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Injunctions - Coggle Diagram
Injunctions
Mareva injunction
• Definition: freezing order directed towards d whom it is feared may remove, conceal or dissipate its assets prior to attempt to enforce judgment against him (name of injunction is from the first case it was tried, detailed below). It can be granted in advance of the substantive trial of the action but also after judgment, if there is a risk that assets will be removed in order to avoid execution of judgment. Mareva usually interlocutory in nature and awarded pre-trial following an ex parte application. Mareva operates in personam to restrain d from dealing with the assets to which the order relates and it gives no proprietary right over the assets.
• What it is not: will not improve the position of a party who knows that a company is to be wound up and wishes to protect their assets to the exclusion of other creditors. Mareva simply improves the chances of there being funds available.
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• Brussels convention: cooperation of EU in dissipation of asset: applied in Ireland by way of Jurisdiction of Courts and Enforcement of Judgments Act 1998 as amended (1998 Act). Section 13(1) 1998 Act: cts have power to grant provisional, including protective measures e.g. mareva where proceedings are commenced or are about to be commenced in another contracting state, even where p has no independent cause of action in Ireland.
• World-wide Mareva (WFO): effects assets outside of Brussels Convention. Babanaft International: necessity to limit the scope of world-wide Mareva since they have the capacity to produce unconscionable consequences for third parties.
• Evidence required: Third Chandris Shipping: failure by p to make adequate disclosure can result in the subsequent discharge of the injunction.
Proofs required:
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(v) set out grounds for believing assets exist, along with the location of those assets;
• Bambrick v Cobley: inadequate disclosure is alleged, ct should consider the materiality of the facts not disclosed, the extent to which it might be said p was culpable in respect of a failure to disclose and the overall circumstances of the case. Where there is an inference of reasonable risk of evasion of obligation will weigh less strongly where the country where assets are based is a convention country. removal of assets from Ireland to another country can per se give rise to an inference of reasonable risk of evasion of obligation, that judgment will weigh less strongly where the second country is a convention country and where the judgment of the Irish court would be enforceable.
Moloney v Laurib Investments: ct is more likely to infer a risk of disposal where d resides overseas.
Polly Peck International v Nadir: ct would not grant a mareva prior to the establishment of liability if the effect would have a detrimental effect on d’s business.
Powerscourt Estates: Mareva may be granted where it appears that dispositions are likely to be made for the purpose of preventing p from recovering the amount of his award, as distinct from conducting the normal business or personal affairs of d.
O’Mahony v Horgan: Mareva was noted to be a very powerful remedy which if improperly invoked will bring about an injustice, something that it was designed to prevent.
P’s and d’s rights must be balance: Eugene F Collins v Gharion: ct refused an application which sought to restrain d from reducing a cash balance below a figure as d was an unlimited co and directors and shareholders remained liable for debts.
Fleming Ranks: intended dissipation of assets must be shown for the purposes of preventing the d from recovering damages and not simply from carrying on a business and discharging lawful debts.
Bennet Enterprises: requisite intention was qualified by adding that direct intention of evidence to evade would rarely be considered at the interlocutory stage.
Tracey v Bowen: in assessing the risk of dissipation, ct could consider all the circumstances of the case which can include an inference drawn from the wrongdoing. Here insufficient evidence that p would dissipate assets.
Hughes v Hitachi: requisite intention was interpreted to mean established from the facts i.e. if assets were dissipated inconsistent with insolvency law.
Anton Pillar Order
• Definition: order preserves evidence and ensuring that trials are not frustrated due to a lack of evidence is a key factor in litigation. APO is a form of mandatory injunction requiring d to permit p or agents to enter d’s premises to inspect and potentially remove evidence.
• When are they granted: very limited circumstances before the trial of the substantive action, is interlocutory in nature as well as mandatory and qt. There is a duty to make a full and frank disclosure as the evidence is usually heard in camera and its essence is one of surprise.
• Case law: Anton Piller laid down restrictive criteria, applicant must: APO must not be used for “fishing expeditions”.
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(iii) have clear evidence that d has incriminating documents and a real possibility of their destruction before an inter parte application can be made; and
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Ranks Films: If the existence of an APO will expose d to a criminal charge, then d can assert his privilege against self-incrimination.
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Why should I care?
• Time is of the essence: sometimes things need to happen fast, especially if your rights are about to be breached and there is no adequate remedy at law. This calls for the equitable remedy of an injunction. Injunctions are sought in circumstances where maintenance of the status quo until the full hearing of the matter is required to protect the rights of the applicant and to avoid irreparable harm to them in the intervening period.
• Definition: an injunction is where a ct grants a remedy that is either mandatory (do something) or prohibitory (refrain from doing something). Equitable principles apply to the granting of an injunction e.g. you must come to equity with clean hands and laches and delay etc. (google these). Overtime, a whole host of injunctions have developed.
• How does it work: applicant seeks an injunction although respondent is not precluded from seeking an injunction on foot of a counterclaim. An Injunction is not a cause of action, it is a remedy which is binding on any person having notice of the making of the order. A non-party who acts contrary to an injunction when they know of its existence and terms can be guilty of contempt of ct.
Interlocutory injunction
• Interlocutory: an order which is granted to preserve the status quo pending a full determination of the matter. This injunction usually lasts until the determination of the proceedings after a full trial or until a further order is made (that’s how it’s different from the interim order). Therefore, the injunction is temporary in nature and not a determination of the merits of the proceedings.
• Development of the test: the previous view was that an applicant had to satisfy that he had a prima facie case which changed after American Cyanamid as adopted in Ireland in Campus Oil:
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• Undertaking as to Damages: whether on an interim or interlocutory basis, p must also be in a position to provide an undertaking as to damages. This allows d to be compensated for any damage caused as a result of the injunction where p fails on the merits at trial and/or it is found that injunction should not have been granted.
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Quia Timet injunction
• Definition: where there is an injury to p’s rights or injury is anticipated or threatened but has not yet occurred. It can also be sought to prevent the repetition of wrongful acts.
• Requirements: locus standi to initiate any proceedings and there also needs to be an identifiable cause of action i.e. planning law, public or private nuisance, right to earn a livelihood i.e. some right is being interfered. Substantive test for granting of an injunction does not change but additionally, more evidence is required because p must show a substantial risk of danger.
• Case law for test:
Szabo v Esat Digifone: p sought an injunction restraining the d from erecting telephone mast in the grounds of a garda station. Considered relevance of Campus oil, shouldn’t be applied, as balance of convenience of d to carry on with the potential impact it may have on p even if they were to be applied did not establish a serious question to be tried.
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But Szabo is good law. If the QT is prohibitry in nature, Campus Oil applies, if it is mandatory Maha Ligam applies.
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AG v Manchester Corp: p must show a strong case of probability that the apprehended mischief will arise is going too far. Instead, it was preferred to look at whether there was a breach of the p’s rights at the date of hearing, it is more difficult to prove the risk of injury. Therefore, there needs to be a probability of a threatened action.
AG (Boswell) v Rathmines: residents did not want a quarantine hospital being built, albeit no risk of infection was established as evidence. Ct looked for a strong probability almost amounting to moral certainty.
Independent Newspapers: needed to be reasonable probability of what was threatened which is calculated to cause harm to the p.
Interim Injunction
• What is it? where there is an urgent need for injunctive relief and is granted on an ex parte basis (one party making the application in ct and needs to be in upmost good faith as the other party is not there to verify their evidence). This type of injunction is granted for a short period of time i.e. until the hearing of a motion for interlocutory relief (see next: interlocutory injunction).
• Progress to interlocutory hearing/substantive proceedings: when injunctive relief is granted there is a need to continue to promptly prosecute the case either by progressing to an interlocutory hearing or by advancing the substantive proceedings.