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Silver was a British Columbia-based mining company. Geolog was a Russian company. In early 1996, Silver and Geolog entered into contractual relations to explore and exploit deposits in Siberia. Geolog had an agreement with Cominco under which Geolog sold concentrate to Cominco. In June of 1998, Silver commenced an action Geolog to recover the Canadian equivalent of $3,213,450.87 (U.S.). This was the sum of various loans Silver had made directly to Geolog and expenses it had paid on Geolog's behalf to the co-defendant, Cominco Ltd. When Cominco was about to pay Geolog approximately $4,000,000 for purchases of concentrate, Silver obtained an ex parte Mareva injunction restraining Cominco from making any further payment to Geolog, and requiring Cominco instead to pay the money into court. Silver further obtained a Garnishing Order Before Judgment against Cominco. When Geolog and Dukat, a Russian supplier to Geolog, successfully had the Mareva injunction and garnishing order set aside, Silver applied for leave to appeal and for a stay of the Chambers Judge's order. Leave was granted, with the variation that Cominco was at liberty to pay Geolog $800,000, the amount by which the amount Cominco owed to Geolog exceeded Silver's claim.

The appeal was allowed in part. The setting aside of the Mareva injunction was maintained. The Court found that it had jurisdiction, under section 9 of the International Commercial Arbitration Act, to order interim injunctions in relation to foreign arbitrations. Then, having reviewed the principles underlying Mareva injunctions in Canadian and English law, the Court concluded that the balance of convenience and justice generally weighed against the granting of an injunction that would prevent a defendant from paying a debt incurred in the ordinary course of business, simply to provide prejudgment security for a plaintiff. Despite this finding, the Court of Appeal reinstated the garnishment order, finding that the lower court erred in holding that the granting of the stay under section 8 of the International Commercial Arbitration Act meant that the garnishment order should be released. The Court found that conditions controlling Mareva injunctions and garnishment orders differed and, more specifically, that there was no authority requiring, as a condition of garnishment, that the debtor be shown to have an intention to avoid paying any judgment entered against it. The defendant did not meet the onus to show that it was just in all the circumstances that the garnishment order be released and the facts militated in favour of its continuance.

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