Allied Irish Bank v Ashford Hotels Limited and Ashford Hotels Limited v Higgins; Tyree and Emblem Bv: CA 8 May 1997

The court asked itself whether it had power to require a cross-undertaking in favour of third parties as a condition of appointing a receiver.
Held: Phillips LJ: ‘The Mareva injunction is a comparatively recent addition to the armoury of the court. Having discovered the existence of, or some would say invented, this weapon, the court went on to invent the ancillary weapon of the cross-undertaking in damages for the benefit of third parties (see Z Ltd v A [1982] QB 558). In that case the cross-undertaking approved by the court was one designed to protect third parties from the consequences of compliance with the injunction but the scope of the protection of the undertaking has since been expanded to embrace third parties adversely affected by the injunction.
For myself, I cannot accept that the jurisdiction of the court to require such an undertaking only exists where a Mareva injunction is ordered. Once the cross-undertaking for the benefit of third parties became a recognised feature of the court’s jurisdiction in that context, it necessarily followed that the court could make use of it when granting other discretionary relief, at least where that relief was empowered under the same statutory provision.’

Judges:

Phillips LJ

Citations:

[1997] EWCA Civ 1635, [1997] 3 All ER 309, [1998] BCC 440

Links:

Bailii

Jurisdiction:

England and Wales

Cited by:

CitedSmithkline Beecham Plc and others v Apotex Europe Ltd and others PatC 26-Jul-2005
Application was made to join in further parties to support a cross undertaking on being made subject to interim injunctions.
Held: On orders other than asset freezing orders it was not open to the court to impose cross-undertakings against . .
CitedSmithkline Beecham Plc Glaxosmithkline UK Ltd and Another v Apotex Europe Ltd and others (No 2) CA 23-May-2006
The parties to the action had given cross undertakings to support the grant of an interim injunction. A third party subsequently applied to be joined, and now sought to take advantage of the cross undertakings to claim the losses incurred through . .
Lists of cited by and citing cases may be incomplete.

Litigation Practice, Jurisdiction

Updated: 06 November 2022; Ref: scu.142031