Equitable Remedies

Question 1

What remedies are available in equity?

Answer 1

1. Specific Performance
2. Injunctions
3. Rescission
4. Rectification
5. Account

Question 2

Generally speaking when may equitable remedies by awarded?

Answer 2

1. At the courts discretion
2. With equitable maxims in mind
3. When damages are not adequate

Question 3

Describe specific performance.

Answer 3

It is an order requiring a party to a contract to carry out his obligations.

Question 4

What happens if a party does not comply with an order for specific performance?

Answer 4

It is contempt of court and punishable by imprisonment or fine.

Question 5

Why did Sir John Leech VC draw a distinction between land and goods with regards to specific performance in Adderley v Dixon?

Answer 5

Land may have peculiar and special value where goods of the same value can be bought with damages.

Question 6

In what situations may stocks or goods be subject to specific performance?

Answer 6

1. If the stocks are of a private company and therefore unavailable (Duncuft v Albrecht);
2. If the goods are of unusual rarity and beauty, eg a Ming vase (Falcke v Gray)
3. Peculiar or unique value to the claimant (Behnke v Bead)
4. Limited supply (Sky Petroelum v VIP)

Question 7

When may a contract for services be regarded as unique?

Answer 7

When there is no other option except to enforce the services or damages are inadequate (Verrall v Great Yarmouth BC).

Question 8

What limitations are there on applying specific performance to a contract for services?

Answer 8

1. If it requires constant supervision (Co-operative Insurance Society Ltd v Argyll Stores (Holdings) Ltd);
2. It is against policy ie it would turn a contract into slavery (De Francesco v Barnum)
3. It would lead to imperfections in performance (Giles v Morris)
4. s236 Trade Union and Labour Relations (Consolidation) Act 1992 prohibits employers from applying SP to their employees

Question 9

What general limitations are there to applying SP or an injunction?

Answer 9

1. Delay (HP Bulmer and Showerings v J Bollinger SA)
2. Dirty hands/He who seeks equity must do equity (Measures v Measures)
3. Parties don’t have mutual obligations
4. The contract is vitiated by mistake
5. SP would cause unnecessary hardship (Maythorn v Palmer)
6. Acquiescence (Shaw v Applegate)

Question 10

Which statutory provision empowers the High Court to grant injunctive relief?

Answer 10

s37 Senior Courts Act 1981

Question 11

What principle do we take from the case of Day v Brownrigg and Paton v Trustees of British Pregnancy Advisory Service?

Answer 11

To obtain an injunction the claimant must have had a legal right allegedly infringed.

Question 12

What is a quia timet injunction?

Answer 12

An injunction served before an alleged breach is expected to occur (Redland Bricks Ltd v Morris).

Question 13

What does s50 Senior Courts Act 1981 allow the courts to do instead of granting an injunction?

Answer 13

Damages in lieu

Question 14

From which case do we get the guideline test on granting interim prohibitory injunctions?

Answer 14

American Cyanimid Co v Ethicon Ltd

Question 15

What is the test in American Cyanimid Co v Ethicon Ltd?

Answer 15

1. Is the case serious and not vexatious or frivolous, and is there a real chance that a legal right has been infringed (Mothercare v Robson Books)?
2. Does the balance of convenience lie in favour of the claimant?
3. Where the balance of convenience favours neither party the court should apply the status quo ante
4. As a last resort the court may consider the merits of the case.

Question 16

How does the court determine where the the balance of convenience lies?

Answer 16

1. The court apply the adequacy of damages test;
2. The court looks for any other factors which may prevent an injunction being ordered;
3. The court looks at any special factors specific to the claim that may prevent an injunction being ordered.

Question 17

What are the steps to the adequacy of damages test?

Answer 17

1. If the court refused an injunction and the claimant wins the case at trial could the claimant be adequately compensated by damages?
2. Could the defendant pay the potential damages?
3. If yes to both 1 and 2 then no injunction will be awarded;
4. If no, then the court asks if the injunction is awarded and the defendant then wins at trial could the defendant be adequately compensated with damages?
5. Could the claimant pay those damages?
6. If yes, the injunction will be awarded.

Question 18

What other factors may prevent the court ordering an injunction?

Answer 18

1. Loss of employment (Fellows and Son v Fisher);
2. Damage to the goodwill of a business (Associated Newspaper plc v Insert Media Ltd)
3. Closing down a business (Potters-Ballotini Ltd v Weston-Baker)
4. Preserving a substantial investment (Catnic Components Ltd v Stressline Ltd)

Question 19

What is meant by the status quo ante?

Answer 19

The court will order an injunction which maintains the situation as it was before the breach (Garden Cottage Foods Ltd v Milk Marketing Board) unless the claimant delayed his application in which case the status quo ante may be the situation after the breach (Shepherd Homes v Sandham).

Question 20

What is the test for ordering an IMI?

Answer 20

‘a high degree of assurance that at the trial it will appear that the injunction was rightly granted’ per Megarry J in Shepherd Homes v Sandham (confirmed in Locabail International Finance Ltd v Agroexport).

Question 21

What is a search order used for?

Answer 21

Preventing evidence essential to the claimant’s case from being destroyed.

Question 22

What four criteria did Ormord LJ and Denning MR come up with for a claimant to obtain a search order in the case of Anton Pillar v Manufacturing Processes Ltd?

Answer 22

Ormord LJ said there must be no alternative and:
1. an extremely strong prima facie case
2. very serious potential or actual damage
3. clear evidence that D has the offending materials/property and there is a real possibility he will destroy it;
Lord Denning added:
4. Inspection should do no real harm to the defendant or his case

Question 23

Apart from Ormord and Denning LJJ’s directions what else must a claimant do to obtain a search order?

Answer 23

1. Give full and frank disclosure of all materials he intends to acquire;
2. If appropriate give security as an undertaking

Question 24

Who must be in attendance when executing a search order?

Answer 24

A supervising solicitor and the defendant (or a responsible employee), and if the defendant is a woman and she is on her own, then there needs to be a woman in the search party (Universal Thermosensors Ltd v Hibben)

Question 25

When can the search order be executed?

Answer 25

Between 9.30am and 5.30pm

Question 26

What must the claimant’s party have on them during the search?

Answer 26

A list of all the items they are searching for, which the defendant may check (Columbia Pictures Inc v Robinson)

Question 27

Is the defendant obliged to disclose information to the search party that may incriminate him?

Answer 27

No (Rank Film Ltd v Video Information Centre) unless it is technical, commercial or IP information (s72 Senior Courts Act 1981, applied in Coogan v News Group Newspapers Ltd)

Question 28

Which case confirms that search orders don’t conflict with Art 8 ECHR rights?

Answer 28

Chappell v UK

Question 29

In which case was the freezing injunction invented?

Answer 29

Mareva Compagnia Naviera SA v International Bulkcarriers SA

Question 30

What three requirements did the case of Derby & Co Ltd v Wheldon lay down in order to grant a freezing injunction?

Answer 30

1. Good arguable case
2. The assets can be identified in a jurisdiction
3. There is a real risk those assets will be moved or dissipated

Question 31

What is meant by a good arguable case?

Answer 31

“more than barely capable of serious argument, but not necessarily one which the judge considers would have a better than 50% chance of success” (per Mustill J in Ninemia Corp v Trave).