Injunctions

Question 1

Interim Prohibitory Injunction

Answer 1

= A temporary injunction requiring the other side to refrain from doing an act which lasts until trial, unless it is discharged before then.

Question 2

Interim Prohibitory Injunction (Procedure in Outline)

Answer 2

(1) Identify that dealing suitable application to make is for an Interim Prohibitory Injunction
(2) State that it is a discretionary remedy - thus, not as of right!
(3) State that because its an injunction, it requires an element of urgency - explain why
(3) State requirement for, and idenitfy, pre-existing / relevant cause of action within the court’s jurisdiction.

Applicant must show that:

• the Respondent has invaded or threatened to invade the applicant’s legal or equitable rights; or
• the Respondent has behaved or threatened to behave in an unconscionable manner.

(4) Point out that American Cyanamid guidelines apply - apply them to the facts.

Question 3

American Cyanamid guidelines

Answer 3

STEP 1: A SERIOUS QUESTION TO BE TRIED

• must established a prima facie case on the merits
• not a detailed consideration of the merits; rather court must be satisfied that CLAIM IS NOT FRIVOLOUS OR VEXATIOUS and that there is a serious question to be tried.

STEP 2: BALANCE OF CONVENIENCE

(i) from Applicant’s perspective…
1. If Applicant succeeded at trial, would he be adequately compensated by damages for any loss caused by court’s refusal to grant injunction?

> harm is serious and likely to continue
harm is irreparable (e.g. reputation, confidentiality lost)
harm is difficult to asses or cannot be quantified in financial terms (e.g. loss of goodwill and reputation)

2. Would the Respondent be in a financial position to pay damages?

IF YES TO BOTH, UNLIKELY TO GRANT INJUNCTION
IF NO TO ONE OR BOTH, MOVE TO (ii)

(ii) from Respondent’s perspective

1. Would the Respondent be adequately compensated by the applicant’s undertaking in damages?
   (i. e. damages sufficient? Or have they missed out on some massive opportunity, which damages cannot address?)
2. Will the Applicant be in financial position to compensate the Reponndent for loss incurred due to the injunction being in place if ,after trial appears that injunction was wrongly granted).

IF YES TO BOTH, NO REASON TO REFUSE THE INJUNCTION - no need to consider anything further !!!!

IF NO TO ONE OR BOTH - COURT MUST DECIDE WHERE THE BALANCE OF CONVENIENCE LIES.
- to do so, will have regard to:

• OTHER FACTORS (could be anything relevant)
• THE STATUS QUO - if other factors evenly balanced, court will try to maintain status quo.
  (This is the position before the Respondent started the conduct that the Applicant is complaining about)

STEP 3: As a last resort, court might consider actual merits of case - but should not be a mini-trial!

Question 4

Defences available to Respondent

Answer 4

• Applicant’s DELAY in bringing the application
• ACQUIESENCE (activity on the part of Applicant)
• CLEAN HANDS - inequitable conduct by Applicant
• HARDSHIP (would’ve been considered in balance of convenience)
• EQUITY DOES NOT ACT IN VAIN - i.e. if the grant of an interim prohibitory injunction would not achieve anything - e.g. because confidential information was already made public.

Question 5

Procedure (in brief)

CPR 25 (Orange)

Answer 5

Procedure is mostly the same as other interim remedies

• Application normally made after issue of proceedings, but cab be made before under CPR 25.2 if matter is urgent and desirable in interests of justice (court will usually direct applicant to file claim form asap after)
• Application can be made on notice (in the usual way) or without notice - court will grant if good reasons for not giving notice (CPR 25.3)
• Without notice only really applies in situations where giving notice would degeat the purpose of the application (e.g. urgent injunctions!)
• Applicant making a without notice application under duty of FULL AND FRANK DISCLOSURE - must thberefore disclose fully matters of which court should be aware, including adverse matters (essentially bring to court’s attention the other side’s argument, in its absence)
• Application Notice, Evidence (witness statement etc.) + Draft Order.
• After a without notice hearing, the Applicant shall notify the Respondent of the application and the order for the injunction should be served on the Respondent..
• Court will set a return date - interim injunction effective until that date - where the matter will be heard and Respondent will have proper chance to argue its case.
• Court will require Applicant to commence the actual proceedings asap, by serving the claim form etc.

Question 6

Freezing Injunctions

Answer 6

An interim order restraining a party from removing assets located within the jurisdiction out of the jurisdiction, or from dealing with assets whether they are located within the jurisdiction or not.
(CPR 25.1 (1)(f))

Purpose is to prevent Respondent’s assets being dissipated in order to frustrate the enforcement of any judgment the Applicant may obtain.

Will be normally restricted to assets not exceeding the value of the claim.

Question 7

Requirements for Freezing Injunctions

For Domesitc Freezing Orders

Answer 7

(1) A CAUSE OF ACTION JUSTICIABLE IN ENGLAND AND WALES
- Applicant must have a cause of action against the Respondent which can be brought in England and Wales (freezing injunction is remedy; not action itself)
(2) MUST HAVE A GOOD ARGUABLE CASE

NINEMIA MARITIME CORPORATION

• ‘good arguable case’ = one which is more than barely capable of serious argument
• not necessarily better thana 50% chance
• this is a more burdensome than for a prohibitory injunction [serious case to be tried] - this needs a good arguable case.

(3) RESPONDENT MUST HAVE ASSETS WITHIN THE JURISDICTION
- Applicant must show good arguable case or grounds for belief that respondent has assets in the jurisdiction (otherwise, equity will not act in vein!)
(4) REAL RISK THAT THE RESPONDENT MAY REMOVE FROM THE JURISDICTION, DISPOSE OF, DISSIPATE OR HIDE HIS ASSETS IN ANY WAY THAY MAY HINDER ENFORCEMENT OF ANY JUDGMENT THE APPLICANT MAY OBTAIN

Relevant factors:

• any evidence that Respondent has been dishonest?
• any incidents of debt default by the Respondent
• any evidence that Respondent has started to remove or dispose of assets?
• where are the respondent’s assets located? Are English judgments enforceable there?
• where is Reponsndent based? Tax haven?

REQUIRES INTENTION ON THE PART OF RESPONDENT TO HINDER ENFORCEMENT!

(5) APPLICANT MUST HAVE SUFFICIENT FUNDS TO INDEMNIFY THIRD PARTIES INCURRING ANY LIABILITY BY COMPLYING WITH THE ORDER.

Applicant will be under duty of full and frank disclosure.