Freezing Injunctions – a practical guide

Freezing orders (or injunctions) are urgent court orders that prevent individuals or entities from selling, transferring, or hiding assets (e.g., bank accounts, property) to ensure they remain available for a potential judgment.

Freezing orders operate as a temporary “financial stranglehold” rather than a permanent seizure of property.

Often granted “without notice” to prevent asset disposal, they require applicants to prove a “real risk” of dissipation and provide a “full and frank disclosure”. 

Key Types

Domestic Freezing Order: Applies only to assets within a specific jurisdiction, such as England and Wales.

Worldwide Freezing Order (WFO): Restrains the respondent’s assets globally, regardless of where they are held.

How Freezing Orders Work 

Purpose: To preserve assets up to the value of the claim until a final court judgment is made. The order prohibits the respondent from selling, transferring, or moving assets—such as bank accounts, property, shares, or vehicles.

Scope: They can cover assets within the jurisdiction (England and Wales) or globally (Worldwide Freezing Order).

What you need to show

Good Arguable Case: You must show a strong substantive claim against the respondent.
 
Real Risk of Dissipation: There must be solid evidence that the respondent is likely to hide or waste assets to avoid paying.

Full and Frank Disclosure: you must tell the court everything, including facts that might help the respondent’s case.


Cross-Undertaking in Damages: you must provide a binding undertaking to compensate the respondent for any losses if the court later decides the order should never have been granted. 

Process

Application: an application is made to the court, often “without notice” to prevent a “tipping off” effect where the respondent quickly moves assets after hearing about the application. The court often grants the order in a private, one-sided hearing
 
Evidence: you must show a good, arguable case, solid evidence of risk, and that the order is proportionate.

Undertaking in Damages: you must promise to compensate the respondent if the court later finds the order was unnecessary or unjustified.

Order & Disclosure: The court grants an interim order, and the respondent must usually disclose a list of assets within a short timeframe (e.g., 48 hours). Once granted, the order is served on third parties like banks. The bank must immediately freeze the respondent’s accounts to avoid being in contempt of court.

Return Date: A second, “on notice” hearing is scheduled (within 7-14 days) to allow the respondent to defend themselves and seek to discharge the order. 

Key Limitations and Exemptions 

Living Expenses: The order typically allows the respondent to pay for reasonable living expenses (often around £500-£1000 or equivalent in any other currency)

Legal Fees: Payments for legal advice and representation are usually permitted.

Ordinary Business: Legitimate business dealings in the ordinary course of trade may still be allowed.

 

Consequences of Breach

Breaching a freezing order is considered contempt of court, which can lead to fines, seizure of assets, or even imprisonment. Third parties, such as banks, must also comply once notified to avoid liability. 

Contempt of Court: A deliberate breach is treated as a severe matter of contempt, allowing the court to act to uphold the administration of justice.

Imprisonment: Individuals (directors, individuals, or trustees) can face up to two years of imprisonment.

Financial Penalties: Fines can be imposed in unlimited amounts.

Asset Seizure/Sequestration: The court can order that assets be taken or placed in control of a receiver.

Adverse Inferences: The court may assume the worst about the breach, hurting the defendant’s position in the underlying legal case.

Costs Orders: The breaching party is likely to be ordered to pay the legal costs of the application regarding the breach.

Criminal Liability: In narrow, serious circumstances, breaching an injunction can lead to criminal prosecution. 

Risks and considerations

An application for a Freezing der is not something to be undertaken lightly. As well as advising you on the benefits of applying for the order, we will also advise you on potential pitfalls, allowing you to make  an informed decision.

Financial Costs

The “upfront” cost of a freezing order is significantly higher than standard litigation due to the speed and intensity required.

Legal Fees: Because the application requires a massive amount of evidence gathered in a very short window (often days), solicitor and barrister fees can range from £20,000 to over £100,000 just for the initial application.

The Return Date: You must pay for a second hearing (usually 7–14 days later) where the respondent will likely have hired their own aggressive legal team to overturn the order.

The Cross-Undertaking in Damages (The Biggest Risk)

This is the most significant “hidden” risk. To get a freezing order, you must give a binding promise to the court to pay for any losses the respondent suffers if the order is later found to be unjustified.

Business Interruption: If you freeze a company’s accounts and they lose a major contract or go bankrupt because they couldn’t pay suppliers, you may be held liable for those lost profits.
Asset Depreciation: If you prevent the sale of a volatile asset (like shares or crypto) and the value crashes while the freeze is in place, you may have to pay the difference.
Security for Costs: In some cases, the court may require you to put a large sum of money into a court-controlled account upfront as “security” to prove you can pay these potential damages.

Procedural Risks

The court sets a very high bar for the applicant’s conduct. Failure to meet these can lead to the order being cancelled and the applicant being penalised.

Duty of Full and Frank Disclosure: Since the first hearing is “without notice” (the respondent isn’t there), you have a duty to tell the judge everything—including facts that weaken your case. If you hide a piece of evidence that helps the respondent, the judge will likely discharge the order immediately and may order you to pay “indemnity costs” (the highest level of legal fees).
The “Draconian” Label: Judges view these orders as a last resort. If the court feels you are using the order as a “tactical weapon” to bully the respondent rather than a genuine attempt to preserve assets, they will strike it out.

Enforcement Risks

Even if you get the order, it is not a guarantee of payment.

Empty Pockets: You might spend £50,000 to freeze accounts only to find they are already empty or heavily overdrawn.

Prioritised Creditors: A freezing order does not give you “ownership” of the money. If the respondent goes into liquidation, you are still just an unsecured creditor behind the tax office and secured banks.