Appellant renovating spa baths — Parties disputing adequacy of work — Respondents instructing third party to continue renovation — Appellant refusing to allow third party on site — Respondents obtaining injunction to restrain appellant — Injunction challenged on ground of balance of convenience — Appeal dismissed
The respondent council entered into a contract with the appellant contractor to restore and regenerate buildings erected for the purpose of spa bathing. Problems arose with the paint coating applied to the four bathing pools on the site. The appellant was instructed to remove the paint finishes that it had applied, but it refused to do so. The respondents informed it that, in the event that it failed to comply with the instructions, the council would instruct a third-party contractor to carry out the work, and would charge the costs to the appellant.
The respondents instructed a third-party contractor to remedy the defects but the appellant refused to allow it access to the site. The respondents were subsequently granted an injunction precluding the appellant from preventing access to the third party.
The appellant appealed the injunction.
Held: The appeal was dismissed.
The decisive question for the court was whether the injunction had been properly granted on the balance of convenience.
Although the respondents were a local authority, the situation was not akin to that found in R v Secretary of State for Transport, ex parte Factortame Ltd (No 2) [1991] 1 AC 603. The authority were not acting in the public interest, and they could not be protected by a remedy in damages on the ground that they had suffered no damage. The present case did not involve the performance of, or breach by, the council of any public duty.
The respondents had a contractual right and a legitimate cause of action in respect of that right. If the matter had gone to trial, they would, in all likelihood, have obtained a final injunction. However, under the contract, the respondents were entitled to liquidated and ascertained damages, it was probable, had the matter gone to trial, that the respondents would have suffered a higher level of loss than that provided for. They would have been damaged by the general public’s loss of confidence in them, such damage being exacerbated by the negative effect of the delay upon the local tourist industry. Those damages were unquantifiable and substantially irrecoverable.
On the other hand, the grant of an interlocutory injunction would not cause any loss to the appellant that could not be compensated for in damages. On that basis, the injunction was confirmed.
Nicholas Baatz QC and Chantal-Aimee Doerries (instructed by Withy King Solicitors, of Bath) appeared for the appellant; Timothy Elliott QC and Adam Constable (instructed by Veale Wasbrough Lawyers, of Bristol) appeared for the respondents.
Vivienne Lane, barrister
