Asset disclosure order: new affidavit permitted (first one “not good enough”)

Acting Deemster Gough has handed down a judgment dealing with a freezing injunction and compliance with an asset disclosure order, in an ongoing high-value Spanish estate dispute.

Background

The Claimant, Carmen Patrocinio del Hierro Alonso (“Carmen”), claimed to have been appointed “universal heir” (equivalent to estate administrator), under her late father’s 1986 will.

D1, Eva Navarro Aguilera del Hierro (“Eva”), obtained possession under a later purported will and deed of acceptance, later declared null and void in Spain.

The Spanish Court ordered Eva to return the estate – said to have included “€23,053,708.30 in cash, securities and investment funds, together with approximately 120 urban and rural properties in Spain” – to Carmen, in her administrator capacity. The properties were recovered; not substantial liquid assets.

Carmen relied on evidence that, following the Spanish litigation becoming adverse to Eva, substantial funds were transferred from Spain to UAE and the Isle of Man. A Spanish judicial police report referred to: “possible transfers of approximately €17.58 million and to indications of asset concealment through companies and transfers abroad”.

D2, Brinda World Gestión, S.L (“Brinda”), was incorporated in Spain by Eva in 2015. Brinda was alleged to have been established or used to receive, hold or conceal estate assets.

A restraint order against Eva and Brinda, under POCA, remains operative, pending an appeal against its discharge. It extends to assets held by three local financial institutions in the name of either Defendant.

Carmen filed a claim, and interim relief application, against Eva and Brinda, in April 2026.

The claim seeks to enforce a Spanish judgment debt against Eva. Against Brinda, Carmen seeks an account and delivery up of estate assets; restitution for unjust enrichment; and a declaration that Brinda holds assets received from Eva referable to the estate on constructive trust.

A freezing order, obtained without notice in April 2026: “restrains both Defendants from removing from the Isle of Man, or dealing with, assets up to a value of €23,053,708.30. It also required both Defendants, to the best of their ability, to disclose their assets in the Isle of Man and confirm that disclosure by affidavit.”

The Manx institutions later identified assets or former accounts belonging to Eva, but no account or policy in Brinda’s name.

Eva’s affidavit, filed further to an asset disclosure order, swore to the effect that (see the judgment at § 18): “to the best of her recollection, the Manx policies and accounts were held in her personal name and no funds were held by Brinda”.

Brinda sought to discharge the freezing order on various grounds.

Freezing injunctions & asset disclosure orders – applicable principles

Acting Deemster Gough set out (at §§ 21-28) applicable principles.

“21. In Skatteforvaltningen (Danish Customs and Tax Administration) v Worldwide Asset Management Ltd [2024] MLR 328 (“SKAT”), Deemster Corlett confirmed that, on an application to discharge a freezing order, the Court considers the matter de novo. There must be a rehearing and the Court must be satisfied, on the material then available, that the requirements for freezing relief continue to be met.

22. Those requirements are well established. The Court must be satisfied that:

a. it has jurisdiction to grant the relief;

b. the Claimant has a good arguable case on the underlying claim;

c. there are sufficient grounds for believing that the respondent has assets upon which the order can operate;

d. there is solid evidence of a real risk that, without the order, assets may be dissipated so that a judgment goes unsatisfied; and

e. it is just and convenient to continue the order.

23. The Claimant bears the burden of satisfying those requirements. It is not for Brinda to prove that the order should be discharged.

24. Because the original application was made without notice, the Claimant was also subject to a duty of full and frank disclosure. The principles in Brink’s-Mat Ltd v Elcombe [1988] 1 WLR 1350 apply. An applicant must identify all material matters, including matters adverse to the application, and must make proper enquiries before seeking relief.

25. Whether any non-disclosure mandates discharge is a matter for the Court’s discretion, having regard to its importance, the explanation for it, the degree of culpability and the overall interests of justice…

26. The disclosure obligation is ancillary to, but distinct from, the freezing prohibition. Rule 7.16(1)(g)… expressly permits an order requiring information about the location of property or assets which are or may be the subject of a freezing injunction. Such disclosure is ordinarily necessary if the injunction is to be effective and capable of being policed.

27. In SKAT at [§§] 69 to 77, Deemster Corlett considered the competing prejudice arising from an asset disclosure order. Referring to VTB Bank PJSC v Sabadash and others (CHP 2018/13, 1 March 2018) and Motorola Credit Corporation v Uzan [2002] EWCA Civ 989, he recognised the need to balance the prejudice to a defendant who is required to disclose assets when it is later held that disclosure should not have been ordered, against the prejudice to a claimant where disclosure is withheld but it is later found that it should have been given.

28. The first form of prejudice is real. Disclosure of financial affairs is intrusive and cannot necessarily be undone if the order is later discharged. The competing prejudice is that, without timely disclosure, a claimant may be unable to police an otherwise valid freezing injunction and assets may be removed before the entitlement to relief is finally determined. For that reason, the normal position is that disclosure ancillary to a freezing injunction is not stayed merely because the injunction is under challenge.”

Existence of assets & risk of asset dissipation

After holding that the ‘jurisdiction’ and ‘good arguable case’ limbs were met, Acting Deemster Gough turned to the ‘existence of assets’ and ‘risk of asset dissipation’. At § 61, he concluded:

“Standing back, the Spanish material connecting Brinda with alleged asset concealment, the breadth of the 2021 criminal restraint order, the manner in which the investments were arranged and the absence of proper contemporary enquiry provide grounds for believing that Brinda may have, or may control, assets or interests in this jurisdiction. The threshold is met, but only narrowly on the present evidence.”

He referred (at § 64) to a request made to a Manx institution on 11th December 2020 for seizure of Eva’s assets followed, on 17th December 2020, by the dismantling of a deposit account containing approximately € 740,000; and other balances also being transferred out within weeks of the Spanish order. He concluded at § 67:

“The risk is forward-looking, but past conduct is relevant where it forms a reliable basis for predicting what may occur if the ordered restraint is removed. Considering the evidence cumulatively, I am satisfied that the risk of dissipation is real and not merely fanciful.”

The restraint order

The Court next considered the impact of the extant restraint order, concluding (at §§ 71-72):

“71. SKAT confirms that a criminal restraint order and a civil freezing order may, in an appropriate case, operate alongside one another. The existence of the criminal restraint is relevant to necessity and proportionality, but is not a legal bar to a parallel civil freezing order.

72. While the criminal order continues it reduces the immediate opportunity for dissipation. The Claimant is nevertheless entitled to preserve her own position should that order cease to have effect. It would not be satisfactory to require her to await its discharge and then attempt to obtain urgent relief after the protection had disappeared.”

Material non-disclosure

The Court noted (at § 79) that the post-hearing confirmation, that the Manx institutions held no account or policy in Brinda’s name, should have been disclosed, pursuant to Carmen’s continuing disclosure duty. But Acting Deemster Gough concluded (at §§ 82-83):

“82. I am not satisfied that the original order was obtained through a material or culpable failure of full and frank disclosure such that the Court should discharge it and refuse relief irrespective of the merits.

83. Even if the omission to update the Court is regarded as sufficient to require formal discharge, I would, having considered the present evidence inter partes, grant the order afresh. A purely formal discharge and immediate re-grant would serve no useful purpose.”

(See the “Note for Practitioners”, below.)

Just and convenient

The Court was satisfied (at § 94) that it was “just and convenient” to continue the order against Brinda for now.

The Court noted that the order allowed the Defendants to deal with assets in the ordinary and proper course of business and included the usual reasonable legal expenses exception. A cross-undertaking in damages was in place, with the ability to fortify if necessary. Thus:

“93. The potential prejudice to the Claimant if the order is discharged and an undisclosed asset is removed is substantial. The prejudice to Brinda in maintaining the order for a limited period while proper enquiries are completed is comparatively modest. I do not overlook that disclosure itself is intrusive, but the balance discussed above favours completing reasonable and properly documented enquiries. Furthermore, the future of the Freezing Order may well lie in the hands of Eva. Her statement in her affidavit that she relied on memory to give evidence about Brinda’s assets is unconvincing.”

Asset disclosure – further affidavit

At § 96, the Court concluded:

“96… The assets in the jurisdiction requirement is satisfied only narrowly and Brinda must now consider whether it should better establish its position by proper, documented contemporary evidence. Eva’s evidence that her recollection is that Brinda has no assets in the Isle of Man is not good enough for this purpose especially considering her role within Brinda and the ease with which she could obtain information from the Dubai financial adviser who handled the management of the assets.

97. I therefore give Brinda leave to file and serve a further affidavit sworn by Eva… . To be effective any such affidavit might:

a. identify the Dubai financial adviser, broker and any other intermediary through whom the 2017 investments were arranged;

b. state what enquiries have been made to determine whether Brinda has or has had any legal, beneficial, contingent or other interest in any asset situated in the Isle of Man;

c. exhibit the material responses and documents received;

d. identify any other Manx institution through which an investment was made or held;

e. provide details of any asset formerly held by Brinda which has been transferred, redeemed or replaced; and

f. if the position remains that Brinda has never held any Manx asset or interest, confirm that fact on the basis of the enquiries undertaken rather than recollection alone.

98. If Brinda elects to comply with that suggestion it shall have liberty to renew its application…”.

Note for practitioners: Hierro Alonso illustrates the Court’s approach towards freezing injunctions and asset disclosure orders. For a review of law and practice in this area, see also Freezing Injunctions in the Isle of Man – Practice and Procedure | Coren Law. This update cites a recent English Court of Appeal decision on material non-disclosure, Astor Asset Management 3 Ltd & others v Pliego & another [2025] EWCA Civ 1060 (04.06.25). It is not clear whether Pliego was cited to the Court in Hierro Alonso. The Court of Appeal in Pliego held that the Court’s discretion to continue the injunction, or impose a new one, should only be “sparingly” exercised, in the case of a failure to disclose; the overriding consideration would: “always be the interests of justice” (see checklist at § 13, at point xii)). Whether there now is, at least, a difference of emphasis between the two Courts’ approaches, on the consequences of material non-disclosure, may yet emerge in future decisions.

Disclaimer: professional advice should be sought before applying any information in a given case.

For advice on Isle of Man civil procedure, or enforcement, contact Coren Law.

See also Coren Law’s Isle of Man civil procedure portal: Click On | Coren Law.