Interim remedies
Introduction
Prior to or pending a final judicial ruling, legal positions may be provisionally secured. Monetary claims may be secured by arrest of assets, while claims for injunctive relief may be secured by a preliminary injunction.
Regulations applicable to both arrest and preliminary injunction
Jurisdiction/competent court
Jurisdiction in interim remedy matters falls outside the scope of the Lugano/Brussels Conventions, and is thus governed by Norwegian domestic law.
A petition for interim remedies may either be filed with the District Court in whose jurisdiction the respondent is domiciled or, alternatively, with the District Court in whose jurisdiction the asset to be targeted by the remedy is currently located or expected to arrive in the near future.
Procedure
Petitions for arrest or preliminary injunction shall be filed with the competent court. The court shall as a main rule conduct a an adversarial hearing before ruling on the petition. In matters of urgency the court may render a decision based on the applicant's submission alone (ex parte decision). The respondent may then request a subsequent hearing in which the court re-examines the matter.
The hearing normally includes introductory statements from legal counsel, (limited) witness testimony and closing statements from legal counsel. Hearings normally have a duration of 1-5 days, depending on the complexity of the matter.
The process is intended to be swift. Ex parte decisions are normally rendered within a few days. If a hearing is convened, it may take longer, primarily depending on the court's schedule and the parties' availability.
On average, a post-hearing decision is rendered within a few weeks of the petition being filed.
In complex matters, such as those pertaining to patent infringement and invalidation, the courts will occasionally decide that the interim remedy claim shall be adjudicated contemporaneously with the underlying claim before the District Court, in order to avoid having to hear more or less the same case twice. This is not an option if there is an urgent need for interim remedies.
The decision takes effect and may be executed upon being rendered, irrespective of the right of appeal.
Avoidance and discharge of the interim remedy and to the right of appeal
If deemed sufficient to safeguard the interests sought protected by the interim remedy, the respondent may avoid execution of the interim remedy by posting security for the petitioner's monetary interest in such remedy. Usually, security is posted by way of a bank guarantee. Adequate security is always sufficient to avoid arrest.
The respondent may petition to have the interim remedy discharged by the Court by presenting new evidence showing that the basis for such remedy no longer applies.
The court may also make the interim remedy conditional upon the petitioner instituting, by a certain time limit, legal proceedings to have the claim secured by the interim remedy adjudicated.
The District Court's decisions may be appealed and leave to appeal may only be denied if it is apparent that the appeal has no likelihood of being upheld. Normally, the appeal is decided on the basis of written submissions, without any oral hearing, but the appellate court may decide otherwise. An appeal does not have suspensive effect unless applied for by the appellant and deemed necessary by the court under a strict test.
The appeal is normally decided within 2-4 months of the notice of appeal being filed.
Strict liability for loss caused by petitions without merit and security for such liability
If an interim remedy is granted, but it is later found that the underlying claim secured by the measure was without merit, the petitioner carries a strict liability for the respondent's loss resulting from such remedy. In matters in which the remedy prevents the respondent from carrying out business activities, this liability may be substantial and should be carefully considered prior to petitioning for interim remedies.
The court may, as a condition for granting the interim remedy, require the petitioner to post security, ordinarily in the form of a bank guarantee, for the petitioner's potential liability for the respondent’s loss resulting from such remedy.
Legal costs
The ordinary rules on liability for legal costs apply, thus implying that the prevailing party will as a main rule recover its costs from the opponent. As the main rule is that a hearing shall be held before the court, the legal costs incurred in petitioning for interim remedies may be substantial.
Consequences of noncompliance with interim remedies
Noncompliance with the court's orders on interim remedies may be a criminal offence. In addition, the court may in some cases impose daily fines for noncompliance. Grossly negligent or wilful noncompliance with interim remedies may also result in personal liability for individuals acting on behalf of legal entities.
Arrest
An arrest may secure a monetary claim, by imposing restrictions on the respondent's right to legally, and sometimes physically, dispose of the arrested asset to the detriment of the petitioner. It is typically used to prevent an asset that might otherwise serve as security or an asset for recovery of debt from being removed from Norwegian jurisdiction, sold or otherwise brought outside the creditor's reach. It should be noted that an arrest does not constitute a lien or similar security interest, that liens may be attached to an arrested asset by other creditors and that the arrest does not provide protection in case of bankruptcy. Nor does the arrest give a right to enforce the debt.
In addition to presenting the necessary documentary evidence and the legal arguments supporting the petition, the petition must state the amount for which arrest is claimed. The petitioner should also, as far as possible, define the assets to be subject to the arrest. If the matter is urgent, e.g. if the assets are about to leave Norwegian jurisdiction, this fact should be stated and substantiated.
In order to be granted an arrest, the claimant must substantiate, on the balance of probabilities,
- the merits of the monetary claim to be secured; and
- that the respondent’s conduct gives reason to fear that collection of the debt will in the absence of arrest be impossible or considerably impeded.
For seagoing vessels and aircraft, the requirement under (ii) does not apply if the petitioner holds a lien on the vessel for an overdue claim.
If the matter is urgent, the court may grant an arrest ex parte even if the claim is not found to have been substantiated on the balance of probabilities, in which case the petitioner will have to substantiate its claim in the subsequent hearing.
Preliminary injunction
A preliminary injunction may secure a non-monetary claim by ordering the respondent to perform or refrain from certain activities.
In addition to presenting the necessary documentary evidence and the legal arguments supporting the petition, it should state the specific injunctive relief sought. If the matter is urgent, this fact should be stated and substantiated.
In order to be granted a preliminary injunction, the claimant must substantiate, on the balance of probabilities, the merits of the claim to be secured; and either that the respondent's conduct makes it necessary to provisionally secure the claim because the pursuance or execution of the claim would otherwise be considerably impeded; or it is necessary to make a temporary arrangement on a disputed legal issue in order to avert considerable loss or inconvenience.
In addition, a preliminary injunction may not be granted if the loss or inconvenience to the respondent is clearly disproportionate to the interest of the petitioner in the interim remedy being granted.
