April 2014, the long running Fairfield Sentry case continued today with the new judgment of Leon J. concerning the status of the related US Bankruptcy Court proceedings.
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).