Cases - American Cyanamid Co v Ethicon Ltd
Record details
- Name
- American Cyanamid Co v Ethicon Ltd
- Date
- [1975]
- Citation
- A C 396; 1 AII E R 504
- Legislation
- Keywords
- Practice - injunctions - interim injunctions - court's jurisdiction - test for exercise of court's discretion - whether an interim injunction should be granted - serious issue to be tried - adequacy of damages - balance of inconvenience
- Summary
-
The House of Lords set out a three-stage test for the granting of an interim injunction. Before granting an injunction:
- the court must be satisfied that there is a serious question to be tried, i.e. the claim must not be frivolous or vexatious;
- the court must consider the adequacy of damages. This involves two steps:
- the court must consider whether, if the plaintiff were to succeed at trial, damages would be an adequate remedy. If damages would be an adequate remedy and the defendant would be in a financial position to pay them, no interim injunction should normally be granted; and
- the court must consider whether, if the defendant were to succeed at trial, he would be adequately compensated by the plaintiff's undertaking in damages for the loss caused by being prevented from carrying out the work between the time of the application for the interim injunction and the trial. If he would be adequately compensated, then an interim injunction should be granted.
- if there is doubt as to the adequacy of damages to the claimant or the defendant, the court must consider the 'balance of convenience'. In doing this, it will take into account any factors relevant to the facts of the case. If other factors are evenly balanced, then the court should preserve the status quo. For example, if the building works have not been started, preserving the status quo will involve granting an injunction to prevent them being carried out.