Lecture Notes Excerpts on Injunctions

Nature of Injunctions

An injunction will be awarded either on an interim or a permanent basis, either in a mandatory or

prohibitory form. It is necessary that no common law remedy would be sufficient in the
circumstances; the applicant must come with clean hands; there must not have been delay on the
applicant’s part; some right of the applicant must be affected; and the respondent must not suffer
undue harm as a result of the injunction.

Jurisdiction to grant injunctions

S.64 Civil Procedure Act provides that, in order to prevent the ends of justice from being defeated,
the court if it so prescribes may grant a temporary and in the case of disobedience, commit the
person guilty of it to prison and order that his or her property should be attached and sold.

Lord Nicholls set out the breadth of the power of the courts to grant injunctions in the following
terms in the House of Lords in Mercedes Benz AG v Leiduck to the effect that: the jurisdiction to
grant an injunction, unfettered by statute, should not be rigidly confined to exclusive categories by
judicial decision. The court may grant an injunction against a party properly before it where this is
required to avoid injustice . . . The court habitually grants injunctions in respect of certain types of
conduct. But that does not mean that the situations in which injunctions may be granted are now set
in stone for all time. . . . The exercise of the jurisdiction must be principled, but the criterion is
injustice. Injustice is to be viewed and decided in the light of today’s conditions and standards, not
those of yester-year.3

Therefore, under statute and further to that decision of the House of Lords, the courts have a very
broad, inherent power to grant injunctions in any sort of case in the interests of avoiding injustice.
However, the courts have tended to develop strict principles governing the situations in which
injunctions will be awarded in certain types of case (for example, interim injunctions granted before
a full trial is held). Rather than strict rules governing the grant of injunctions, these will tend to be
broad principles to which the court will ordinarily be expected to have regard when awarding
injunctions in particular types of case. Therefore, in practice it will be important to bear in mind the
criteria which the courts are required to take into account when deciding whether or not to grant an
injunction, and the precise terms of the injunction. The court will be required to take into account
specified types of factors before addressing the precise circumstances of the parties and the most
suitable means for resolving the issues between them. The verb which runs with the expression ‘the
grant of an injunction’ is ‘to enjoin’: thus a court enjoins a person from continuing with an action.

Distinguishing Injunctions from Common law Remedies

It is important to underline the role of the equitable remedy of injunction as a remedy which will be
applied only where the common law will not achieve justice between the parties. Frequently there

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will be a fine line between granting a common law remedy and providing an injunction. A most
useful case on final injunctions generally is the decision of the Court of Appeal in Jaggard v Sawyer.
The facts revolved around restrictive covenants effected between freeholders of land in a residential,
cul-de-sac development. The covenants prevented the freeholders from using any undeveloped land
adjoining their plots, or made part of their plots, for any purpose other than as domestic gardens.
The respondent acquired a plot neighbouring his land and, operating under some misapprehension
as to the status of the land, built an access road across it to his house. A neighbour, the applicant,
sought an injunction to prevent the respondent from maintaining this road, on the basis that it was
in breach of covenant and that it required the respondent to trespass on the applicant’s land. The
applicant had commenced, but not pursued, proceedings when the development started but had
sought injunctive relief once the development had been completed. The issues arose, inter alia, as to
whether the applicant ought to be entitled to the injunctive relief sought and whether in fact
damages would have been a sufficient remedy. In giving his judgment, Sir Thomas Bingham MR
considered the four probanda relevant for the grant of an injunction as set out in Shelfer v City of
London Electric Lighting Co. There are four requirements which must be satisfied before a court
will award damages instead of an injunction in circumstances where an injunction might otherwise
be awarded:

 the harm suffered by the applicant must have been comparatively slight;
 the harm suffered must be capable of being quantified in financial terms;
 the harm suffered must be such that it can be compensated adequately by payment of damages;
 And it must have been oppressive to the respondent to have granted the injunction sought.

Millett LJ considered the question whether damages for the tort of trespass (common law) ought to
be held sufficient such that there would be no requirement for an award of an injunction. He held
that ‘the common law remedy of damages in cases of continuing trespass is inadequate not because
the damages are likely to be small or nominal but because they cover the past only and not the
future’. Therefore, it is possible to contend that, where there is the likelihood of future harm if the
respondent is not enjoined from continuing past behaviour, an injunction will necessarily be a valid
adjunct to common law damages. This argument proceeds on the basis that common law damages
will remedy the applicant’s loss for the past, whereas an injunction will provide a remedy for what
would otherwise be future loss. The two can validly run together without doing violence to the
underlying rationale of either remedy. In the alternative, his Lordship did recognise that this
principle would not apply in all cases. While the main rule is that equity and the common law should
seek to provide remedies in parallel, Millett LJ did acknowledge the utility of an award of damages to
guard against potential future loss when he held that a court ‘can in my judgment properly award
damages “once and for all” in respect of future wrongs because it awards them in substitution for an
injunction and to compensate for those future wrongs which an injunction would have prevented’.

There is also a further issue which arises from Millett LJ’s judgment in Jaggard v Sawyer which
refers to the nature of an injunction and damages as being either compensatory or restitutionary. If
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these remedies are to be compensatory, that would require measuring the loss suffered by the
applicant and providing for a remedy which adequately compensates the applicant for her loss.
Alternatively, a restitutionary remedy is concerned to take from the respondent the gain which the
respondent has made by passing that gain to the applicant. Therefore, the restitutionary remedy
would not necessarily require a calculation of the loss suffered by the applicant, but would instead be
concerned to take from the respondent the gain made at the applicant’s expense. (See Alistair
Henderson, Equity and Trusts)

General Equitable Principles Governing Injunctions

Damages, or other Common law Remedies, must not be an Adequate Remedy

One of the core equitable principles appropriate to awards of injunctions is that it must not be
sufficient to provide a remedy for the applicant that the respondent make a payment of cash
damages, or settle the matter satisfactorily by application of some other common law remedy. This
harks back to the role of equity as a code of principle which existed to shore up shortcomings in the
common law in achieving justice between the parties. Therefore, while equity will take priority over
common law, it is important to establish first that common law will not adequately dispose of the
matter. However, where the court feels that, while damages are available, they would not be an
adequate remedy, an equitable remedy (such as an injunction) will be awarded. The Applicant must
come to Equity with Clean Hands. This venerable equitable principle finds its echo in Lord Browne-
Wilkinson’s explanation of the trust relationship as being built on the conscience of the trustee in
dealing with the trust property. It is a key part of any equitable remedy that the applicant is not
seeking that remedy to advance some inequitable purpose.

The Applicant must not Delay in Seeking the Remedy.

The injunction is generally a remedy which seeks to remove immediate risk of harm from the
applicant. Therefore, it is said that the applicant ought to lose that right where the applicant has
delayed unreasonably in seeking the remedy. As Millett LJ held in Jaggard v Sawyer: ‘If the
applicant delays proceedings until it is no longer possible for him to obtain an injunction,
he destroys his own bargaining position and devalues his right.’

Avoiding delay is one of the core equitable principles. Delay will typically be taken as a sign of
acquiescence in the actions of the defendant and thus disqualify the claimant from obtaining an
injunction and from damages in connection with any such injunction.

Equity will not act in Vain

Where it is impossible to undo the harm done to the applicant by the respondent, the court will not
make an order for an injunction, on the basis that such an order would achieve nothing. Therefore,
the applicant will be required to demonstrate that he stands to suffer some substantial harm which
outweighs the harm which would be caused to the respondent by the award of the injunction.

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However, as a corollary to that, the injunction must contribute to the avoidance of some measure of
harm to the applicant and will not be awarded simply because harm may be suffered.

Some right of the Applicant must be affected

This principle harks back to the notion of locus standi: that an applicant cannot sue on an issue
unless that applicant has some right which is affected by the suit.

While the point is made above that Section 64 CPA provides that the courts have the power to grant
an injunction in all cases in which it appears to the court to be just and to make ends of justice meet,
there is nevertheless a restriction placed on the seeming generality of that principle by the common
law to the effect that the applicant for the injunction must show some effect on a right which it
holds.

In the English case of Paton v British Pregnancy Advisory Service Trustees, it was held by Sir
George Baker P that ‘the first and basic principle is that there must be a legal right enforceable in
law or in equity before the applicant can obtain an injunction from the court to restrain an
infringement of that right’. In line with the principle injunction is required, at root, to support some
existing right of the applicant and will not be awarded generally to prevent harm in the abstract.

The Injunction must not cause undue Hardship to the Respondent

It is important that the court be convinced that the grant of the injunction will not cause
disproportionate hardship to the respondent. The issue for the court will typically be resolved in a
comparison of the comparative hardship to the applicant if the injunction is not granted, and the
likely hardship to the respondent if the injunction is granted. In Jaggard v Sawyer, Sir Thomas
Bingham MR pointed out that ‘the test is one of oppression, and the court should not slide into the
application of a general balance of convenience test’. Furthermore, the material time which the court
must consider in deciding whether or not that oppression exists is at the time the court is asked to
consider whether or not to grant an injunction that equity will not act in vain, considered
immediately above, is an extension that the applicant must not only suffer harm but similarly must
have some legal right affected.

Classification of Injunctions

Injunctions divide between those which require some action from the respondent (mandatory
injunctions), those which require the respondent to refrain from some action (prohibitory
injunctions), and those which seek to prevent some action which it is feared may be performed in
the future. There is a need to distinguish between the various types of injunctions. As mentioned
above, the power of the court to grant an injunction is broad-ranging, and therefore it is important
to be able to classify how different types of injunction might operate.

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Mandatory Injunctions

The mandatory injunction requires that the defendant take some action. For example, where a may
seek to order that defendant to take some action which will stop the water leakage. One means of
doing this would be by way of mandatory injunction to require the defendant to take action to mend
the leak, as well as other actions in respect of damages and so forth. There is a degree of overlap
between the mandatory injunction and specific performance in that both obligations may
seek to force the defendant to perform an action. Specific performance refers specifically to
contractual obligations, whereas a mandatory injunction has broader application outside specific
performance and gives the court greater leeway to impose conditions on its performance.

Prohibitory Injunctions

The prohibitory injunction requires the defendant to refrain from an action.

For example, injunctions may be issued in the family law context to prevent person A from passing
within a given radius of person B’s home. Alternatively, where the defendant’s negligent use of land
is causing water to leak onto another person’s land, the court may make an order by way of
prohibitory injunction to require the defendant to stop the activity which is causing water to escape
onto the other person’s land.

Injunctions quiaTimet

A quiatimet injunction is one which is ordered to protect the applicant from an action which it is
feared may be committed in the future, on the basis that some right of the applicant will otherwise
be infringed.

Literally, the term ‘quiatimet’ means ‘he who fears’, that is, he who fears that he will suffer some
harm. Clearly, this category of injunction stands out from the general principles of equity above
which required that there be some right of the applicant affected. The quiatimet injunction does not
require that some right of the applicant has been affected, only that there is a risk of its being
affected. Therefore, the grant of this type of injunction is typically limited to situations in which
there is a real risk of detriment to the applicant. As Lord Buckmaster held in Graigola Merthyr Co
Ltd v Swansea Corp, ‘a mere vague apprehension is not sufficient to support an action for a
quiatimet injunction. There must be an immediate threat to do something’. It must be
demonstrated that the respondent intends to, or is likely to, participate in the act complained of.
Where the respondent demonstrates a disinclination to participate in the action then the injunction
will not be granted.

Interim Injunctions/ interlocutory injunctions

Interim injunctions are awarded on an interim basis during litigation. Their award is based on a balance of
convenience between the potential harm suffered by the applicant if no injunction were awarded, and the potential
inconvenience caused to the respondent if the injunction were to be awarded. The universal application of this approach
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has been doubted in some more recent cases. The applicant must therefore demonstrate a strong, prima facie case. (See
the Lecture notes (4) for Ugandan Cases on the on the requirements for grant of interim injunction)

The interim injunction is an injunction made during litigation, which is binding on the parties only
up to the date of final judgment. This is opposed to the permanent injunctions considered
immediately above, which are binding on the parties from the date of judgment in perpetuity (or
until the judge expresses them to expire, or until a successful appeal against the injunction).

Consider the following example:

Suppose that Ben, a member of a class of beneficiaries under a discretionary trust, has commenced litigation against T,
the trustee of that trust, claiming that T had breached the terms of the trust by deciding to pay trust income to other
beneficiaries and wind up the trust. Ben will therefore be seeking a declaration that the payments would be in breach of
trust. However, in the meantime, Ben will want to ensure that T does not make those payments before the completion
of the litigation. Therefore, Ben will seek an injunction against T which will prevent T making any such payments
before the litigation is completed. Such an injunction, binding only up to the date of judgment, would be an interim
injunction.

Clearly, the court has subtly different issues at stake here from the final injunctions considered
above. In relation to a final injunction, the court will have heard full evidence from all relevant
parties and will have conducted a full trial of all relevant issues. In that context, the court is able to
reach an informed decision on the most suitable means for disposing of the differences between the
parties. In the case of an interim injunction, there will not have been a trial of the issues between the
parties. Therefore, the court will not have had the opportunity to form an opinion on the merits of
the case.

To award an injunction in favour of one party (the applicant) will prevent the other party (the
respondent) from acting as they otherwise would. It is possible that the respondent would win the
trial and therefore would have suffered detriment for the period of the injunction. However, if the
respondent were permitted to continue to act freely, and then lost at trial, this might cause even
greater loss to the applicant. Therefore, in the example given above, if the court ultimately held that
Ben was correct in his interpretation of the trust, it would have been unjust to deny an injunction to
prevent the trustee from paying the money away. However, in the opposite scenario, if T was held to
have been correct, then it would have been to the detriment of the other beneficiaries if the
injunction had been granted in favour of Ben such that no money was paid out until final judgment.

The Core test – ‘Balance of Convenience’

The classic test for the availability of an interim injunction was contained in American Cyanamid v
Ethicon Ltd. In the words of Lord Diplock, ‘The court must weigh one need against another
and determine where “the balance of convenience” lies.’ Therefore, in considering the mutual
benefits and burdens that may result from the award of an interim injunction, the court is required

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to consider, in all the circumstances, whether it would be more convenient on balance to award or
deny the award.

There are four elements to the test:

a. that the balance of convenience indicates the grant of an award;

b. semble, that the applicant can demonstrate a good prima facie case;
c. that there is a serious question to be resolved at trial; and
d. that there is an undertaking for damages in the event that the applicant does not succeed at trial.

The need for a Strong, Prima Facie case

Lord Diplock also indicated the importance of the applicant showing not only a likelihood of
suffering loss if the injunction is not granted, but also likelihood that the applicant would succeed at
full trial:

To justify the grant of such [an interim injunction] the applicant must satisfy the court first that
there is a strong prima facie case that he will be entitled to a final order restraining the defendant
from doing what he is threatening to do, and secondly that he will suffer irreparable injury which
cannot be compensated by a subsequent award of damages in the action if the defendant is not
prevented from doing it between the date of the application for the [interim] injunction and the date
of the final order made on trial of the action.

However, his Lordship also pointed out that it is impossible for the court at an interim stage to reach a firm conclusion
as to the merits of the case. Therefore, the requirement to show a prima facie case will always stop short of requiring the
applicant to go as far as proving the entire case. The court will, however, consider the relative strength of each party’s
case as it appears from affidavits deposed by each party’s witnesses. These approaches appear to be difficult to reconcile.
The explanation proffered by Laddie J is that Lord Diplock must have required the court to consider the comparative
strengths of the parties’ cases but without needing to resolve any difficult issues of fact or law. His Lordship’s conviction
is that, in most cases, it will be apparent which party is more likely to win at trial.

What approach has been taken in Uganda?

Is the Balance of Convenience test Applicable in all Circumstances?

However, subsequent cases have cast doubt on the breadth of the applicability of American
Cyanamid. In Cambridge Nutrition Ltd v British Broadcasting Association, in a dissenting
judgment, Kerr LJ held that the American Cyanamid principle is not a principle of universal
application. This is in spite of the approach which was adopted by Lord Diplock which suggested
that American Cyanamid was proposing a principle of universal application. The reason why
Cambridge Nutrition was considered to operate on a different footing was that the interlocutory
injunction sought, to prevent the transmission of a current affairs television programme, would have
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been equivalent to the award of a final injunction, not an interim injunction, in those circumstances.
It was in the nature of this particular programme that to prevent its transmission at that time would
effectively mean that the programme could never have been shown. Therefore, Kerr LJ held that
this application for interlocutory relief was different in character to American Cyanamid because it
would dispose of the matter without the need for a full trial. The majority of the Court of Appeal
continued to follow American Cyanamid.

Relationship with Common law Remedies

As with final injunctions, where the applicant would be adequately compensated by an award of
damages the injunction will not be granted. So, if the applicant would suffer only financial loss up to
the date of trial, the court will typically not award an interim injunction. The issue which arises, then,
is as to the solvency of the respondent. It is all very well to say, ‘let’s not award an interim injunction
because damages would be a sufficient remedy’ if the respondent would not be able to pay the
damages owed to the applicant. It is thus common practice to require an undertaking as to the ability
to pay damages. Alternatively, if the applicant is granted an interim injunction but does not
subsequently win at trial, the respondent may well be entitled to damages. In such circumstances, the
respondent will also require an undertaking as to ability to pay damages from the applicant. The
court will typically require that such undertakings are made, and that an ability to pay damages is
demonstrated.

Freezing Injunctions

Freezing injunctions are awarded to prevent the respondent from removing assets from the English
jurisdiction before the completion of litigation to avoid settlement of a final judgment. The applicant
is required to demonstrate three things: a good arguable case; that there are assets within the
jurisdiction; and that there is a real risk of the dissipation of those assets which would otherwise
make final judgment nugatory.

Introduction

The freezing injunction was formerly known as the ‘Mareva injunction’ on account of the case in
which it first appeared.

This form of equitable relief has developed into one of the most powerful tools in the armoury of
private international litigation. The risk addressed specifically by the freezing injunction is that a
defendant in litigation will remove all of its assets from England and Wales, so that it will be
impossible for the applicant to find any assets within the jurisdiction against which it could enforce
the final judgment. See the following example: Suppose that A, a Venezuelan art dealer, had sold a
painting, which A represented was an original version of Dali’s ‘Girl at a Window’, to B, an English
company, for £3 million. In the event it turns out that the painting is a fraud and was painted by an
art student from Bermondsey. Although a good likeness, it is worth only £5,000.

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Assuming the art student to have no money, B would sue A for repayment of the £3 million on
grounds of breach of warranty and fraud. The risk is that A will remove all of her assets from the
jurisdiction by emptying her English bank accounts and selling all other property held in England.
The remedy which B will want up to the date of judgment, and until judgment is satisfied, is an
injunction preventing A from removing any assets from the jurisdiction. In effect, all A’s assets
would be frozen. This would be a freezing injunction. The dilemma for the court is the same as in
relation to any interim injunction. There is a risk of prejudice to A if it transpires that A was not
guilty of fraud or misrepresentation. Alternatively, B’s judgment will be useless where A has no
assets against which the judgment for £3 million could be enforced. Given the risk of the defendant
removing property from the jurisdiction before the court order is made, the hearing is usually held
ex parte (that is, without the defendant being present). This enables the applicant to bind the
defendant before the defendant can spiritassets out of the reach of the courts: a jurisdiction which
may be used by the police or the Serious Fraud Office as well as by private parties to litigation.30

The Nature of the Freezing Injunction

The potentially very broad ambit of the freezing injunction has been limited by the courts. As Kerr
LJ held in Z Ltd v A–Z:

Mareva injunctions should be granted . . . when it appears to the court that there is a combination of
two circumstances. First, when it appears likely that the applicant will recover judgment against the
defendant for a certain or approximate sum. Secondly, when there are also reasons to believe that
the defendant has assets within the jurisdiction to meet the judgment, in whole or in part, but may
well take steps designed to ensure that these are no longer available or traceable when judgment is
given against him.

Therefore the applicant must prove a combination of a likelihood of success at trial, akin to search
(or Anton Piller) orders,32 and that the defendant has some assets within the jurisdiction of the
court to meet that judgment. However, a freezing injunction will not be awarded where such an
injunction would displace remedies which might be ordered at full trial of the issue.33 There is
consequently a ‘high duty’ to be borne by the lawyers for the applicant on the basis that these
injunctions are being sought on an ex parte basis without the other side being notified.34 The
lawyers are required to ensure that any unusual features are brought to the court’s attention and to
ensure that there is a ‘full, fair and accurate disclosure of material information to the court’.35

The Core Test

There are three requirements for the grant of a freezing injunction:

 that the applicant has a good case;

 that the applicant has satisfied the court that there are assets within the jurisdiction; and
 that there is a real risk of dissipation or secretion of those assets which would make a
judgment nugatory.
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 The freezing injunction requires that there is ‘a good arguable case’. This requires the applicant
to declare all matters relevant to the applicant’s claim to the court, so that a rational decision can
be made by the court.37 The test differs from the standard test for interim injunctions precisely
because of the effect which a freezing injunction will have on the defendant in circumstances in
which the defendant is typically not present in court at the original application. A ‘good, arguable
case’ connotes a higher standard than merely a ‘prima facie case’. This is a particularly important
element of the application process given that the hearing is usually ex parte, and the court
requires some evidence that the applicant is likely to succeed at trial. If the applicant is
subsequently shown to have withheld important information from the court, the freezing
injunction will generally be discharged.

The applicant is also required to give an undertaking in damages to the effect that, if the applicant is
unsuccessful at trial, the applicant will be able to compensate the defendant adequately.39 This is an
undertaking made to the court, rather than to the defendant (given the ex parte nature of the
procedure).

The Requirement of Commencement of Substantive Proceedings

A freezing injunction will be ordered whether or not substantive proceedings to which it relates
have already been instituted.41 The traditional view was that a Mareva injunction was an
interlocutory order which is awarded only to keep assets which are the subject of main proceedings
within the reach of the claimant, assuming the test set out in the preceding section is satisfied.
Therefore, an applicant could not be awarded a freezing order in the abstract without bringing
substantive proceedings at the same time. By contrast, cases involving anti-suit injunctions had
suggested that injunctions might nevertheless be awarded in general terms in situations in which ‘it is
appropriate to avoid injustice’, on the basis more generally that ‘the width and flexibility of equity are
not to be undermined by categorization’.

This broader basis for injunctions was predicated on the applicant demonstrating either that the
respondent has invaded or threatens to invade a legal or equitable right of the applicant, or that the
respondent has behaved or threatened to behave unconscionably.43 Therefore, a freezing order may
be made either once proceedings have been served or before substantive proceedings have been
instituted.44 Nevertheless, the court will not make an order for a freezing injunction if it would
place a greater burden on the respondent than would be just and convenient.45 The present position
is set out by the House of Lords in Fourie v Le Roux. The applicant before the House of Lords in
Fourie v Le Roux was involved in litigation concerning the respondent individuals and companies in
South Africa. Through various forms of deception, assets against which the applicant might have
brought a claim had been moved to England. The applicant therefore sought a freezing order over
those assets in England. The basis on which the order was resisted was that the applicant had not yet
brought any substantive proceedings against the respondents and therefore that the court had no
jurisdiction to make a freezing order. Lord Scott held that the trial judge had had jurisdiction to
make an order in the strict sense that the assets and the parties were properly parties before an
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English court. The issue remained whether or not the jurisdiction of the court specifically to make
freezing orders was dependent upon the issue of substantive proceedings which were being
protected by the freezing order.

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