Freestream Aircraft Limited v Seven Hundred Limited & Ors [2026] EWHC 1596 (Ch)

[2026] EWHC 1596 (Ch)Case No BL-2025-001002
IN THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
BUSINESS LIST (ChD)
Venue Rolls Building, Fetter LaneDate 1 July 2026
London, EC4A 1NL
Before
NICOLA RUSHTON KC(Sitting as a Deputy Judge of the High Court)
FREESTREAM AIRCRAFT LIMITEDApplicant/Claimant
Between
SEVEN HUNDRED LIMITEDFirst Defendant
Between
MOONSHOT INVESTMENTS LIMITED (formerly THE JET BUSINESS (INTERNATIONAL) LIMITED)Respondent/Second Defendant
Between
STEVEN MARK VARSANOThird Defendant
Ms Lucy Colter KC and Ms Iona Branford (instructed by Boies Schiller Flexner (UK) LLP) for Applicant/ClaimantMr Richard Power KC (instructed by Grosvenor Law) for Respondent/Second DefendantHearing Hearing date: 22 June 2026
Approved Judgment
[1]This is an application for a domestic freezing injunction up to a limit of £1,850,000 sought by the Claimant (“Freestream”) against the Second Defendant (“TJB Old”), a company which until April 2026 was known as The Jet Business (International) Limited. The application is on notice, and was issued on 22 May 2026. This judgment follows a fully contested one-day hearing on 22 June 2026, at which Freestream was represented by Ms Lucy Colter KC and Ms Iona Branford, and TJB Old by Mr Richard Power KC. I am grateful to all counsel for their helpfully focused submissions.[2]All of the parties are, or were until very recently, involved in the private jet sales business. Freestream and TJB Old were rival brokers. Proceedings were issued by Freestream on 11 August 2025 against three defendants in connection with the sale of a Gulfstream G700 aircraft, on 2 May 2025, to two alleged affiliates of FXSolutions, LLC (“FXS”), a company in the Flexjet group (“Flexjet”). Flexjet is a large group of private aviation companies headed by Mr Kenneth Ricci.[3]Against the First Defendant (“SHL”) Freestream claims unpaid commission of US$837,500 on that sale, allegedly arising under a fee agreement between Freestream and SHL dated 11 November 2024 (“the Agreement”). SHL denies any commission was payable. Freestream’s claim against TJB Old and the Third Defendant (“Mr Varsano”) is for allegedly inducing SHL to breach that Agreement by not paying that commission.[4]In the context of a freezing injunction application, this is therefore a relatively modest claim, the balance of the sum sought to be frozen being interest and costs. It is also in substance a contractual claim and, as Ms Colter emphasised, does not include any allegations of dishonesty.[5]Both Freestream and TJB Old are companies registered in the UK, with established trading histories. Mr Varsano is the director and sole shareholder of TJB Old, which has effectively been his trading vehicle. He has a high profile in the private jet business, with several million TikTok followers.[6]Defences have been served, by SHL dated 29 September 2025, and by TJB Old and Mr Varsano dated 23 September 2025. There is an outstanding application by Freestream for amendment of its Particulars of Claim, and it is agreed that I should consider the present application by reference to the latest iteration of the proposed amended Particulars of Claim. TJB Old disputes that the claim against it is reasonably arguable, even on this version. On 17 October 2025 TJB Old and Mr Varsano issued an application to strike out the claim against them. That application was withdrawn on 13 May 2026, with Master Kaye recently concluding there should be no order as to costs. Given the outstanding amendment application, no Reply has yet been served by Freestream.[7]On 4 June 2026 Master Kaye ordered Freestream to give security in respect of SHL’s costs, the first tranche of £250,000 being payable by 2 July 2026.[8]The trigger for the freezing injunction application was Freestream’s discovery on 7 May 2026 that TJB Old had changed its name to Moonshot Investments Limited, and that a new company had been created called The Jet Business (International) Limited (“TJB New”). This proved to be in connection with the sale of the entirety of TJB Old’s brokerage business to FX Solutions Global Limited (“FXSG”), a newly incorporated company also in the Flexjet group. TJB New is owned by FXSG, and its directors are Mr Ricci and a Mr Rossi. Mr Varsano has taken up a new role as President in the Flexjet group.[9]On 8 May 2026, Freestream’s solicitors (“BSF”) wrote to TJB Old’s solicitors (“GL”) setting out what it had discovered from Companies House, seeking an explanation of the changes and details of any business sale, and seeking an undertaking that TJB Old would not remove from the jurisdiction and would ring-fence sale proceeds or assets of £1,850,000.[10]On 12 May 2026 GL replied, confirming that the name change was due to a sale of TJB Old’s business assets on 30 April 2026, but saying that TJB Old continued to trade and would be used as a “family office investment vehicle” by Mr Varsano. Mr Varsano’s evidence has further confirmed that the consideration for the sale was a combination of cash and Flexjet shares, that the cash element was all received by TJB Old into its UK bank account, where it remains, but that no further details of the transaction, which are commercially confidential, would be provided. The letter further explained, as expanded in Mr Varsano’s evidence, that Mr Varsano is nearly 70 and wished to sell his aircraft brokerage business, and that going forward TJB Old would “conduct investments in various sectors, including AI, technology, longevity and biotech”. TJB Old has refused to provide any further information as to its future investment intentions or any undertakings as to its use of the proceeds of sale, saying Freestream is not entitled to this.[11]TJB Old also relies upon a letter from its accountants, MGI Midgley Snelling LLP dated 28 May 2026, which states that they “confirm [TJB Old’s] net assets currently exceed USD10m”. It is implied though not expressly stated that the proceeds of sale comprise a large part of this.[12]On 12 June 2026 the sale was made public. A second witness statement from Mr Varsano exhibits various press statements announcing the sale, including from Forbes, and quoting Mr Varsano and Mr Ricci saying how pleased they are that The Jet Business has joined the Flexjet group. These press statements say that the terms of the deal have not been disclosed, and no price is mentioned.[13]TJB Old relies on witness evidence from Mr Varsano and also from Mr Ricci, as the purchaser. Among other things this is to the effect that the sale to Flexjet has been gestating since October 2024 (well before either the sale of the aircraft or this litigation), beginning with informal discussions between Mr Varsano and Mr Ricci and leading to more detailed discussions from June 2025. Mr Ricci says that fundamental points of the deal had been agreed by the end of 2025, with signature on 8 April 2026. No transaction documents have been disclosed.[14]Freestream’s evidence is primarily directed towards its discovery of the sale of TJB Old’s business, and the results of further enquiries made by it, as well as background to the claim itself. Its evidence also addresses the financial position of Freestream for the purposes of the cross undertaking in damages offered by it, providing more up to date evidence than that before Master Kaye on the security for costs application.[15]Ms Colter accepts on the basis of TJB Old’s evidence, and for the purposes of this application, that this was a bona fide, arm’s length sale which was not related to this litigation, was not a sham and was not undertaken with the aim of putting assets beyond the reach of creditors. As to whether the sale was at full value, she says Freestream did not know the value placed on TJB Old’s business or the value ascribed to the Flexjet shares (no details about the shares element have been given). On this point Mr Power submits that Freestream has not disputed that the sale was at full value, the burden of proving a prima facie case being on it.[16]Ms Colter contends that nevertheless the sale amounted to an unjustified dissipation of TJB Old’s assets, and that further, there is a serious risk of a future unjustified dissipation of its assets. This is based primarily on the liquid nature of the cash assets and the fact, I am told, that the shares are in a Delaware company against which it is said it would not be easy to enforce, combined with the fact TJB Old has no trading history for its new venture, and the unspecified and potentially risky nature of any future investments by it.[17]Mr Power says that this gives the game away that the real purpose of this application is to obtain security for a future judgment and/or exert pressure to settle. He says that if a freezing order were granted on facts like these, it would turn freezing orders from a nuclear option to being commonplace.[18]There is no dispute therefore as to the essential facts of what has taken place, at least for the purpose of this application; the dispute is as to the proper inferences and conclusions to be drawn from those facts.

The test for a freezing injunction

[19]It is agreed that for a freezing injunction to be granted, the applicant must satisfy the court that: i) There is a serious issue to be tried. (Following Dos Santos v Unitel SA [2024] EWCA Civ 1109, [2025] KB 438, this is the same test as “good arguable case” and is the preferred formulation). ii) There is good evidence of a real risk that a future judgment would not be met because of unjustified dissipation of assets by the respondent. iii) In all the circumstances, it would be just and convenient to grant the relief sought.[20]All three stages are disputed in this case, although the most significant dispute is as to risk of unjustified dissipation.[21]The burden of proof is on the applicant. In particular, in relation to risk of unjustified dissipation, unless the applicant has raised a prima facie case to support a freezing order, the respondent is not obliged to provide any explanation or answer to the applicant’s questions, and a purported failure to do so cannot be held against them. It is only if the applicant has raised material from which a real risk of dissipation can be inferred that the respondent will be expected to provide an explanation – Holyoake v Candy [2017] EWCA Civ 92, [2018] Ch 297 (“Holyoake”) at [50] – [51].[22]In this case, TJB Old’s position is that Freestream has failed to raise such a prima facie case of risk of dissipation, but that in any event, TJB Old has provided an explanation supported by good evidence which would fully rebut this.

Serious issue to be tried

[23]On the basis of the proposed amendments, Mr Power submits that Freestream has failed to establish that there is a serious issue to be tried, for three reasons (which I understand to still all be in play following the provision of the latest version of the proposed amendments). They are that: i) There is no properly pleaded case that the alleged inducement had some causative effect on SHL’s alleged breach. That this is a requirement is apparent from Kawasaki Kisen Kaisha Ltd v James Kemball Ltd [2021] EWCA Civ 33 at [33]: the defendant’s actions alleged to amount to inducement must have had sufficient causal connection with the breach to attract accessory liability, i.e. to amount to causative participation. SHL’s case in its Defence is that it did not pay the fee because it was not due. Mr Power submits that this means that Freestream will have to prove that SHL’s case is knowingly false, i.e. dishonest, but dishonesty has not been pleaded. He says that the alleged inducement cannot therefore have had any causative effect on Freestream’s case, and so the claim is doomed to fail. This was the main point pursued by Mr Power in his oral submissions, in response to the latest version of the amendments. ii) A breach of the Agreement by SHL must be proved as a pre-requisite. However no particulars have been provided of what Freestream did to coordinate and conduct the sale, and its case that it did is contradicted by its claim that it was cut out of the proposed sale three months before it happened. iii) Freestream’s alternative case is that the Agreement was terminated for repudiatory breach and it is entitled to a fee under clause 3 because the aircraft was sold within a year of termination to a prospect which Freestream had introduced. However, there is no effective plea of acceptance of that breach, which is a necessary element of that head of claim. The only plea of acceptance of the alleged repudiatory breach is via the statement of case itself, but that is after the alleged sale and so is not within clause 3 of the Agreement.[24]I was told that TJB Old had also disputed the application to amend on a fourth ground, which was whether it was reasonably arguable that TJB Old could have had knowledge of certain implied terms, for the purposes of inducement. That fourth ground of objection to Freestream’s proposed amended case was not pursued by Mr Power in his skeleton argument or orally on the present application, although he said it was not conceded that that amendment had a real prospect of success. Ms Colter said it was highly unsatisfactory that the point was not being brought forward now but might be revived later on an amendment application. However, since Mr Power put forward no argument on the point, I treat it as having been accepted as raising a serious issue to be tried for the purposes of the present application.[25]Ms Colter set out in some detail the basis of Freestream’s claim in its skeleton, but aside from the three points which I have set out above, it was not disputed by Mr Power that there is a serious issue to be tried. Those points were therefore the focus of Ms Colter’s oral submissions, as to which her position was: i) Freestream has pleaded among other things a key WhatsApp exchange on 23 April 2025 which clearly suggests that, at least at that time, SHL’s Mr Samee believed a fee would or might be due to Freestream if the proposed sale went ahead, and that no adequate reassurances were then received by SHL that there was no relevant connection between the buyers and FXS. Furthermore, knowing and deliberate inducement of a breach of contract has been pleaded. A causative connection is therefore pleaded and is reasonably arguable. While SHL has denied in its Defence any belief that a fee was due, Freestream can dispute this by way of Reply, which would be the correct way to do this. This is not a situation where Freestream is obliged to plead dishonesty or fraud; that is not an underlying matter constituting its claim and it is not necessary for Freestream positively to allege that SHL was dishonest in order to plead all the elements of its claim. ii) At least by the proposed amended Particulars of Claim, Freestream has provided particulars of Freestream’s actions taken to coordinate and conduct the sale, by cross-referencing to actions pleaded in earlier sections of the Particulars of Claim. iii) By a further proposed amendment Freestream has also now alleged that either party could unilaterally terminate the Agreement by conduct preventing the other party from performing it. SHL did this and so unilaterally terminated the Agreement by selling to an affiliate of FXS and cutting Freestream out of the deal. Freestream also pleads an implied term to a similar effect.[26]Ms Colter also submitted that Freestream had already satisfied the court that it had a good arguable case as to breach of the Agreement, because it had obtained permission to serve the claim out of the jurisdiction as against SHL (which is resident in the BVI). She submitted that it was therefore an abuse of process for TJB Old to attempt to relitigate this issue (relying on the test summarised in Allsop v Banner Jones Ltd [2021] EWCA Civ 7, [2022] Ch 55 at [44]). I reject this submission. I do not consider that it is abusive for TJB Old now to dispute the issue on this freezing injunction application where not only was the application to serve out made against another party, but by definition it was made without notice to any defendant.[27]On the substance of the points which are in dispute before me, however, my conclusion is that Freestream has established that there is a serious issue to be tried, based on its latest draft amended Particulars of Claim, for the following reasons: i) It has pleaded a positive case as to why SHL’s agent would have believed at the relevant time, when the alleged facts amounting to inducement took place, that SHL would or might be liable to pay Freestream a fee on the proposed sale. There is therefore a good arguable case that the alleged inducement had a causative effect when SHL decided not to pay a fee, without it being necessary for Freestream to plead that SHL has acted dishonestly in refusing to pay a fee. Such dishonesty is not a necessary element in Freestream’s cause of action, which is what matters, whether or not a court ultimately decides any witness is not giving honest evidence. This is therefore sufficiently pleaded. ii) By cross-referencing to the pleading of the actions taken by Freestream earlier in the Particulars of Claim, particulars have now been provided of Freestream’s alleged actions to coordinate and conduct the sale. The relevant facts themselves had in any event already been pleaded, so this was at best a technical point. iii) The new alternate plea of unilateral termination by rendering it impossible for Freestream to perform the Agreement is reasonably arguable. However the plea of acceptance of the repudiatory breach by the Particulars of Claim themselves is not, since clause 3 provides that any sale must be within one year “following” the termination, and the sale would have been before the termination in that scenario.

Risk of unjustified dissipation

[28]Ms Colter relied on TTMI Ltd of England v ASM Shipping Ltd of India [2005] EWHC 2666 (Comm) at [25] where Christopher Clarke J explained the basic justification for a freezing order as follows:
“25. The purpose of the Mareva jurisdiction is sometimes referred to as the prevention of the “dissipation of assets”
. Without explanation that phrase is, itself, obscure. As Colman J stated in Gangway Ltd v Caledonian Park Investments (Jersey) Ltd (2001) 2 Lloyd’s Rep 715 the underlying purpose of the jurisdiction is not to provide a claimant with security for its claim but to restrain a defendant from evading justice by disposing of assets otherwise than in the ordinary course of business so as to make itself judgment proof with the result that any judgment or award in favour of the claimant goes unsatisfied. The purpose is not to provide security for the claimant in respect of his claim. It is well established that it is not necessary to establish that the defendant is likely to act with the object of putting his assets beyond reach. What has to be shown is that there is, absent an injunction, “a real risk that a judgment or award in favour of the plaintiffs would go unsatisfied”: The “Niedersachsen”: [1983] 2 Lloyd’s Rep 600. That formulation cannot, however, be regarded as a complete statement of the law. A defendant may be likely to make perfectly normal dispositions, such as the payment of ordinary trading debts, the effect of which may be that, when any award is made, it is, in whole or in part unsatisfied when, absent those payments, it might have been satisfied or satisfied to a greater extent. Something more than a real risk that the judgment will go unsatisfied is required.”[29]She also drew my attention to the convenient summary of the principles on risk of unjustified dissipation set out by Popplewell J as he then was in Fundo Soberano de Angola v Dos Santos [2018] EWHC 2199 (Comm) (“Fundo”) at [86]:
“86. The relevant principles have been summarised in a number of recent authorities, themselves referring to many earlier authorities, including National Bank Trust v Yurov [2016] EWHC 1913 (Comm) at paragraph [70] per Males J; Holyoake v Candy [2017] 3 WLR 1131 at paragraphs [34] and [59] per Gloster LJ; and Petroceltic Resources v Archer [2018] EWHC 671 (Comm) at paragraph [21] per Cockerill J. The following aspects are of particular relevance to the current applications: (1) The claimant must show a real risk, judged objectively, that a future judgment would not be met because of an unjustified dissipation of assets. In this context dissipation means putting the assets out of reach of a judgment whether by concealment or transfer. (2) The risk of dissipation must be established by solid evidence; mere inference or generalised assertion is not sufficient. (3) The risk of dissipation must be established separately against each respondent. (4) It is not enough to establish a sufficient risk of dissipation merely to establish a good arguable case that the defendant has been guilty of dishonesty; it is necessary to scrutinise the evidence to see whether the dishonesty in question points to the conclusion that assets are likely to be dissipated. It is also necessary to take account of whether there appear at the interlocutory stage to be properly arguable answers to the allegations of dishonesty. (5) The respondent’s former use of offshore structures is relevant but does not itself equate to a risk of dissipation. Businesses and individuals often use offshore structures as part of the normal and legitimate way in which they deal with their assets. Such legitimate reasons may properly include tax planning, privacy and the use of limited liability structures. (6) What must be threatened is unjustified dissipation. The purpose of a freezing order is not to provide the claimant with security; it is to restrain a defendant from evading justice by disposing of, or concealing, assets otherwise than in the normal course of business in a way which will have the effect of making it judgment proof. A freezing order is not intended to stop a corporate defendant from dealing with its assets in the normal course of its business. Similarly, it is not intended to constrain an individual defendant from conducting his personal affairs in the way he has always conducted them, providing of course that such conduct is legitimate. If the defendant is not threatening to change the existing way of handling their assets, it will not be sufficient to show that such continued conduct would prejudice the claimant’s ability to enforce a judgment. That would be contrary to the purpose of the freezing order jurisdiction because it would require defendants to change their legitimate behaviour in order to provide preferential security for the claim which the claimant would not otherwise enjoy. (7) Each case is fact specific and relevant factors must be looked at cumulatively.”
[30]The Court of Appeal in Holyoake reiterated at [34] that:
“… the threshold in relation to conventional freezing orders is well established. There must be a real risk, judged objectively, that a future judgment would not be met because of unjustifiable dissipation of assets. But it is not every risk of a judgment being unsatisfied which can justify freezing order relief. Solid evidence will be required to support a conclusion that relief is justified, although precisely what this entails in any given case will necessarily vary according to the individual circumstances…”
[31]The test is binary. It is not diluted even if the applicant is seeking a more circumscribed form of order than the standard form - [41] in Holyoake. The court should be alert that it is not effectively reversing the burden of proof by treating factors such as a mismatch between lifestyle and apparent income, or use of complex offshore corporate structures as requiring an explanation from the respondent [58] – [59].[32]Risk of dissipation is judged by reference to the objective effects; it is not necessary to show that this is the respondent’s intention: as Freedman J noted in Les Ambassadeurs Club Limited v Albluewi [2020] EWHC 1313 (QB) at [34]:
“[34] The risk of ‘dissipation’ must involve a risk of impairing the claimant's ability to enforce a judgment or award. It is not necessary to show that dissipation is the purpose or subjective intention of the defendant. It is sufficient that the objective effect of the actions of the defendant would be to make it more difficult to enforce the judgment. This was made clear by the Court of Appeal in Ninemia Maritime Corp v. Trave Schiffarhrtsgesellschaft GmbH (The Niedersachsen) [1983] 1 W.L.R. 1412, 1422 per Kerr LJ. There does not have to be apprehended a dealing with assets with the object of putting them out of the claimant’s reach: ‘... the test is whether, on the assumption that the plaintiffs have shown at least 'a good arguable case', the court concludes, on the whole of the evidence then before it, that the refusal of a Mareva injunction would involve a real risk that a judgment or award in favour of the plaintiffs would remain unsatisfied.’”
[33]In the present case Ms Colter does not allege that the sale of TJB Old’s business was intended as dissipation or to put assets beyond the reach of creditors, but she submits that nevertheless it was an “unjustified dissipation” because it was a sale of virtually all of the existing business and its assets and so this was its objective effect, even if the sale was apparently for full value, received and still held in the UK, as it was said to be. She further submits that such a divestment was not a transaction which was within the ordinary course of TJB Old’s business and so it was an unjustified dissipation. Furthermore, she says that the court should infer that there is also a risk of future unjustified dissipation from the facts around the sale and subsequent responses from TJB Old. Since TJB Old in its new guise does not yet have any trading record, it does not yet have any ordinary course of business, and the examples of possible future investments in GL’s letter of 12 May 2026 are also potentially risky. Furthermore, she says TJB Old has given minimal information as to its future intentions and there is nothing to stop it simply transferring the cash received out of that company altogether. Freestream’s concern is that the cash consideration will go and the shares cannot be the subject of any realistic enforcement.[34]By reference to the Court of Appeal decision in Organic Grape Spirit Ltd v Nueva IQT SL [2020] EWCA Civ 999, [2020] 2 CLC 176 (“Organic Grape”) Ms Colter submitted that where a company was embarking on a new venture with no track record to benchmark against, the Court of Appeal has said this was not a transaction within the ordinary course of business. That case concerned the standard exception for such transactions in an existing freezing injunction, and the court permitted the new business venture to proceed, outside that exception. It was held that although the judge had been unable to assess the prospects of success of that proposed new business, it was a genuine commercial venture supported by a business plan and it was not the purpose of a freezing injunction to prevent a respondent from using its assets for such a purpose even if it was risky. However Ms Colter submitted that in the present case, TJB Old’s refusal to provide any answer as to its future investment intentions meant that it was in effect saying it could do what it liked with the sale proceeds, including investing it all in an unspecified new business. This, she said, was different from Organic Grape and would amount to a real risk of future unjustified dissipation.[35]Ms Colter also placed particular weight on the cases of Guerrero v. Monterrico Metals Plc [2009] EWHC 2475 (QB) (“Guerrero”) and Bravo v. Amerisur Resources Plc [2020] EWHC 125 (QB) (“Bravo”) which were both cases not involving allegations of dishonesty where the relevant unjustified dissipation involved a legitimate sale and transfer overseas of the respondent’s UK business assets.[36]In Guerrero the respondent had been acquired by a Chinese company. The evidence confirmed that there was no real commercial reason for the respondent to maintain a presence in England, and that it might reorganise so as to relocate to China or Hong Kong (at [28]). The applicants did not suggest there were any “sinister reasons” for such a removal of its assets and effective seat from the jurisdiction. The respondent’s counsel “realistically did not seek to argue that there was no risk that assets would not be available within the jurisdiction to satisfy any judgment which the Claimants might obtain.”[37]In Bravo, again the respondent’s counsel did not pursue the point that there was no risk of dissipation. Again there was no suggestion of any “nefarious reason” for the sale. The facts were that the respondent had received an offer for all of its shares from a Colombian-based company; dealing in its shares had been suspended and its London Stock Exchange listing had been cancelled (see generally at [19]-[20]). The buyer’s expressed intention was to “fold the defendant’s business into its own”. This would include closing the respondent’s English offices and relocating the company’s headquarters to Bogota. Against that background a freezing order was made on the basis that there was a risk of unjustifiable dissipation, since again there would otherwise have been no assets remaining in the UK.[38]Ms Colter submitted, on the basis of these cases, that where the respondent was ceasing to exist or was being stripped of its assets in their entirety, then this would not be justifiable dissipation in the sense of being done in the normal course of business. Initially she denied that she was saying the present case amounted to an asset strip, although this had initially been Freestream’s concern. However, she submitted that it was sufficient that there was a total divestment of TJB Old’s business, even if the sale consideration had been received by it, because this needed to be viewed in tandem with the liquid nature of the cash payment received and the absence of any explanation as to future investment intentions. Subsequently she modified her position somewhat by saying that although it clearly was not a pure asset strip, it was still a situation where all of the assets of the business had gone and so was comparable to cases like Guerrero and Bravo.[39]In reply Mr Power submitted that there was no solid evidence of unjustifiable dissipation, let alone a future risk. He said that an asset sale combined with the fact the newly named entity did not have a trading history in the sectors in which it was going to invest was not sufficient. He said it was very significant that it was agreed that this was an arm’s length transaction, bona fides, not a sham and not related to the litigation, and that it was not disputed (Freestream having put forward no evidence to the contrary) that the sale was for full value. There was no suggestion that TJB Old was moving assets to avoid a judgment – while not the only way to prove a risk of unjustified dissipation, that was a frequent feature of applications for freezing injunctions. A sale of the business combined with an absence of evidence as to future intentions could not be sufficient to amount to unjustified dissipation. He submitted that no prima facie case of unjustified dissipation had been raised, but in any event an explanation of the transaction had been provided, along with evidence from the accountants that TJB Old’s net asset position exceeded US$10M and that the cash received was still held in a UK bank account.[40]He also submitted that Freestream was incorrectly eliding proof of a risk of unjustified dissipation with asking whether the transaction was within the respondent’s ordinary course of business. Organic Grape was a case of an existing freezing order where the court determined that the new venture, albeit not within the ordinary course of business exception, should nevertheless be permitted in the court’s discretion, respecting the respondent’s entitlement in principle to be able to deal with its own assets. Here TJB Old was entitled to whatever it wished to do, lawfully, with its own money, as long as it was not engaging in unjustified dissipation. Applying Fundo at [86(6)], Freestream could not require TJB Old to change its legitimate behaviour. Here that meant it could not restrain Mr Varsano, aged nearly 70, from receiving and cashing in a very good offer from Flexjet for the business, and the company then using the money received for other, new investments, since that was all legitimate behaviour.[41]On the question of real risk of unjustified dissipation, my conclusion is that Freestream has not raised a prima facie case, but that in any event, considering the evidence from TJB Old as well as from Freestream, the test is not met. This is for the following reasons: i) The fact that Freestream accepts that the sale was a bona fide, arm’s length transaction, which was not related to the litigation, and indeed negotiations for which predated the claim, is an unpromising start. Furthermore, Freestream does not put forward any evidence that the sale was not at full value: it says it cannot do so because it knows nothing about the sale. However, in my view Freestream is therefore effectively accepting for the purposes of this application that this was a legitimate business transaction which TJB Old was entitled to undertake; certainly it is not putting forward any positive case that the sale was not, and the burden of proof is on Freestream. While there was no evidence of the details of the transaction, including as to how the shares are held, nor of the value which was placed on TJB Old, the evidence available, including the arm’s length nature of the transaction, the extended period of negotiation, the widespread publicity following the sale, and the accountants’ evidence as to TJB Old’s healthy net asset position, points to this having been a sale at market value from which TJB Old has benefitted. In principle, a respondent should be permitted to use its own assets freely for its own business purposes, so long as it is not engaged in unjustified dissipation or creating a risk thereof. Therefore Freestream would have to establish some other basis for showing that this sale nevertheless amounted to unjustified dissipation. In my view neither the sale itself, nor the proposed or actual use of the proceeds in new business ventures or investments amounts to unjustified dissipation, without more. ii) It is not necessary for an applicant to prove any intention by the respondent to put assets beyond the reach of creditors, only that the effect is unjustified dissipation. However, in the absence of evidence of any such intention, the fact there is a good, bona fide explanation for the sale undermines any argument that the sale itself amounted to unjustified dissipation, at least without some additional feature such as that the respondent is not receiving the sale proceeds or is closing down its business. iii) Guerrero and Bravo are clearly distinguishable because in both those cases the English company and business was being or was likely to be closed down, and there was no suggestion that any sale consideration was being retained within the respondent. There would have been literally nothing left in the respondent. In addition, in both cases it was conceded without real argument that there was therefore a risk of unjustified dissipation. However, here the available evidence is to the effect that the sale proceeds, apparently representing the market value of the business, were received by the respondent, and the cash element is still being held in the respondent’s English bank account, the respondent being a UK company. TJB Old is intending to continue to trade in the UK and has future plans, albeit new ones. It is not closing down; it is pivoting in a new direction and with a new purpose. Unsurprisingly, its accountants have confirmed that its net asset position is if anything better now than it was before the sale, and its net assets substantially exceed the value of the claim. Not only does the available evidence indicate this was a legitimate business sale, it is not one which the evidence suggests has worsened the overall asset position of the company. As such, on the evidence available, in my view TJB Old has not to date dissipated its assets at all. iv) When determining whether there has been unjustified dissipation on an application for a freezing injunction, it is not in my view appropriate simply to ask whether a transaction which has occurred was within the ordinary course of the respondent’s business and treat that as an answer. Of course, if it was, then it cannot sensibly amount to unjustified dissipation, but the reverse is not necessarily true. The court in Organic Grape was asking a different question, which was whether the transaction fell within the standard freezing order exception. The distinction is particularly important because the court interpreted the exception narrowly, and as not extending to a new business venture which had no previous track record to benchmark against. In contrast, there are many legitimate business transactions which a respondent might undertake which would be outside its ordinary course of business, but that does not necessarily or even prima facie mean they would amount to unjustified dissipation for the purposes of a freezing order application. v) This is especially true of a respondent starting a new business venture which does not yet have any “ordinary course of business”. Selling the respondent’s existing business and starting afresh is a good example of a transaction which in my view would not normally be in the ordinary course of business, but which would not generally amount to unjustified dissipation at least if it is an exchange for full value received by the respondent itself, as the available evidence indicates was the case here. Where, as here, the evidence indicates that those sale proceeds have been received and are being retained by the respondent with the intention of using the cash in new ventures, I do not consider that that can amount to a risk of future unjustified dissipation either, without more. vi) I do not consider that I should infer from the fact that TJB Old is unwilling or unable to say what its future investment intentions are that this amounts to a risk of unjustified dissipation, even if its main available assets are cash and therefore liquid. That is not solid evidence of such a risk. Similarly the fact that TJB Old and Mr Ricci are not willing to disclose commercially sensitive information about the sale price or transaction details does not mean I should infer such a risk from that absence of information. If Freestream cannot raise a prima facie case of unjustified dissipation from other evidence, and my conclusion is that it cannot, then TJB Old is not obliged to give any further information. Certainly I should not infer any risk from its refusal or inability to give any more information than it has done. vii) My inference is that Freestream’s real motivation for continuing to pursue this application, even after receiving an explanation of the sale, is indeed, as Mr Power submits, to try to obtain better security for any future judgment and/or improve its negotiating position, where TJB Old has changed its business and asset profile. However, unless there is solid evidence of a real risk of unjustified dissipation, that is in my view a risk of litigation which Freestream takes.

Just and convenient

[42]In those circumstances, the question of whether it is just and convenient to make a freezing order does not arise. In particular I make no findings in respect of the various allegations about conduct which Freestream and TJB Old each make against the director of the other, it being unnecessary for me to do so.

Conclusion

[43]For those reasons Freestream’s application for a freezing injunction is refused.