1. IDENTIFYING ASSETS IN THE JURISDICTION

1.1 Options to Identify Another Party's Asset Position

In Cayman Islands litigation, there is no general obligation upon a party to disclose their asset position, and publicly available information is limited.

There are central ownership registers for land, ships, aircraft and motor vehicles, but not for other types of movable or immovable property. Information contained in company share registers, and in the newly introduced beneficial ownership register, is not publicly available.

However, the Cayman Islands courts will, in appropriate cases, make asset disclosure orders in support of freezing injunctions. Likewise, there is a well-established and flexible jurisdiction to grant Norwich Pharmacal and Bankers Trust relief in order to obtain information from an innocent party who has become "mixed up" in wrongdoing. The respondents to such applications in the Cayman Islands are typically banks and corporate services providers.

Once a judgment has been obtained, it is possible to examine the judgment debtor as to their assets, as discussed in 2.4 Post-judgment Procedures for Determining Defendants' Assets.

2. DOMESTIC JUDGMENTS

2.1 Types of Domestic Judgments

A wide range of judgments and orders are available in the Cayman Islands, reflecting the diverse range of international and domestic cases before the courts.

Judgments may be obtained by default (if, for example, a defendant fails to respond to a summons), summarily (that is, without a trial) or following a contested trial.

The available juridical remedies broadly correspond to those available in England and Wales, and include the following.

  • Legal remedies, such as an award of compensatory monetary damages.
  • Equitable remedies such as:

  • (a) specific performance;

    (b) injunctive relief (including freezing and proprietary injunctions);

    (c) account of profits;

    (d) constructive trust;

    (e) restitution;

    (f) rescission; and

    (g) rectification.

  • Declaratory relief, whereby the court determines the rights, duties or obligations of one or more parties to a dispute without ordering damages or requiring further action.

To place this in context, the litigation landscape includes major substantive claims pursued by writ action in the specialist Financial Services Division of the Grand Court and the Cayman Islands Court of Appeal. For example, in recent years the Cayman Islands courts have heard an approximately USD2 billion claim brought by a Madoff feeder fund against its custodian/administrator (the Primeo litigation) and an approximately USD9 billion fraud claim involving a series of Cayman Islands companies connected to Saudi Arabia (the Saad litigation).

The Financial Services Division also hears all insolvency proceedings in respect of Cayman Islands companies and exempted limited partnerships, which are typically investment vehicles for hedge fund and private equity structures. The primary available relief is a winding-up order placing a company into official liquidation and appointing liquidators (although, if the grounds for a just and equitable winding-up are established, the court may, in its discretion, grant alternative remedies). If the company is wound up, the company's liquidation will be supervised by the court, which will, for example, determine applications brought by the liquidators for sanction to exercise certain powers, such as their power of sale of the company's assets.

The Cayman Islands also has a well-developed provisional liquidation regime, which provides a means for a distressed company to seek protection from creditor claims while court-appointed provisional liquidators promote (or supervise the directors in promoting) a compromise or arrangement with creditors.

Another notable stream of Cayman Islands litigation concerns the statutory merger regime, pursuant to Section 238 of the Companies Law. In summary, this regime permits a dissenting shareholder to seek "fair value" for its shares rather than receive the price otherwise payable under the merger agreement. Such litigation is heavily contested, involving expert evidence as to the value of the shares in question, and it will result in a judgment according to the court's findings about the fair value of those shares.

The courts also have a jurisdiction to grant a variety of free-standing interlocutory relief in certain cases, such as freezing orders in aid of foreign proceedings and anti-suit injunctions to restrain foreign proceedings brought vexatiously or in breach of contract.

Finally, the courts will determine the costs of the proceedings, generally on the basis that the loser shall pay the winner's costs. Costs are taxed (assessed), if not agreed, following the conclusion of the proceedings.

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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.