Recently I had a client ask me why I couldn’t freeze a bank account that contained disputed funds. My client’s logic was sound – he wanted to prevent the other side, who had sole access to the account, from wasting the funds in it.<\/p>\n
Our legal system has its roots in English \u201ccommon law\u201d from the Middle Ages. Technically, there are two types of relief \u2013 \u201clegal\u201d and \u201cequitable\u201d. A \u201clegal\u201d remedy means exactly one thing \u2013 the payment of money. In other words, upon the conclusion of the case, if plaintiff prevails at trial, plaintiff will have a judgment against defendant for the payment of a certain sum of money. It will then be up to us to collect that sum.<\/p>\n
An \u201dequitable\u201d remedy is anything other than the payment of money. So for example, if we were talking about a dispute over a sales contract for a parcel of land, the Court could compel the conveyance of that parcel of land \u2013 that would be an equitable remedy. Another example of an equitable remedy is an injunction, which is a Court order prescribing that a certain thing be done, or not done.<\/p>\n
In the case of a dispute between two owners of a company over the ownership of the assets of that company, plaintiff might ask for (for example) an injunction in the form of \u201can order enjoining defendant from retaining any assets which belong to the company and further requiring defendant to restore to the company those assets which he has converted to his own use, on an interlocutory basis to preserve the status quo of the parties\u201d. The word \u201cinterlocutory\u201d means \u201ctemporary\u201d, in other words, do it now, rather than waiting for the final trial.<\/p>\n
This is the means by which a bank account can be \u201cfrozen\u201d. The plaintiff’s lawyer does not have the ability to do this; only the Court can grant such an order. The Court would have to set a hearing on such a matter, but quite frankly I doubt the Court would do so in most cases, because the Court is unlikely to perceive an \u201cemergency\u201d with respect to freezing a bank account.<\/p>\n
It is understandable why the plaintiff might be frustrated here \u2013 if the defendant doesn\u2019t have access to the money, he can\u2019t spend it. But the Court isn\u2019t going to automatically take the plaintiff’s side here. Imagine if it did \u2013 anyone could make a claim against anyone else, even a totally specious claim, and all of a sudden his account is \u201cfrozen\u201d. The law simply doesn\u2019t work like that.<\/p>\n","protected":false},"excerpt":{"rendered":"
Recently I had a client ask me why I couldn’t freeze a bank account that contained disputed funds. My client’s…<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"wds_primary_category":0,"footnotes":""},"categories":[7],"tags":[32],"acf":[],"_links":{"self":[{"href":"https:\/\/dunhamlegalgroup.com\/wp-json\/wp\/v2\/posts\/163"}],"collection":[{"href":"https:\/\/dunhamlegalgroup.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/dunhamlegalgroup.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/dunhamlegalgroup.com\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/dunhamlegalgroup.com\/wp-json\/wp\/v2\/comments?post=163"}],"version-history":[{"count":0,"href":"https:\/\/dunhamlegalgroup.com\/wp-json\/wp\/v2\/posts\/163\/revisions"}],"wp:attachment":[{"href":"https:\/\/dunhamlegalgroup.com\/wp-json\/wp\/v2\/media?parent=163"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/dunhamlegalgroup.com\/wp-json\/wp\/v2\/categories?post=163"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/dunhamlegalgroup.com\/wp-json\/wp\/v2\/tags?post=163"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}