An injunction is an order issued by the court instructing a party to either carry out a specific act or thing, or to refrain from carrying out that act or thing. This does not include orders imposed by the court requiring a party to make a payment for damages, rather, this refers to things such as:
- The act of transferring ownership of a property to another person
- Staying away from a specific individual or location
- Freezing orders are those that prohibit a person from selling a particular property
- Refraining from making public statements, including posts on Facebook, about another individual
In this article, Injunction Damages, we consider the process and mechanism involved.
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What are the considerations regarding remedies for a breach of contract?
Is there an important question that needs to be considered?
The court must first satisfy itself that the claim is not frivolous or vexatious, and that there is a real chance of the claimant succeeding in a claim for a permanent injunction when the matter is brought before it for a trial. Therefore, despite the fact that the court will not hold a “mini-trial” to determine whether or not the claim has merit, the claim must have enough merit to pass the first barrier.
Would damages be an appropriate form of restitution?
If the damages cannot be quantified and they would not adequately compensate the claimant for the possible loss that would be caused if the injunction was not granted, then the injunction will be granted subject to the balance of convenience test. This means that the injunction will only be granted if it is in everyone’s best interest for it to be granted.
Where should the line be drawn regarding convenience?
After that, the judge will have to decide which party stands to lose the most either way, depending on whether the injunction is granted or not. If the advantages and disadvantages are approximately equal, the court will most likely maintain the status quo.
The concept of damages
Damages are the most common form of compensation given out after a contract has been broken. It is without doubt the most frequently used form of legal recourse for breaches of contract.
When one party to a contract fails to fulfil its obligations under the terms of the agreement, the other party may be entitled to monetary compensation in the form of damages. It is not a remedy that can be chosen at the court’s discretion, unlike other remedies for breach of contract. It’s a right you have; and a remedy in the form of damages is primarily a compensatory form of remedy.
It should be noted that damages as a remedy is not a kind of retribution or punishment. The compensation that is given is not intended to be a form of punishment for the party that is in default for breach, but rather it serves as just recompense for the injustice that was done to the claimant as a result of the breach.
In the majority of circumstances, the amount of money required to put the innocent party into the position it would have been in had the breach of contract not been committed is the amount of money that constitutes that particular measure of damages.
Can injunctions be used as a remedy for breach of contract?
Injunctions, much like specific performance, can be used as a remedy for breach of contract in situations where monetary damages would not be sufficient to resolve the issue. An injunction may be issued, for instance, to guarantee that a party does not disclose confidential commercial material or to prevent a party from disposing of property that is subject to the contract. These are both examples of situations in which an injunction may be appropriate. Injunctions can be one of the following:
- Mandatory – ordering a party to do something
- Prohibitory – ordering a party not to embark on a particular course of action
What is causation?
The “but for” test determines whether or not the “innocent party” is entitled to recover the loss that was incurred “but for the breach”. That’s how you can tell if something caused your loss.
This legal test is the basis for how courts determine the amount of damages that should be awarded for a breach of contract. To put it more simply:
- Assume that the breach didn’t occur
- Calculate the lost profit to the innocent party that was caused by the breach of contract (any other loss that was caused by the breach is also recoverable, such as wasted expenditures)
- Calculate what would have happened under the contract if the breach of contract did not take place and was properly performed
In this regard, it represents the distinction between whether it is possible to contrast what actually took place in accordance with the contract (as it stood at the time of the breach) with what would have taken place if the breach had not taken place (and the contract had been performed).
That is merely the first step in determining what caused what. In the event that the breach was the initial cause of the loss, breaks in the chain of causation are also significant evidence to consider.
After these basic guidelines for determining the amount of damages to be awarded, calculations to determine the amount of damages can become quite difficult.
How we can help
We have a proven track record of dealing with injunctions and litigation. We will guide you through the process and ensure all checks are carried out swiftly and efficiently. We firmly believe that with the right solicitors by your side, the entire process will seem more manageable and far less daunting.
Please click here to find out more about our Commercial Litigation services.
How to contact our Commercial Litigation solicitors
It is important for you to be well informed about the issues and obstacles you are facing. Expert legal support is crucial in terms of reducing risk, saving you money and ensuring you achieve a positive outcome.
To speak to our Commercial Litigation solicitors today, simply call us on 0345 901 0445, or allow a member of the team to get back to you by filling in our online enquiry form. We are well known across the country and can assist wherever you are based. We also have offices based in Cheshire and London.
Disclaimer: This article provides general information only and does not constitute legal advice on any individual circumstances.
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