Exploring Offshore Litigation

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Jun 2026

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Exploring Offshore Litigation is a captivating podcast series containing audio of written blog content that dives deep into the intriguing world of offshore litigation, including the BVI and Cayman. Each episode sails through complex legal waters, bringing you up-to-date analysis of recent high-stakes cases and expert commentary from the leading minds in this specialised field. Our episodes demystify legal jargon and break down complex cases to make them accessible to all. Harneys, an international law firm with entrepreneurial thinking, brings each episode to you.

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June 12, 20268 min

58.com - Court determines reliability of merger price in latest section 238 fair value appraisal judgment Background The judgment Key takeaways

The Grand Court has delivered its judgment in Re 58.com, Inc., a long running and highly contested section 238 fair appraisal dispute in the Cayman Islands. Following a six-week trial before the Honourable Chief Justice Ramsay-Hale in 2024, the Court ultimately rejected the dissenters' contended fair value of $105.56 per American Depository share (ADS) (89 per cent higher than the merger consideration) based on a discounted cash flow (DCF) analysis. Recognising the Privy Council's decision in Maso Capital Investments Ltd v Trina Solar Ltd (Trina Solar), the Court determined that the merger consideration of US$56 per ADS represented the fair value of the dissenters' shares, noting that "a flawed [merger] process does not automatically disqualify the merger price". Prior to the merger, 58.com was a NYSE-listed, Cayman Islands-incorporated company which operated an online classifieds platform in the People's Republic of China. In 2020, its founder and CEO, Mr Jinbo "Michael" Yao, led a management-backed take-private by a consortium including Ocean Link Capital, Warburg Pincus and General Atlantic, at a price of US$56 per ADS. The merger, valued at US$8.7 billion, was the largest take-private of a PRC company at the time. Following completion, the dissenters (comprising professional appraisal arbitrage investors) exercised their statutory right under section 238 of the Cayman Islands' Companies Act to have the Court determine the fair value of their shares. At trial, the Company argued that fair value represented an average of the merger price blended with a mid-point of Adjusted Market Trading Price (AMTP), so that merger price operated not as a primary indicator of fair value but as a ceiling that should not be exceeded. The dissenters, on the other hand, relied exclusively on a DCF analysis, arguing that no weight could be placed on merger price due to flaws in the merger process. They also challenged the reliability of an AMTP valuation on the basis that the market for the Company's shares was inefficient and that material non-public information (MNPI) was available to insiders – both of which they argued rendered fair value unreliable. The Court acknowledged that the "decision in Trina Solar makes it clear that the reliability of the transaction price forms part of the Court's assessment of the appropriate valuation methodology and must be evaluated before determining the weight to be given to competing indicators of value". The Court upheld the Privy Council's determination that reliability of the merger price is not a binary concept but a qualitative assessment on a sliding scale and there is no presumption in favour of, or against, the merger price. The Court further noted that deficiencies in the deal process do not automatically disqualify it and that factors identified in the relevant Delaware authorities (on which the Cayman Islands courts have relied in section 238 appraisal matters) can be persuasive and are useful guides, but they are not a checklist that must be satisfied before any reliance may be placed on a merger price. While the Court acknowledged certain imperfections during the merger process in 58.com, including informal communications between a Special Committee member and the buyer group, and the absence of a go-shop/market check, it was not persuaded that those features distorted the merger price ultimately agreed or deprived the Special Committee of its ability to act independently. The Court also concluded that AMTP was not a reliable indicator of fair value in this case and should be accorded no material weight given certain MNPI (comprising revised management projections and operational updates that were available to insiders of the Company) and concerns regarding the roll-forward carried out by the Company's expert, undermined the premise that the market price reflected intrinsic value. The Court also rejected the dissenters' DCF valuation on the basis that that their chosen cash flow inputs were...

June 11, 20265 min

A paradigm case for privacy: the Grand Court's authoritative restatement on confidentiality in trust proceedings Background The legal framework: balancing open justice and privacy Judgment Comment

The recent decision in In the Matter of the D, E, F, G and H Trusts serves as an important reminder on the nature of the confidentiality framework in trust proceedings for parties in the Cayman Islands. In a clear and helpful judgment, the Grand Court has restated the principles governing when, and how, confidentiality orders will be granted in private trust cases. Between 2007 and 2009, a former trustee accepted additions to the trust fund from an individual without appreciating that, under the terms of the trust instrument, the act of making those additions rendered the contributor a "settlor" and, by operation of the definitional machinery, an "excluded person" who could no longer benefit from the trust. Distributions were subsequently made to or for the benefit of that individual, and assets were transferred to related trusts established for his children in which he also held an interest. On the trustee's analysis, each of these steps had been taken in breach of trust. Seeking to rectify the position, the current trustee turned to a remedy that will be familiar to trust practitioners: an application under section 64A of the Trusts Act (2021 Revision), the statutory codification of the Hastings-Bass jurisdiction in Cayman law, for declarations that the relevant deeds of addition were void. Before filing the substantive proceedings, the trustee adopted what has become the established two-stage approach: by first making an ex parte on notice application for confidentiality and anonymisation orders designed to shield the trusts, the family, and the proceedings from the public; followed by the substantive section 64A proceedings. The Chief Justice identified the constitutional starting point in determining whether to grant a confidentiality order: the principle of open justice. Sections 7(1) and 7(9) of the Constitution require that proceedings be conducted in public and, as Newman JA observed in AHAB, "the administration of justice in Cayman must comply with the principle of open justice". That principle, however, is not absolute. The Chief Justice noted how section 7(10) of the Constitution expressly permits derogation where it is "necessary or expedient in the interests of justice", including where publicity would prejudice the interests of justice, involve the welfare of minors, or compromise the private lives of the persons concerned. Drawing on a rich line of authority, the Chief Justice distilled the applicable test into three clear questions: 1. Gateway: Does the case fall within a recognised category permitting derogation from open justice? 2. Proportionality: Is the confidentiality sought necessary and proportionate? 3. Countervailing interest: Is there any public interest that outweighs the privacy interests engaged? Applying the three-stage test to the present case, the Chief Justice found this to be "a paradigm case for the grant of confidentiality orders". The Court found that: the proceedings were properly characterised as internal trust administration matters; that there was no suggestion of public misconduct, regulatory concern, or wider public interest engaged; and that the information at stake (encompassing financial affairs, family relationships, and the identity and status of beneficiaries, including minors) was described as "inherently private". The Court accordingly granted the relief sought: anonymisation of the parties by initials, the filing of an anonymised originating summons only, sealing of the court file, private hearings, and anonymised publication of any resulting judgments or orders. This judgment serves as a welcome restatement of the principles governing confidentiality in Cayman Islands trust proceedings. For parties to trust applications and proceedings, the Chief Justice's three-stage test provides a clear framework that must be squarely addressed in every application: 1. Identify the gateway: establish that the matter falls within a recognised category permitting derogation from open j...

June 4, 202612 min

Can a Trust Be a "Person"? Lessons from the New Zealand Supreme Court for Offshore Trust Practitioners

On 13 May 2026, the Supreme Court of New Zealand granted leave to appeal in RH & JY Trust v WorkSafe New Zealand, and considered whether a trust and/or the trustees of a trust acting collectively constitutes a "person" for statutory purposes. Although the case arises under New Zealand's Health and Safety at Work Act 2015, the underlying question, whether a trust can bear obligations and liabilities as if it were a distinct legal entity, raises interesting questions about the nature of trusts and trustee liability that are likely to resonate across common law jurisdictions. A tragic accident took place in September 2020, where a young child lost their life as a result of injuries sustained on a farm owned and operated by the RH & JY Trust. At the time, the Trust had three trustees: two individual trustees (once since deceased), and Perpetual Trust Limited, a corporate trustee appointed only five weeks before the accident. WorkSafe New Zealand, the workplace health and safety regulator, brought criminal charges under sections 37(1) and 48(1) of New Zealand's Health and Safety at Work Act 2015 against both the Trust itself and, in the alternative, the trustees collectively. The trustees challenged whether charges could validly be brought against the Trust or against them as a collective, as distinct from charges against each trustee individually. The case has produced a striking divergence of judicial opinion at each level. The District Court In the District Court, Judge Bidois held that no charges could be brought against the trust or the trustees collectively, reasoning that "a trust is not a person and cannot be held liable for the actions or failures of the trustees of the trust". On this view, only the trustees in their individual capacities could be defendants, and the charges against the Trust were dismissed. The High Court Harvey J allowed WorkSafe's appeal in part. He accepted that "notwithstanding the orthodox position that a trust is not a separate legal entity, the position can be displaced by specific legislation" and that "the orthodox position that a trust is not a separate legal entity is relevant but not determinative". He found that it would be a "perverse outcome" if three loosely associated persons carrying out business with an informal structure could collectively be a 'person conducting a business or undertaking' (PCBU), but three trustees holding business assets in trust could not be. However, Harvey J concluded that the correct defendant was the trustees collectively, not the Trust itself, preferring an interpretation that "accords more closely to civil law and to reality". The Court of Appeal The Court of Appeal's decision was a 2-1 split. The majority (Cooke and Palmer JJ) held that a trust, or its trustees acting collectively, can be a "person" for the purposes of the Act; Whata J dissented. Cooke J, delivering the majority judgment, acknowledged the force of the argument that "concluding that a trust is a person who can be charged with an offence is apparently inconsistent with well-established principles of trust law". A trust is not a legal person; it is essentially a set of equitable obligations that the trustees have. Nevertheless, the majority held that "whilst trust law creates a very strong starting point for addressing the issues of interpretation that arise, it is not determinative". The majority's reasoning rested on several pillars: The definition of "person" in section 16 of the Act "includes the Crown, a corporation sole, and a body of persons, whether corporate or unincorporate". The majority reasoned that these definitions "extend who can be a PCBU to unincorporated bodies of persons" and that "questions of legal form are not determinative. It depends on who is conducting the business or undertaking as a matter of substance". The majority also relied heavily on Discount Brands Ltd v Westfield (New Zealand) Ltd [2005] NZSC 17, where Tipping J observed that "by making unincorporate bodi...

May 21, 20266 min

Into Perpetuity: The Grand Court Charts New Territory Under the Cayman Islands' Reformed Trust Regime

The Perpetuities Act (2025 Revision) marks an important moment for Cayman Islands trust law. For settlors of new trusts, the legislation offers the power to opt out of any perpetuity limitation at inception. For those who administer existing structures, it creates a streamlined, court-supervised route to convert a fixed-term trust into one of unlimited duration. In March 2026, in what is understood to be the first successful application of its kind under the new statutory jurisdiction conferred by section 20 of the Perpetuities Act (2025 Revision), Harneys successfully obtained an order from the Grand Court, disapplying the rule against perpetuities for a discretionary family trust. The order empowered the trustee to execute a deed of variation replacing the trust's fixed-term period with an indefinite duration. The Reforms to the Perpetuities Act in Brief Prior to the amendment effected by Act 7 of 2024 (which came into force on 22 August 2024), Cayman Islands discretionary trusts were subject to a statutory perpetuity period of 150 years from the effective date of the relevant instrument. Part 3 of the 2025 Revision, which consolidates the 2024 amendment, changes the landscape in three material ways. First, for new trusts created on or after 22 August 2024, the instrument itself may simply provide that the rule against perpetuities does not apply (provided the trust does not hold Cayman land or any interest in Cayman land). The land carve-out is narrow in that it does not extend to income from Cayman land or to the proceeds of sale of Cayman land, and a trust that has opted out of the rule may still hold an interest in an entity that owns Cayman land for the purposes of its business. Second, for existing trusts (whenever created), section 20 permits a trustee, settlor, enforcer, power-holder, or beneficiary to apply to the Grand Court for an order declaring that the rule does not apply. The Court may grant the order where it is satisfied that doing so would not be to the detriment of the beneficiaries. Third, trusts of unlimited duration governed by a foreign law that has no perpetuity rule may change their governing law to Cayman without re-introducing any duration limit. The Application to disapply Harneys acted for a professional trustee of a discretionary family trust seeking to give effect to the dynastic objectives of the settlor through the grant of a court order. In the absence of Cayman authority on the exercise of the section 20 jurisdiction, the Court was invited to approach its discretion by reference to persuasive Bermudian case law under section 4 of Bermuda's Perpetuities and Accumulations Act 2009, a materially analogous provision to section 20 of the Perpetuities Act (2025 Revision). Principles The application before the Grand Court drew on judicial guidance from the Supreme Court of Bermuda that establish clear principles guiding the exercise of the statutory power to disapply the rule against perpetuities. The Bermudian authorities establish that: The Court must not function as a "rubber stamp": disapplication will only be granted where it facilitates the continued efficient administration of a family trust, where no beneficiary is materially prejudiced, and where the relief accords with the best interests of the trust as a whole. A forced distribution at the end of a perpetuity period could give rise to significant tax liabilities and premature dissipation of assets to the detriment of future generations—this is a strong justification for disapplication. The potential dilution of existing beneficiaries' economic interests as a result of extending the duration of a trust will ordinarily be an irrelevant consideration. Distilling and drawing from these Bermudian principles, the Cayman Islands Grand Court will therefore likely exercise its discretion in favour of granting relief where disapplication would: (a) accord with the settlor's wishes and the objectives of the trusts; (b) serve the best interests ...

May 13, 20269 min

Common sense and common law: Navigating the gap between breach and loss

The Court of Appeal of England and Wales has dismissed an appeal in Logix Aero Ireland Limited v Siam Aero Repair Company Limited, holding that the voluntary acts of fraudsters broke the chain of causation between an assumed breach of a confidentiality clause and the claimant's loss. The decision restates the principles of legal causation in contract and clarifies the limited reach of London Joint Stock Bank v Macmillan. Although the decision is one of English law, the causation principles applied are common law principles regularly cited in the Cayman Islands and other International Financial Centres (IFCs). Background Logix agreed to purchase two aircraft engines from Siam Aero under a Letter of Understanding (LOI). The LOI was predominantly non-binding. However, certain clauses – including a confidentiality provision – were expressly stated to be legally binding. Unknown fraudsters intercepted email correspondence between the parties. They registered domain names differing from the genuine addresses by a single character and began altering emails before forwarding them on. Among the changes, they substituted their own Vietnamese bank account details for Siam Aero's Thai account in draft Purchase Agreements and invoices. Logix paid the balance of the purchase price to the fraudsters' account believing it was paying Siam Aero. Logix took no independent step to verify the bank details. The fraud came to light days later when Siam Aero informed Logix by telephone and WhatsApp that it had not received payment, by which point the funds had already left the fraudsters' account. Logix commenced proceedings in England. It initially alleged Siam Aero's complicity in the fraud but dropped that allegation after forensic investigation. The claim was narrowed to a single ground: that Siam Aero's four emails to the fraudsters breached the confidentiality clause and caused Logix's loss. The issues At first instance, Mrs Justice Williams struck out the proceedings under CPR 3.4(2)(a), holding that the claim was "bound to fail". She accepted it was arguable that Siam Aero breached the confidentiality clause by unwittingly "disclosing" documents and information to the fraudsters. She held, however, that it was not arguable that any such breach caused Logix's loss. Lord Justice Males granted permission to appeal solely on causation. On appeal, Logix argued that the Judge wrongly failed to follow Macmillan. In that case, a firm had drawn the cheque negligently, leaving gaps in the figures and words that the clerk exploited to increase the amount from £2 to £120. The House of Lords held that, notwithstanding the intervening fraud, the firm's negligence in drawing the cheque facilitated the forgery and was the effective cause of the loss. As such, the firm was precluded from recovering its loss from the bank on the basis that "forgery is not a remote but a very natural consequence of negligence of this description". Siam Aero opposed the appeal on the ground it was not arguable that its actions breached the confidentiality clause at all. The judgment Lord Justice Phillips (Lord Justice Peter Jackson and Lady Justice Cockerill agreeing) dismissed the appeal. It was common ground that the "but for" test of factual causation was satisfied. The question was whether Siam Aero could be held liable despite the intervention of the fraudsters. The Court identified three principles by which the chain of causation may be broken: 1. First, the breach may not be the "effective" or "dominant" cause of loss but merely the opportunity or occasion for it (Galoo v Bright Grahame Murray; Armstead v Royal & Sun Alliance). The same distinction has been applied in the Cayman Islands. In Omni Securities v Deloitte & Touche, the Court of Appeal considered the Galoo test in the context of auditors' negligence and held that whether a breach was the "effective cause" of loss, or merely the "occasion" for it, was to be resolved by "the application of the court's common s...

May 11, 20269 min

Statutory Hastings-Bass in the Cayman Islands: the Grand Court sets aside a deed of exclusion

In the recent decision of The Trustees v AB and Ors (Re the D Trust) the Cayman Grand Court granted relief under section 64A of the Trusts Act (2021 Revision) (the Act) to set aside a deed of exclusion (Deed of Exclusion) executed by previous trustees in reliance on erroneous UK tax advice. The decision adds to the growing body of authority on the statutory Hastings-Bass jurisdiction in the Cayman Islands, and includes guidance on the good faith requirement, standing by successor trustees, notification to tax authorities, and whether section 64A applications should be dealt with on the papers. Background The D Trust is a Cayman Islands discretionary trust with a broad class of beneficiaries. It was originally governed by New Zealand law, but its proper law and forum were changed to the Cayman Islands in November 2019. The trust formed part of a wider estate planning structure. When the D Trust was settled in 2011, the Settlor transferred non-UK situs property into it. A connected trust (the H Trust, governed by Guernsey law) borrowed those funds to purchase a residential property in England. The arrangement was designed to ensure the loan owed by the H Trust to the D Trust remained "excluded property" for UK inheritance tax (IHT) purposes, shielding the value of the UK property from any charge on the Settlor's death. In early 2017, proposed changes to the IHT regime threatened to undermine that planning. The previous trustees instructed a specialist London firm, which recommended (among other options) executing a deed of exclusion to declare the Settlor an "Excluded Person" under the trust deed. The Deed of Exclusion was executed on 30 March 2017, shortly before the new rules took effect on 6 April 2017. In January 2025, a different London firm reviewed the arrangements and concluded that the original advice had been incomplete and in places erroneous. It had failed to consider: (i) the risk that section 102 of the UK Finance Act 1986 would treat the Settlor as having incurred the H Trust's liabilities; (ii) whether the charge over the UK property was an "incumbrance created by a disposition made by [the Settlor]" within section 103 of that Act; and (iii) how the General Anti-Abuse Rule might apply to the 2017 arrangements. The D Trust faced the very IHT exposure the Deed of Exclusion was supposed to prevent. The issues The current trustee applied by originating summons for a declaration that the Deed of Exclusion was void ab initio under section 64A of the Act. The application was dealt with on the papers. The principal issues were: (i) whether the current trustee had standing; (ii) whether the statutory conditions in section 64A(2) were satisfied; (iii) the scope of the court's residual discretion (including the good faith requirement and notification of HMRC); and (iv) whether it was appropriate to determine a section 64A application without an oral hearing. The judgment The applicable law Justice Segal adopted the analysis of Justice Kawaley in Maples Trustee Services v AB (In Re Settlements), describing it as "a clear and authoritative summary of the applicable law". Justice Kawaley had identified three strands of the statutory language: 1. the power must be a fiduciary power; 2. but for the mistake the power would not have been exercised in the same way, at the same time, or at all; and 3. the person exercising the power must have failed to take into account relevant considerations, or taken into account irrelevant ones. Justice Segal adopted Justice Kawaley's tentative view (that section 64A contains an implied good faith requirement), reasoning that such a qualification is necessary to keep the jurisdiction within proper bounds and avoid what Lord Neuberger extrajudicially described as giving trustees a "get out of jail free card". He disagreed, however, with Justice Kawaley's observation that the circumstances required for section 64A relief are "likely in many (if not most) cases to be indistinguishable (legal lab...

May 7, 20265 min

BVI Court of Appeal reaffirms high threshold for case management stays pending foreign proceedings

In the recent decision of Lim Yew Cheng v Guanghua SS Holdings Limited, the BVI Court of Appeal dismissed an appeal against a first instance refusal to stay BVI recognition and enforcement proceedings pending the outcome of litigation in Hong Kong. The judgment is a useful restatement of the demanding test that an applicant must satisfy where it asks the court to put its own proceedings on hold to await the resolution of foreign litigation. Background In April 2022, Guanghua SS Holdings Limited (Guanghua) obtained a Hong Kong High Court Judgment arising out of two US$80 million loan facilities personally guaranteed by Mr Lim and his son, Lin Minghan. In June 2024, Guanghua commenced recognition and enforcement proceedings in the BVI, which Mr Lim sought to stay, first relying on pending separate Hong Kong proceedings (the Hong Kong Proceedings) and, subsequently a further claim issued in Hong Kong and derivative proceedings brought in the BVI. Mithani J (Ag.) refused both the stay and a related adjournment application, and Mr Lim appealed. The threshold for a case management stay The central question on appeal was whether Mithani J, when considering whether it was appropriate to grant stay of the enforcement proceedings on case management grounds, had applied the wrong test by failing to follow Athena Capital Fund SICAV-FIS SCA v Secretariat of State for the Holy See. Ward JA accepted that the single test is whether, in the particular circumstances, it is in the interests of justice to grant a stay. However, drawing on the analysis of Males LJ in Athena Capital, the Court emphasised that the presence of "rare and compelling circumstances" remains a highly relevant factor where the stay sought is to await foreign proceedings. The Court held that, while the "rare and compelling circumstances" formulation is not itself the legal test, "it is only in rare and compelling circumstances that it will be in the interests of justice to grant a stay on case management grounds to await the outcome of foreign proceedings", describing this as a "high threshold" and noting that the usual function of the court is to decide cases, not decline to do so. The appeal The Court observed that while the first instance judge did not expressly articulate the test he applied, the factors he relied upon were "plainly relevant" to the interests of justice question under the applicable test. These included the facts that (a) the Hong Kong Judgment had not been appealed, (b) no application had been made to stay the Hong Kong Judgment in Hong Kong, which would have been an obvious and effective way to bring a halt to the BVI enforcement proceedings, and (c) the relief sought in the Hong Kong Proceedings did not seek to set aside the Hong Kong Judgment. In those circumstances, there was no reason to regard the Hong Kong judgment as not final and no reason why the judge could not proceed with the recognition and enforcement claim. The appellant, Mr Lim, also sought to make much of the judge's statement that he had not considered his late evidence in great detail. The Court noted, however, that the judge had been deluged at the eleventh hour with over 100 pages of evidence and more than 2,000 pages of exhibits, comprising allegations yet to be proven at trial in support of the appellant's stay application. The Court found nothing to suggest that the judge had failed to appreciate the appellant's case for a stay; to the contrary, the judge's recital of the background showed that he was well acquainted with the case. Accordingly, nothing before the judge amounted to "rare and compelling circumstances", and his decision sat comfortably within the generous ambit of his case management discretion. The decision is a clear signal that BVI courts will not lightly stay recognition and enforcement of a final foreign judgment to await collateral foreign proceedings, particularly where no stay has been sought in the originating jurisdiction and the foreign challenge doe...

May 5, 20268 min

By your leave? Cayman experts (maybe) need not apply

In the recent decision of State House Trust v Friend Media Technology Systems the Jersey Royal Court allowed an appeal against the Master's refusal to exclude an opinion from English counsel filed in support of a summary judgment application. Commissioner Sir Michael Birt (who is also a Justice of Appeal of the Cayman Islands Court of Appeal) held that there was no requirement to obtain the leave of the court to obtain evidence from a single expert witness, but that in this instance the opinion was inadmissible, and used the occasion to call for the introduction of a rule equivalent to English CPR 35.4. His analysis of the absence of a requirement for leave raises questions that Cayman Islands attorneys will recognise, because it is not clear that the position under the Grand Court Rules is materially different. Background The proceedings arise out of a shareholder dispute in which three Defendants applied for summary judgment and filed an opinion from English counsel (the Opinion) in support. The Plaintiffs sought to exclude the Opinion – the Master refused, and the Plaintiffs appealed. The judgment Commissioner Sir Michael Birt, hearing the appeal afresh, addressed three issues: 1. whether leave was required; 2. whether summary judgment must be decided on admissible evidence; and 3. whether the Opinion was admissible. He answered yes to the second and no to the first and third issues. It is the first issue – the requirement for leave – that has the most significance for the Cayman Islands. The Plaintiffs argued that Royal Court Rule 6/20(2)(d), which allows the court to "order that not more than a specified number of expert witnesses may be called", read with Practice Direction 17/09, created a leave requirement. The Commissioner rejected that submission. The rule merely empowers the court to limit the number of experts; it does not require leave. The wording is similar to, and Commissioner Birt decided has the same meaning as, the former English Supreme Court Rules Order 38, rule 4, which the English Court of Appeal in Sullivan v West Yorkshire Passenger Transport Executive held gives jurisdiction only to limit numbers, not to exclude expert evidence entirely. The absence of language equivalent to the English CPR 35.4(1), which expressly requires leave, confirmed the position. Commissioner Birt added that he had not reached the conclusion on leave with "any great enthusiasm". He recommended the introduction of a provision equivalent to CPR 35.4, which would impose a simple requirement to obtain the court's leave to submit expert evidence, and this would allow the court to consider admissibility and case management at an early stage. The Cayman position GCR O38, r4 is the Cayman analogue, in materially similar terms to Jersey's RCR 6/20(2)(d): it empowers the court to limit expert numbers rather than imposing a leave requirement. On a strict reading of the GCR, no express leave requirement appears to exist. O38, r36(1) restricts expert evidence unless one of four conditions is satisfied: (i) leave of the court; (ii) agreement of all parties; (iii) an application for a disclosure direction under r37 or r41; or (iv) compliance with automatic directions under O25, r8(1)(b). The third and fourth routes are procedural steps concerning the form and timing of disclosure; they are not applications for permission to call an expert. The party-agreement route is, in particular, difficult to reconcile with a blanket leave requirement. FSD Guide B5.1(a) provides that "[a]ny application for leave to call an expert witness or to serve an expert's report should be made at a case management conference or on a summons for directions". The use of "any" rather than "an" is conditional: it addresses what should happen if such an application is made, not that one must be made. The Guide also uses "should" rather than "must", and as a practice guide issued under the inherent jurisdiction of the court (not a statutory instrument or rule of court...

April 27, 20264 min

Can you repeat that for me? The Grand Court’s approach to continuing the appointment of restructuring officers

The Grand Court of the Cayman Islands recently delivered its judgment in In the Matter of New Ruipeng Pet Group Inc, concerning the continuation of the appointment of restructuring officers (ROs) over New Ruipeng Pet Group Inc (the Company). While the outcome was relatively straightforward on the facts, the judgment provides much-needed guidance concerning the grounds that the Court will consider when determining whether to continue the appointment of ROs given it is the first judgment to consider the issue. On 5 December 2025, ROs were appointed to develop and implement a restructuring plan for the Company and its wider corporate group to avoid a potentially insolvent liquidation. Upon appointing the ROs, the Court also directed that a case management conference be scheduled to assess progress with the restructuring plan. By the hearing on 3 March 2026, the ROs had made some progress developing a restructuring plan but had not yet obtained agreement from key stakeholders. Given liquidity pressures faced by the Company, the ROs advised the Court that they intended to pursue interim financing to stabilise the Company while continuing to pursue a longer-term restructuring of its debt. In this context, Justice Asif KC considered whether it was appropriate for the ROs' appointment to continue. As noted by Justice Asif KC, the judgment addresses interesting jurisdictional questions about the nature of the enquiry the Court must undertake when reviewing the continuation of RO appointments as there was previously no authority that directly addressed the Court's supervisory jurisdiction. The Court first considered the judgment of Kawaley J in Re Holt Fund SPC which dealt with an application to discharge ROs and records that where a consensual restructuring is no longer viable, the ROs will have grounds for their removal. Conversely, the potential for a viable restructuring must exist for the appointment of ROs to continue as detailed below. The Court accepted that the dicta of Cresswell J in Re Trident Microsystems (Far East) Ltd, decided in the context of light-touch provisional liquidations, were relevant by analogy. Cresswell J stated that when the Court is asked to adjourn a winding up petition and permit the continuation of a provisional liquidation, the Court is "in effect exercising its discretion to appoint provisional liquidators afresh" and must give due consideration to all relevant factors. Justice Asif KC determined that this approach should also be applied when considering the continuation of RO appointments. In other words, on each occasion the matter comes back before the Court, the Court must be satisfied that the statutory criteria in section 91B of the Companies Act for the appointment of ROs continue to be met. If they are not, the Court is under a duty to discharge the appointment. After establishing the applicable test, the Court approved the continuation of the ROs' appointment for the following reasons: The Company was, or was likely to become, unable to pay its debts.The Company and the ROs intended to present a compromise to creditors.The restructuring remained feasible and continued to be supported by significant stakeholders.The alternative to restructuring, being a winding up of the Company, was highly likely to result in a significantly worse outcome for stakeholders.Importantly, both the ROs and the Company itself supported the continuation of the ROs' appointment. The Court also bore in mind the warning in Re Aubit that the Court must be astute to ensure that a hopelessly insolvent company is not allowed to continue trading to the detriment of creditors and stakeholders simply by seeking the appointment of ROs. However, there was no suggestion by any party that this concern applied to the Company. Justice Asif KC's judgment is significant given the RO regime in the Cayman Islands remains relatively new. The decision serves as an important pronouncement of the obligations that ROs will be required to ...

April 24, 20264 min

Battle ready: Cayman hands parties pre-action discovery tools

Litigants and prospective litigants are now armed with two new tools for discovery in the Cayman Islands, thanks to the newly-introduced Rule 7A of GCR Order 24. The new rule, which came into force on 30 March 2026 in the Cayman Islands, provides a structured mechanism to obtain discovery of documents before proceedings are commenced and from a non-party to existing proceedings. Rule 7(A) establishes two distinct categories of application. Under Rule 7(A)(1), a prospective litigant may apply to the Grand Court for discovery prior to proceedings being initiated. This application is made by way of originating summons, and the person against whom the order is sought is named as the defendant to the summons. Meanwhile, Rule 7(A)(2) allows a party to existing proceedings to apply for an order for discovery by a person who is not a party to the proceedings. This application is made by summons and must be served on that person personally and on every party to the proceedings. Both types of application must be supported by affidavit evidence. In the case of pre-action discovery, the supporting affidavit must state the grounds on which it is alleged that the applicant and the named person are likely to be parties to subsequent proceedings before the court. In both cases, the affidavit must specify or describe the documents sought and demonstrate, if practicable by reference to any pleading served or intended to be served, that the documents are relevant to an issue arising or likely to arise in the proceedings and that the respondent is likely to have or have had them in their possession, custody, or power. The court retains wide discretion under Rule 7(A)(5) to make the order for discovery conditional on the applicant providing security for the costs of the respondent, or on such other terms as the court thinks just. The discovery order must also require the respondent to make an affidavit stating whether any documents sought are, or have at any time been, in their possession, custody or power, and if not, when they parted with them and what has become of them. Rule 7(A)(6) contains an important limitation: no person shall be compelled by a discovery order under Rule 7(A) to produce any documents he otherwise could not be compelled to produce: in the case of pre-action discovery, if the subsequent proceedings had already begun; orin the case of non-party discovery, if he had already been served with a writ of subpoena duces tecum to produce the documents at trial. The new Rule 7(A) closely mirrors the language of Hong Kong's Order 24, Rule 7A of the Rules of the High Court, which is modelled on the former English Rules of the Supreme Court that also forms the basis of the Cayman Islands provision. There are however noteworthy differences between Rule 7(A) and the equivalent rules in England and Wales, which are set out in UK CPR 31.16 and 31.17. In the case of pre-action discovery, CPR 31.16(1)(d) additionally requires that the disclosure sought must be "desirable in order to dispose fairly of the anticipated proceedings; assist the dispute to be resulted without proceedings; or save costs." For non-party discovery, CPR 31.17(3) requires that the documents sought "are likely to support the case of the applicant or adversely affect the case of one of the other parties to the proceedings; and disclosure is necessary in order to dispose fairly of the claim or to save costs." Coined as the "cards on the table" approach to litigation by the court, the new discovery measures introduced through Rule 7(A) could reduce time and costs of litigation by allowing the prospects of success of disputes to be assessed earlier. This development represents a significant step in Cayman Islands civil procedure rules and brings the Cayman Islands procedural framework into closer alignment with the position in England and Wales and Hong Kong, where pre-action and non-party disclosure rules are well established. If you are contemplating commencing proceed...