Time can be short when you find yourself needing to seek or oppose an interlocutory injunction. In this quick guide, we outline some of the key features of interlocutory injunctions to help you develop your strategy.
What is an interlocutory injunction?
An injunction is an order made by the Court directing a person to act in a particular way. They can be permanent or interlocutory (meaning that they apply until further order of the Court or conclusion of a proceeding). This quick guide focuses on interlocutory or interim injunctions.
An interlocutory injunction can be mandatory (requiring a person to do something) but are usually prohibitory (requiring a person not to do something). They are often sought in commercial or other civil disputes (e.g. to prevent infringement of intellectual property rights, breaches of contract or misleading and deceptive conduct). They can also be issued in a regulatory context (e.g. to prevent a contravention of the Financial Markets Conduct Act 2013, the Commerce Act 1986, or the Fair Trading Act 1986).
When will an interlocutory injunction be granted?
The Court has a discretion whether to grant an injunction, but will not do so unless the applicant can show three things:
That there is a serious question to be tried (i.e. that the applicant has a real prospect of establishing a legal or equitable right at trial).
That the balance of convenience favours granting the request (i.e. that the risk of doing an injustice to the applicant by refusing the injunction outweighs the risk of doing an injustice to the respondent by granting it). The Court will take into account a range of factors, including:
Whether damages would adequately compensate the applicant if the injunction is refused, or the respondent if the injunction is granted.
The parties’ conduct (e.g. whether there was delay or wrong-doing by the applicant).
Any implications for third parties.
- That it has signed an undertaking to compensate the respondent for any loss caused by the injunction if the applicant’s case ultimately fails.
What is the process?
If negotiations fail and it becomes necessary to involve the Court, the process can be relatively straightforward:
The applicant will usually file and serve a statement of claim, notice of proceeding, notice of interlocutory application, supporting affidavits from key witnesses setting out the factual background, the undertaking as to damages, and a memorandum setting out a proposed timetable.
The respondent will then file and serve a notice of opposition and supporting affidavits, as soon as practicable.
The Court will schedule a hearing, which can be confidential if needed. There is usually no cross-examination.
The Court will strive to make a decision quickly. If an injunction is granted, the respondent must comply with it or risk being held in contempt.
This publication is necessarily brief and general in nature. You should seek professional advice before taking any action in relation to the matters dealt with in this publication.