Sportfive UK Limited v Nottingham Forest Football Club Limited

On an application for an interim injunction, the court must first ask whether there is a serious question to be tried and then assess the balance of convenience. Mandatory relief ordinarily requires a high degree of assurance, but that approach is flexible where the order preserves the existing position and the risk of injustice from refusing relief outweighs the risk from granting it.

A contractual prohibition on disposing of advertising space is a classic negative stipulation. It may be enforced where enforcement does not require substantial supervision or continuing cooperation. Limited operational cooperation will not necessarily make specific performance inappropriate. Prospective loss of goodwill may be difficult to quantify, so damages may be inadequate at the interim stage.

Sportfive UK Limited applied for interim injunctive relief against Nottingham Forest Football Club Limited concerning an exclusive agency agreement for perimeter advertising at the Club’s stadium.

The application sought to restrain the Club from selling or disposing of advertising space and from altering the advertising infrastructure. It also sought positive orders requiring the Club to make advertising boards and an LED display available and to permit advertising to be displayed.

The central issues were whether there was a serious question to be tried concerning termination and breach, whether the relief was inappropriate because it would support a claim for specific performance requiring supervision and cooperation, and where the balance of convenience lay.

1. The application was governed by the American Cyanamid principles. The threshold question was whether there was a serious question to be tried, followed by the balance of convenience.

2. The Defendant accepted that serious questions arose concerning termination, breach and an intention to commit further breaches. The Claimant therefore satisfied the threshold.

3. The suggested bar based on supervision and continuing cooperation did not defeat the application. The court should focus on the particular contractual provisions and the way they operated, while taking account of the wider contractual and commercial context.

4. The prohibition on disposing of advertising space was a classic negative stipulation. It did not require constant supervision and could generally be enforced in accordance with Doherty v Allman. The restrictions concerning the advertising boards likewise required the Club to refrain from specified conduct.

5. The mandatory relief required some cooperation, but the evidence indicated that the Club’s operational role would be minimal. The relief could be formulated so that it did not require substantial supervision or ongoing cooperation. There was accordingly a serious question to be tried on the Claimant’s entitlement to final relief, including specific performance.

6. Damages were not an entirely adequate remedy. Although some losses could be calculated, prospective losses and reputational goodwill were difficult to quantify. The balance of convenience favoured the Claimant, particularly as the Defendant provided no evidence of its prospective losses.

7. Interim injunctive relief was granted on terms including a cross-undertaking in damages. The undertaking did not need to be fortified by a payment into court. The court proposed refined mandatory terms and contemplated listing the matter for a case and costs management conference, with consideration of an expedited trial.