Radical Changes In Interlocutory Proceedings In Cyprus - Court Procedure - Cyprus

[Gunnar Larson]

Cyprus: Radical Changes In Interlocutory Proceedings In Cyprus
22 December 2023
by Christiana Pyrkotou
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and Aimilia Efstathiou
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Elias Neocleous & Co LLC
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Article 32 of the Courts of Justice Law, L. 14/1960, which governs the
jurisdiction of civil Courts to issue interlocutory orders, has been
recently amended by the L. 114(Ι)/2023, introducing radical changes in this
field.

In essence, the recent amendments have notably widened the jurisdiction of
the Courts to issue interlocutory orders.

According to the amending law, the Courts have jurisdiction to hear an
application for interlocutory proceedings any time, including the time
before the filing of the claim or following the issuance of a judgment in
relation to judicial or arbitral proceedings that took place, are taking
place, or are going to take place, within or out of the jurisdiction.
Furthermore, as far as it concerns the power of the Court to grant
interlocutory orders in aid of judicial or arbitral proceedings, the Court
has jurisdiction where the respondent is within the jurisdiction, or the
property that constitutes the subject matter of the remedy sought is
located within the jurisdiction, or where there is such a link with Cyprus
rendering the court appropriate to hear and decide the interlocutory
application.

Before the amendment of the law, the advancement of an application seeking
interlocutory proceedings was not possible in the absence of an underlying
claim. There has been established case law providing that an application
for interlocutory order is filed where there is an actionable right for
remedy and that an interim order does not constitute by itself an
actionable right. An interlocutory order is ancillary to a substantial
claim that is advanced within the context of an action according to the old
English decision in *T**he* *Siskina*1 . In *The Siskina* it was stressed
that the right to an interlocutory order does not constitute a standalone
actionable right, it is not a free-standing right and, as such, it depends
on an existing actionable right.

At this point it is noted that the approach taken in *The Siskina* has been
eroded by legislative amendments in the UK. Similarly, in Cyprus the latest
amendment of the Courts of Justice law constitutes a legislative departure
from the previous approach, something that is also illustrated in Part 25
of the new civil procedure rules providing that applications for
interlocutory orders may be filed, under certain circumstances, before the
filing of a claim or after the issuance of the judgment.

Additionally, before the latest amendment, it was not possible to obtain an
interlocutory order in aid of judicial proceedings pending abroad (apart
from the EU) in the absence of a bilateral or a multilateral convention.
The possibility to issue an interlocutory order in aid of arbitration
proceedings, though, was already available in Cyprus legal system under
article 9 of the International Arbitration Law, L.101/1987.2

Despite the fact that the discretion of the Cyprus Courts to issue
interlocutory injunctions was wide even before this amendment, the Courts
have repeatedly stated that this discretion is exercised within the limits
prescribed by the law and, thus, in the absence of a statutory provision,
the possibility to issue interlocutory orders in aid of judicial
proceedings was limited only in aid of proceedings pending before the
Courts of the member states of the European Union pursuant to article 35 of
the EU Regulation 1215/2012, as well as in instances where the Republic of
Cyprus has entered into an international convention for judicial assistance
in this respect.3 In all other instances of foreign judicial proceedings,
the Cypriot Courts' approach was that there was no jurisdiction to issue
interlocutory orders.

Considering the range of the recent amendments, the green light has been
given to advance such interlocutory applications at any time and in aid of
judicial proceedings wherever these are taking place (provided of course
that all statutory elements are met).

It could be said that the recent amendments of the Courts of Justice Law
aim to modernize the legal system of Cyprus providing further flexibility
considering not only the developments of the common law case law, but also
the societal changes, such as the ease and speed with which money and other
financial assets can be moved around the world, the globalisation of
commerce and economic activity and consequent growth of litigation and
arbitration with international dimensions as well as the growth and use of
offshore companies.4

Having said that, it remains to be seen how the Cyprus Courts will approach
the newly added legislative possibilities and whether the pre-existing case
law will set boundaries in further developments.

Footnotes

1 The Siskina [1979] AC 210

2 Attorney General of the Republic of Kenya ν. Bank Fur Arbeit and
Wirtschaft A.G. (1999) 1 C.L.R. 585, Commerzbank Auslandbanken Holding A.G.
a.o. ν. Adeona Holdings Ltd, Civil Appeal no. Ε6/2014, 27.2.2015.

3 Volodimir Spilnichenko ν. ANGILERI INVESTMAENTS LTD a.o., Action no.
5652/15, 31/3/2017, CLOSED JOINT-STOCK INVESTMENT COMPANY FINANSOVY DOM ν.
UFS CAPITAL LIMITED a.o., Action no. 4480/15, 19/5/2016

4 Broad Idea International Ltd (Respondent) v Convoy Collateral Ltd
(Appellant) (British Virgin Islands) [2021] UKPC 24.

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