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Primary Produce Exports Ltd v Lauti [1995] TongaLawRp 4; [1995] Tonga LR 162 (14 November 1995)

[1995] Tonga LR 162

IN THE SUPREME COURT OF TONGA

PRIMARY PRODUCE EXPORTS LTD

V

LAUTI & ORS

Supreme Court, Nuku'alofa
C928/95

Lewis J

9, 10, 11-13, 14 November 1995

Injunctions - interim - discharge - Mareva injunctions - principles

Practice and procedure - interim injunctions - discharge - Mareva injunctions

This was an application to discharge an interim injunction granted urgently. It involved contracts in relation to the supply of squash seeds, fertilizers and chemical, the growing of squash and the sale and export of squash, and allegations of a prima facie breach of contractual relationships.

Held:

1. All injunctions are subject to important legal safeguards designed to defeat overt and inordinate disadvantage by the sometimes cataclysmic effects of interim injunctive orders upon their subject, whose guilt of any unacceptable behaviour may be non-existent or impossible to establish. There is no rigid formula.
   
2. A court must be satisfied by the applicant for an injunction that there exists a serious question to be tried; where the balance of convenience lies; and where overall justice lies.
   
3. As to balance of convenience it may be better expressed as the balance of the risk of doing an injustice; and matters which may be looked at include whether damages would be a sufficient remedy, the relevant circumstances of the parties and the prevailing circumstances of the public interest.
   
4. Mareva injunctions are subject to even more stringent considerations. It operates in personam against a defendant and not in rem against their assets. It confers no property right. It turns on the probability of a potential judgment debtor dissipating assets before trial in order to have the advantage over a potential judgment creditor who would seek to execute against assets.
   
5. The prerequisites to a Mareva injunction are to demonstrate a good arguable case, that the defendant has appropriate assets in the jurisdiction, and that there is a real risk of dissipation of assets with an intent to deprive the judgment creditor of execution. The Court should weigh the risks in the same way that a prudent commercial operator would weigh them.
   

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