Law Report: Right to Mareva injunction upheld: Mercantile Group (Europe) AG v Aiyela and others. Court of Appeal (Sir Thomas Bingham, Master of the Rolls, Lord Justice Steyn and Lord Justice Hoffmann), 30 July 1993

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Although the right to an interlocutory injunction could not exist in isolation but was incidental to and dependent upon the enforcement of a substantive right, that substantive right need not necessarily take the form of a cause of action. It could take the form of a judgment debt owed by a third party, in whose arrangements for evading enforcement the defendant was involved.

The Court of Appeal dismissed an appeal by Mrs Remi Aiyela against the refusal by Mr Justice Hobhouse to discharge (a) an order requiring her to provide financial information about herself and her husband, Victor Aiyela, and (b) a Mareva (asset- freezing) injunction against her in respect of certain bank accounts.

Both orders were made after an action by Mercantile Group (Europe) AG against Mr and Mrs Aiyela had been compromised and judgment entered against Mr Aiyela.

Martin Mann QC and Mark Warwick (Lucas Baron Jacobs, Walthamstow) for Mrs Aiyela; Mark Barnes (Lovell White Durrant) for the plaintiff.

LORD JUSTICE HOFFMANN said Chief Aiyela was a man of influence in Nigeria. He was able to negotiate lucrative contracts for foreign corporations. In return he was paid large commissions.

In 1983, he negotiated an oil contract on behalf of the plaintiff, who put him in funds to pay the purchase price. But he was not satisfied with his commission. He paid only part of the purchase money to the sellers. He kept the remaining dollars 1.8m for himself.

In 1984, the plaintiff began proceedings against him and joined his wife and certain companies he controlled. These proceedings were compromised. Mr Aiyela admitted liability and undertook to pay dollars 2.2m by 5 November 1990. If the money was not paid, judgment could be entered forthwith. The plaintiff abandoned its action against the other defendants, including Mrs Aiyela. Mr Aiyela only paid dollars 338,000 and in February 1991 the plaintiff entered judgment against him. It then tried to enforce it. Mr Aiyela, continuing to live a life of luxury in a big house with servants and motor cars in St George's Hill, Weybridge, Surrey, did not co-operate.

The plaintiff then obtained Mareva injunctions, first against Mr Aiyela and then against his wife.

Mrs Aiyela argued that since the case against her had been abandoned, there was no jurisdiction either to make a Mareva injunction against her or to require her to disclose financial information about her or her husband's assets.

In his Lordship's judgment, however, there was prima facie evidence that Mrs Aiyela had become 'mixed up' in her husband's arrangements to defeat execution of the judgment. It followed from the decision of the House of Lords in Norwich Pharmacal Co v Customs and Excise Commissioners (1974) AC 133, that there was jurisdiction to make a disclosure order against her.

Nor did the fact that there was no substantive cause of action against her preclude a Mareva injunction. The doctrine in The Siskina (1979) AC 210, upon which Mrs Aiyela relied, was said by Lord Mustill in Channel Tunnel Group Ltd v Balfour Beatty Construction Ltd (1993) 1 AC 262 to be no higher than that 'the right to an interlocutory injunction cannot exist in isolation, but is always incidental to and dependent on the enforcement of a substantive right, which usually although not invariably takes the shape of a cause of action'.

Here, the plaintiff's substantive right was a judgment debt owed by Mr Aiyela. The Mareva injunction against Mrs Aiyela was incidental to and in aid of the enforcement of that right. Accordingly, there was jurisdiction to grant the Mareva injunction against Mrs Aiyela, who did not need to be joined because she was already a party to the action. The fact that it had been stayed by the compromise order was not for this purpose material.

SIR THOMAS BINGHAM MR and LORD JUSTICE STEYN gave concurring judgments.

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