Perkier Foods Ltd v Halo Foods Ltd

Where a respondent adduces evidence that compliance with a court order was impossible, the applicant must prove beyond reasonable doubt that compliance was possible. Impossibility negatives the element of choice required for contempt. Difficulty, inconvenience, expense or commercial burden does not suffice.

An interlocutory injunction should be varied or discharged only following a significant change of circumstances or the discovery of previously unavailable material facts. The change may concern any matter relevant to the original exercise of discretion. A court should also consider the resources likely to be required to police a mandatory injunction enforcing a complex commercial contract.

A food-products business obtained an interim mandatory injunction requiring its manufacturer to comply with manufacturing agreements for snack products. The manufacturer supplied defective goods and later ceased production, asserting that the prescribed recipes damaged its machinery and created a risk of plastic contamination.

The claimant applied to commit the manufacturer's managing director for contempt and to sequester the manufacturer's assets. The manufacturer applied to discharge or vary the injunction. The central questions were whether compliance had been possible during each alleged period of breach and whether later access to another manufacturing machine amounted to a significant change of circumstances.

1. The committal application succeeded in part. The first two alleged contempts were not proved. The claimant had not established beyond reasonable doubt that the manufacturer could fulfil the February order or begin successful production on 14 March 2019. The worn distribution rollers probably made production impossible by then.

2. Once a respondent adduces some evidence of impossibility, the applicant must prove to the criminal standard that compliance was possible. A person unable to comply has no choice and therefore lacks the modest mental element required for contempt. Compliance need not be easy, convenient or inexpensive. The defence is confined to genuine impossibility, including potentially legal as well as physical impossibility.

3. The manufacturer received replacement rollers on 19 April 2019. From that date it could have produced the goods using the original recipes, smaller batches and suitable rollers without an unacceptable contamination risk. Its managing director honestly believed otherwise, but failed to undertake readily available production trials or the recommended assessments. As he knew the Order, the failures and the relevant facts, both the manufacturer and its managing director were guilty of contempt by failing to fulfil the March order after 19 April and by failing to fulfil the May order. Sentence was deferred for mitigation.

4. The application to discharge or vary the injunction was dismissed. Under Chanel v FN Woolworth & Co Ltd [1981] 1 WLR 485, an interlocutory issue cannot be relitigated without a significant change of circumstances or newly discovered material facts. Temporary access to another machine did not provide secure long-term manufacturing capacity, so damages remained inadequate. Disclosure failures did not justify discharge. Variation to incorporate unagreed and untested recipes would invite further disputes and require the court to formulate unsuitable technical specifications.

• High Court (Queen's Bench Division): HHJ Blair QC granted an interim mandatory injunction on 21 February 2019 for the reasons given in [2019] EWHC 292 (QB). He refused permission to appeal, and the application was not renewed in the Court of Appeal.
• High Court (Queen's Bench Division): The present court found two alleged contempts proved, declined to discharge or vary the injunction and deferred sentence pending mitigation.