Alexandros Papantoniou, on behalf of Papantoniou & Papantoniou LLC, successfully defended two Cyprus-based companies against an application for interim freezing and disclosure orders exceeding €250,000, brought by a foreign supplier in the context of an alleged unpaid commercial debt.
The District Court of Nicosia dismissed the application in full, concluding that the strict requirements for the issuance of such intrusive relief were not been satisfied.
On behalf of our clients, we relied on leading English and Cypriot authorities to emphasise the high legal threshold for obtaining freezing relief. In particular:
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We highlighted that a real risk of unjustified dissipation, judged objectively, must be established through solid evidence, not mere suspicion, anxiety, or generalised assertions (Thane Investments Ltd v Tomlinson [2003] EWCA Civ 1272; Third Chandris Shipping v Unimarine SA [1979] QB 645; Lakatamia Shipping Co Ltd v Morimoto [2019] EWCA Civ 2203).
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We cited Z Ltd v A-Z [1982] QB 558, where the English Court of Appeal clarified that freezing orders are justified only in exceptional cases where there is a concrete risk that a defendant will make itself “judgment-proof” by concealing or removing assets, not merely continuing to conduct business in the ordinary way.
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We further invoked the guidance from Bean on Injunctions (15th ed., 2024) and reaffirmed that such orders must be framed to result in the minimum interference with the respondent’s rights, and must not be used as leverage for settlement or as a substitute for a security judgment.
The Court accepted these arguments and held that the applicant failed to demonstrate a sufficient evidential basis for the relief sought. It found that the allegations of risk were not supported by credible facts and that no exceptional circumstances existed to justify freezing orders of this kind.
Legal costs were awarded in favour of our clients.
This outcome reinforces the principle that interim asset-freezing measures will only be granted where compelling, objective evidence of imminent dissipation exists thereby preserving the balance between judicial protection and commercial freedom.