When can the English court protect assets in foreign shareholder proceedings?
In Hughes v Bellamy [2026] EWHC 237 (Ch), the High Court granted urgent interim relief under section 25 of the Civil Jurisdiction and Judgments Act 1982 to protect the assets of two English subsidiaries while related unfair prejudice proceedings continued in the Isle of Man. The decision serves to remind us that, where the real value in an overseas shareholder dispute sits in English companies, the English court can move quickly to preserve the position pending a fuller hearing. On the facts here, a same-day asset disposal, possible connected-party involvement, questions over value, and the absence of prior disclosure were enough to justify a short-term injunction.
What was the shareholder dispute about?
The case arose out of a joint venture between Patrick Hughes and Martin Bellamy. They each owned half of an Isle of Man company, Mulberry Limited, which in turn wholly owned two English subsidiaries: Pathfinder 1 Limited and AI Pathfinder Inc Limited. The venture had been set up in 2025 to develop a sovereign AI business. Pathfinder 1 held an option over English land, while AI Pathfinder was the operating company. Mr Hughes was a director of Mulberry but not of the subsidiaries; Mr Bellamy was a director of both subsidiaries.
The relationship had already broken down over funding and control. Mr Hughes’ case was that both shareholders had agreed to lend £12.5 million each to Mulberry to capitalise the business, with most of that funding to be pushed down into AI Pathfinder. He said he had provided his share and Mr Bellamy had not. Mr Bellamy’s position in the Isle of Man proceedings was said to be different: he denied any such agreement and contended that Mr Hughes had undertaken to provide the full £25 million. Alongside that funding dispute, there were also arguments about authority and governance within the group structure.
For a wider overview of remedies available in shareholder disputes, read our article on actions and remedies in disputes between shareholders.
Why was the English application made so urgently?
The application was triggered by events on 14 January 2026. Earlier that week, Mr Hughes’ solicitors had suggested appointing receivers to preserve assets while the Isle of Man proceedings progressed, and there appeared to be some constructive engagement between the parties. But on 14 January, a letter arrived from AI Pathfinder’s solicitors setting out a deal under which management would acquire the business. Mr Hughes’ complaint was that the bulk of AI Pathfinder’s assets had already been disposed of, without prior disclosure to him, and that the transaction may have been to parties associated with Mr Bellamy and potentially at an undervalue. He issued the English application the next day.
The court was dealing with an alleged asset transfer that had happened the day before the hearing, in circumstances where the claimant said he had been kept out of the picture while negotiations were supposedly continuing. That gave the application a clear commercial purpose: to stop any further movement of value before the defendants had to return to court.
How did the court approach the test for urgent interim relief?
Mr Hughes argued for relief on ordinary interim injunction principles, relying on the American Cyanamid framework and presenting the order as one designed to preserve the status quo pending the unfair prejudice dispute. AI Pathfinder resisted on the basis that the order was, in reality, a freezing injunction by another name, but without the usual safeguards and without sufficiently strong evidence of dissipation.
Given that the order sought was only intended to last until the return date a few working days later, Green J did not consider the debate over labels to be decisive. The judge held that, even assuming a dissipation threshold had to be met, the events of the previous day were enough for present purposes: the timing of the disposal, the questions raised by the sale documentation, the possibility of undervalue, the possibility of an association with Mr Bellamy, and the lack of prior disclosure to Mr Hughes all justified concern. On that basis, the court was prepared to intervene immediately.
The judgment does not erase the distinction between a freezing order and a status quo injunction. What it shows, however, is that on a very short holding application the court may focus less on classification and more on whether there is a real and immediate risk that the substance of the dispute will be damaged before a full argument can take place.
For related analysis on urgent asset protection in a different context, read our article on why parties choose England for crypto recovery.
What order did the Court make?
The court granted the injunction until the return date on 21 January 2026. The effect of the order was to prevent the two English subsidiaries from disposing of or dealing with their assets without the claimant’s written consent, subject to limited carve-outs. Legal expenses could still be paid, and any other payments could be made on 24 hours’ written notice to the claimant.
The judge also accepted that the commercial justification for relief was straightforward. Mr Hughes intended to seek relief in the Isle of Man that would allow him to buy out Mr Bellamy’s shares in Mulberry. That remedy would have little practical value if the subsidiaries beneath Mulberry had already been stripped of their assets. In other words, preserving the English companies was necessary to preserve the usefulness of the overseas proceedings.
Why does Hughes v Bellamy matter in cross-border shareholder disputes?
The case is a real example of section 25 CJJA 1982 doing exactly what it is meant to do: enabling the English court to support foreign proceedings where assets in England require urgent protection before the foreign court can deal with the position itself. In cross-border shareholder disputes, that can be crucial. The holding company dispute may be offshore, but the value may sit in English subsidiaries, English land, English contracts or English cashflows. If those assets move, the foreign proceedings may still continue, but the commercial point of them may be diminished or lost altogether.
The judgment also underlines the importance of evidence. What moved the court here was not abstract suspicion. It was the combination of immediacy and detail: a disposal said to have happened the day before, concerns about who was really behind it, questions over value, and the fact that the transaction had not been disclosed in advance to a 50% shareholder of the parent company.
Parties who can show what has happened, when it happened, and why the transaction raises concern are in a much stronger position than parties relying on broad allegations of mistrust.
Will confidentiality prevent urgent asset preservation relief?
Another point is that confidentiality arguments may not carry much weight on an emergency timetable where the complaint is that assets have already been moved without notice. AI Pathfinder’s explanation was that the deal could not be disclosed because it was covered by non-disclosure, confidentiality and exclusivity obligations. Green J did not treat that as an answer to the immediate risk. At least for the purposes of the short-term order, the court remained satisfied that there was enough to justify intervention.
We discuss related unfair prejudice issues in our article on whether majority shareholders can suffer from unfair prejudice.
Will confidentiality prevent urgent asset preservation relief?
In a cross-border corporate dispute, do not assume that the court hearing the main claim will always be the court best placed to protect the assets. The right strategy may involve parallel steps: substantive relief in the foreign proceedings, combined with targeted protective relief in England where the assets are located. Section 25 can be a powerful part of that toolkit when speed matters.
Equally, speed on its own is not enough. Applications of this kind are far more persuasive when supported by evidence showing what has been transferred, what remains, how the transaction came about, and why there is a genuine risk of further prejudice before the return date. Hughes v Bellamy is therefore best understood as a reminder that the English court will respond decisively where the facts show a real need to preserve value pending a fuller hearing.
Barnes Law’s Commercial Litigation and Dispute Resolution team advises clients on urgent interim relief, cross-border shareholder disputes, unfair prejudice claims, asset preservation strategy and disputes involving English companies within international group structures. For more information, please contact our Commercial Litigation and Dispute Resolution team to discuss how we can support you..
Written by Barnes Law Managing Partner Yulia Barnes.
