Introduction
When a party in legal proceedings is at risk of transferring, hiding, or diminishing assets, the court can intervene with a freezing order to preserve those assets. Also known as Mareva injunctions or asset preservation orders, freezing orders ensure that any judgment obtained will not be rendered ineffective due to the dissipation of assets.
At Boss Lawyers, we help clients navigate the complexities of freezing orders—whether you need to apply for one or defend against one.
What Is a Freezing Order?
A freezing order is a court-issued injunction that prevents a party from dealing with or disposing of their assets, either in Australia or overseas. It is governed in Queensland by Rule 260A of the Uniform Civil Procedure Rules 1999 (Qld).
These orders are particularly important when there is a risk that a party might:
- Withdraw funds from bank accounts.
- Transfer property or shares to third parties.
- Sell or dispose of valuable assets like real estate or vehicles.
The primary goal is to preserve assets so that any eventual judgment can be enforced.
When Can You Apply for a Freezing Order?
To obtain a freezing order, the applicant must demonstrate the following:
- A Good Arguable Case
The applicant must show there is a solid basis for their claim in court. - Risk of Asset Dissipation
There must be evidence that the other party (or a third party) may:- Remove assets from Australia or another jurisdiction.
- Diminish the value of assets or make them unavailable.
- Assets to Be Preserved
The applicant must show that the respondent has assets that need protection.
The Court considers the application carefully, as freezing orders are considered extraordinary remedies that impose significant restrictions on the respondent.
Types of Freezing Orders
- Ex Parte Freezing Orders
These are urgent orders granted without notice to the respondent. They are typically short-term and address immediate risks. - Interlocutory Freezing Orders
These are granted before a trial and remain in place until the court proceedings are resolved. - Ancillary Orders
Freezing orders often come with additional orders, such as a requirement for the respondent to disclose the nature, value, and location of their assets.
Defending Against a Freezing Order
If a freezing order has been made against you, it is possible to defend or vary the order. Common defences include:
- Providing Security: Offering sufficient funds, a bank guarantee, or other security to satisfy the anticipated judgment.
- Applying to Discharge or Vary the Order: If the freezing order is excessive, unfair, or unnecessary, you can apply to have it lifted or adjusted.
- Challenging the Basis of the Application: Arguing that the applicant has not demonstrated a good arguable case or a genuine risk of dissipation.
Freezing orders do not give the applicant priority over other creditors, so they must be carefully managed, particularly in insolvency situations.
The Risks of a Freezing Order
While freezing orders are powerful tools, they come with risks for the applicant. If the order is found to have been wrongly obtained, the applicant may be liable to compensate the respondent for any losses suffered.
Applicants must also provide an undertaking as to damages, meaning they promise to compensate the respondent for any harm caused by the order if it turns out to be unjustified.
Why You Need Expert Legal Advice
Freezing orders are complex, urgent, and high-stakes legal tools. Whether you are seeking to preserve assets or defending against an application, professional legal advice is essential. At Boss Lawyers, we assist clients by:
- Preparing and presenting freezing order applications to the court.
- Advising respondents on defending, varying, or complying with orders.
- Ensuring that freezing orders are obtained or resisted efficiently and effectively.
Conclusion:
Freezing orders are a critical mechanism for protecting assets during legal disputes. Whether you need to safeguard your interests or defend against such an order, understanding the legal requirements and risks is vital.
At Boss Lawyers, we provide clear, practical advice to help you achieve the best outcome in complex asset preservation matters.
Contact Us Today
If you need assistance with freezing orders or asset preservation, contact our team for expert legal support.
