Business Environment Group Ltd. v Wendy Fair (Wembley) Group Ltd & Anor

Where an interlocutory injunction is likely to determine the practical outcome before trial, the court must undertake a broad assessment directed to avoiding injustice. It may consider the relative merits, the nature and quantifiability of each party’s potential loss, the claimant’s ability to honour its cross-undertaking, and whether either outcome merely shifts the dispute to damages. A cross-undertaking is not automatically irrelevant because no trial is expected. The guidance in Cayne v Global Natural Resources plc [1984] 1 All ER 225 must be applied with care and cannot fetter the court’s discretion. An injunction may be upheld where the judge has balanced the competing risks and reached a conclusion reasonably open on the evidence.

Business Environment Group Ltd, the leasehold owner of an office building, sought injunctive relief and damages against the operators and owner of a Sunday market. The temporary relocation of the market onto Olympic Way allegedly interfered with vehicular access to the building and amounted to public nuisance, as well as private nuisance, trespass and negligence.

Hart J granted an interlocutory injunction restraining obstructions and market operations in specified areas. The defendants appealed, arguing that the injunction would effectively determine the dispute before trial because the market’s use of Olympic Way was due to end before the likely trial date. The central issue was whether the judge had applied the correct principles in granting relief, including the significance of the claimant’s cross-undertaking in damages.

Appeal dismissed. Lord Justice Neuberger gave the leading judgment, with Lord Justices Jacob and Clarke agreeing.

1. Applicable discretion. The court must approach an interlocutory-injunction application by seeking, in broad terms, to avoid injustice. The statutory discretion cannot be fettered by general statements derived from another case, since the circumstances of such applications vary. The reasoning in Cayne v Global Natural Resources plc [1984] 1 All ER 225 required careful application.
2. Injunction effectively determinative before trial. Where an injunction is likely to expire before the final hearing, the court may assess the relative merits of the parties’ cases. That exercise is difficult and potentially dangerous, but may be appropriate where the timing means that the practical value of the injunction will otherwise disappear.
3. Cross-undertaking and balancing factors. The fact that a defendant may claim on the claimant’s cross-undertaking is not, in every case, an answer against granting relief. It may weigh against an injunction, but the court must balance the competing consequences. Relevant considerations included the apparent strength of the claim, the real but difficult-to-quantify harm to the claimant, the defendants’ certain and readily quantifiable loss, the claimant’s ability to meet the undertaking, the likely practical determinacy of the order, and the nature of any subsequent damages inquiry.
4. Application. Hart J had a well-arguable case before him and considered that the claimant had at least an even, and probably better than even, prospect of success. The claimant’s potential harm was substantial and difficult to assess, whereas the defendants’ potential loss was comparatively small and readily calculable. The judge was therefore entitled to grant the injunction, despite its likely practical effect on the dispute. The appellant was ordered to pay the respondent’s costs, subject to detailed assessment if not agreed.

• Court of Appeal (Civil Division) — In [2005] EWCA Civ 1230, the defendants’ appeal was dismissed. The order granting the interlocutory injunction was upheld.
• High Court (Chancery Division) — Hart J granted an interlocutory injunction restraining specified obstructions and market operations on Olympic Way.