In AAA v BBB [2025] EWHC 1647 (Comm), the claimant obtained a worldwide freezing order against multiple defendants under section 44(2) of the Arbitration Act 1996 in aid of a Latvian-seated arbitration.
The defendants applied under CPR Part 11 challenging the jurisdiction of the Court and to set aside the freezing order. They did so on three principal grounds. The first was that an arbitration claim form, by contrast to ordinary Part 7 claim forms, is valid for service only for one month and that period had expired before the freezing order was obtained. The second was that there is no power under section 44(2) of the Arbitration Act to grant a freezing order against a non-party to the arbitration agreement. The third was that the claimant was in breach of his duty of full and frank disclosure in multiple respects.
The defendants’ applications succeeded in their entirety: the freezing order was discharged and the claimant was ordered to pay the defendants’ costs on the indemnity basis.
As to the first ground, Henshaw J held that the validity of an arbitration claim form issued under CPR Part 62 can be extended only under CPR 7.6(3) and that CPR 62.4(2) does not confer any freestanding power of extension on the court (alternatively any freestanding power is to be exercised by reference to the criteria set out in CPR 7.6): see paras 41-42. In this case, the validity of the claim form expired before the ex parte freezing order was obtained and there were no grounds for extending its validity retrospectively. Henshaw J also accepted the defendants’ case that the claimant was in breach of his duty to give full and frank disclosure and that the appropriate sanction for this breach was to discharge the order: see para 61.
That meant that the Court did not need to decide the second ground referred to above, namely whether there is power under section 44(2) to make a freezing order against a non-party. Henshaw J noted at [62] that the answer to this question turns on the effect and correctness of a number of authorities that suggest that there is no such power; and on whether to hold that there is nonetheless such a power would undermine the transitional provisions in the Arbitration Act 2025.
Niranjan Venkatesan KC and Moritz Grimm acted for the successful defendants, instructed by PCB Byrne LLP.
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