Protection for innocent third parties given by Jersey Royal Court

Bedell Cristin’s litigation team successfully argued for protection for innocent third parties in the context of pre and post-judgment disclosure orders before the Jersey Royal Court in two recent cases.

In a case referred to as Re The Brazilian Trust, Bedell Cristin successfully acted for Jersey Home Loans, which was joined as a party cited to existing proceedings so that an order could be made for disclosure of certain financial information in respect of a judgment debtor. The Royal Court ultimately found that in a case where an innocent third party was joined to proceedings (either before or after judgment) and was ordered to give disclosure of certain information, it should have protection from any and all costs, expenses or claims against it from anyone who might bring a claim as a consequence.

This decision by the Royal Court is significant as it confirms the standard of protection for innocent third parties in these types of cases. Going forward the applicants for disclosure orders must give what’s referred to as an ‘undertaking in damages’ to the Court which would mean that any risk the third party may be exposed to (in the form of potential claims, losses, damages, or associated costs) as a result of the disclosure order, are borne by the applicant.

In the second case, Riba Consultaria Empresarial Ltda. v PinnacleTrustees Limited, Bedell Cristin, represented the defendants Pinnacle Trustees Limited, in which the court amended the standard test for Norwich Pharmacal Relief, which is a particular type of disclosure order. This has now been amended so that the threshold for obtaining this type of disclosure order is lower, making it easier to obtain key evidence from a third party.

Commenting on the judgments, the Advocate in both cases Edward Drummond, said: “Both cases are now the leading decisions in their respective fields for third party disclosure orders. These clarifications by the Royal Court will not only serve to further protect innocent third parties in these types of cases but will also lower the threshold for gaining key evidence as well.”