Slovakia
1. Are freezing orders (or their equivalent referred to below) available in civil legal proceedings in this jurisdiction and what is their effect?
Yes. The respondent is prohibited from dealing with the assets referred to in the freezing order until a specified time (for example, a further hearing, judgment or payment) or further order of the Court.
2. Are other interim orders commonly made in conjunction with a freezing (or equivalent) order?
Yes. The Court must, instead of making a freezing order, create a temporary pledge over the assets of the respondent if there is a threat that future enforcement may be endangered. Such interim decision has a priority over the regular freezing order. The respondent may dispose with his/her assets; however, since the assets are secured by the judicial pledge, there is very low probability that assets will be transferred to the third person (since the judicial pledge will apply to the third person as well).
3. Briefly what is the relevant legal test?
(i) The applicant has a good arguable case in the underlying substantive claim or prospective claim;
(ii) the respondent has assets, which may be seized;
(iii) there is a real risk of unjustified dissipation (for example, for the purposes of frustrating or impeding the satisfaction of a judgment or award) that endangers the future enforcement process;
(iv) the restriction imposed by the freezing order on the respondent is proportionately equivalent to the rights of the applicant;
(v) it is not possible to create the judicial pledge over the assets of the respondent; and
(vi) it is just and convenient to grant the freezing order to protect existing right of the applicant.
4. Briefly what is the process for obtaining a freezing (or equivalent) order?
The applicant makes a written application to the Court, in particular setting out the reasons for the application and the basis on which the relevant test is met. If all legal conditions are met, the Court will make the freezing order without an oral hearing and without prior notice to the respondent. The freezing order is effective once it is issued, and potential appeal by the respondent does not alter the effectiveness and enforceability of the freezing order (unless and until it is cancelled by the appellate Court).
5. Does the applicant have to provide any form of security or commit to compensation if its claim is ultimately unsuccessful and any freezing (or equivalent) order granted causes loss and damage to the respondent?
Yes. The applicant is liable for any damages caused to the respondent by the freezing order.
6. Can it be sought against third parties?
Yes, a third party to the underlying proceedings or prospective proceedings may exceptionally be made a party to a freezing order, although the case law is not consistent on this question. A freezing order may not affect a person who is not a party to the freezing order.
7. What assets are covered by a freezing (or equivalent) order?
Any tangible or intangible assets provided they are not perishable and cannot be subject the judicial pledge.
8. Can a freezing (or equivalent) order be made in support of substantive proceedings abroad?
No.
9. Can a freezing (or equivalent) order be made in support of arbitration proceedings or awards?
Yes, however only the Court (not the arbitration tribunal) can issue such freezing order.
10. At what stage of proceedings can a freezing (or equivalent) order be sought?
At any stage, including prior to commencing the claim (although the Court will expect the applicant to issue its claim promptly) or following judgment to assist with enforcement.
11. Are there typically any exceptions to the general prohibition on the respondent’s use of assets subject to a freezing (or equivalent) order?
The freezing order will always specify what specific assets are subject to the freezing order, i.e. it cannot apply to a respondent’s assets as a whole. The freezing order must be proportionate regarding scope of the assets. The same applies to a judicial pledge over a respondent’s assets.
12. What happens after a freezing (or equivalent) order is granted?
The applicant will typically notify third parties (such as banks) of the freezing order when they might hold the respondent’s assets. Freezing orders are typically challenged by the respondent on appeal. The appellate proceeding is only in writing and the freezing order is effective regardless of the appellate proceedings – unless and until the appellate Court cancels the freezing order.
13. Who pays the costs of the application for a freezing (or equivalent) order?
Either the applicant or the respondent may be ordered to pay for the costs of obtaining the freezing order, which is usually decided at the final determination of the underlying litigation.
14. What protections are there typically in a freezing (or equivalent) order for third parties to such orders?
Freezing orders against the third parties are quite rare, since there is no consensus on whether a third party may be subject to the freezing order. Once the freezing order is issued, the only recourse available to a third party is to appeal against it and wait for the decision of the appellate Court.
15. What are the consequences of breach of a freezing (or equivalent) order?
A respondent who disobeys a freezing order may be imprisoned or fined. Any transfer of the frozen assets is invalid.
16. Does a third party notified of (but not a party to) a freezing (or equivalent) order owe a duty of care to the applicant (meaning it can be liable to the applicant for non-compliance)?
No.
17. Can a freezing (or equivalent) order be enforced abroad?
Yes, in principle, although subject to the laws of the relevant jurisdiction. However, this can only be sought with the permission of the Court and enforcement itself will be a matter of local law.
18. Can freezing (or equivalent) orders from overseas jurisdictions be enforced in this jurisdiction?
In general, no (except for freezing orders (or their equivalent) made in EU and certain EFTA).
Contact
Mgr. Ján Macej Senior Associate Eversheds Sutherland advokátska kancelária, s.r.o. Bratislava, Slovakia jan.macej@eversheds-sutherland.sk www.eversheds-sutherland.com/sk/slovakia
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