Commercial Pre-Emptive Remedies

Posted On: 11 August 2006

Author: Richard Aird

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The following is an extract of a paper delivered by Richard Aird at a Contract Law Masterclass organised by CLT which took place in London.

COMMERCIAL PRE-EMPTIVE REMEDIES

INTRODUCTION

WHAT IS A COMMERCIAL PRE-EMPTIVE REMEDY ?

A measure intended to preserve a factual or legal situation until the courts normal procedures can be invoked.

This means they are usually obtained as a matter of urgency.

As a by-product pre-emptive measures can  be a lethal tactical weapon which as experienced practitioners will attest frequently induces an early settlement.

English Examples? Freezing injunctions, Search Orders and orders for custody, preservation and inspection.

Scottish examples? Interim Interdict, Arrestment, Inhibition and the powers to carry out dawn raids to recover evidence under Administration of Justice (Scotland) Act 1972 which are undoubtedly the most powerful pre–emptive remedy of its type available in any Convention or EU Jurisdiction.

French Examples? La Saisie Conservatoir or La Saisie Vente – rather like the Scottish Arrestment.

German Examples? the Arrest – again rather like the Scottish Arrestment but requiring a high standard of proof or the Einstweilige Verfugung which has similarities with an injunction but also requires high standards of proof.

KEY ILLUSTRATION:

A, an Italian National, proceeds in Paris with jurisdiction under the Judgment etc. Regulations against B, a German National.

B's assets whether moveable or immoveable, tangible or intangeable,in the form of debts owed by trade debtors or credits held by banks whether directly held or held by third parties have the potential to be seized in.

ANY REGULATION JURISDICTION
To the extent provided by their internal law. This is known as Forum Dipping.

A choice of Jurisdiction Clause? Probably makes no difference.

Recent ECJ cases
Gasser v Misat Srl [2005] QB 1                   
- An Austrian exclusive Choice of Jurisdiction Clause did not prevent the Italian Courts from considering whether they had jurisdiction to grant a negative declaration

And ten years later…………………….?                               
                          
See also Turner v Grovit [2005] 1 AC 101 & Owusu v Jackson 2005   (C-281/02)