EQUITY SEMESTER 2 CASES

Week 1: Estoppel: Proprietary and Promissory

- Combe v Combe [1951] 2 KB 215
As this doctrine was vastly expanding Lord Denning considered its development and
limitations in Combe v Combe [1951] 2 KB 130, where it was held that this type of estoppel
“did not create a new cause of action where none existed before. It only prevents a party
from insisting on their strict legal rights, when it should be unjust to allow him to enforce
them, having regarding to the dealing that have taken place”. Birkett LJ held in this case the
promissory estoppel is a “shield and not a sword” and as such is not a cause of action but
rather can only be raised as a defence.

- Smyth v Halpin [1997] 2 ILRM 38 [imperfect gifts]

the plaintiff asked his father for a parcel of land on which to build a house for himself. The
father effectively responded by suggesting that the family home would be his after his
mother’s death, and he had no need for two houses. Instead, he should built an extension
onto the family home. The father subsequently made another will which granted the house to
his daughter following the death of his wife. The court found that he had an interest in the
family home and on that basis the interest should be conveyed to him.

- McMahon v Kerry County Council [1981] ILRM 419

Error as to where land boundary was.
Here the High Court held that in the circumstances it would be unconscionable to allow the
plaintiffs to succeed in possession and as a result were only granted damages. In this case
the plaintiffs bought a plot of land for the purpose of building a school but abandoned the
plan and did not visit the land for three years. The plaintiff later realised that the defendant
county council was building on their land, complained and the work stopped. Later the
defendant built two houses on the land, when the plaintiff discovered, they sued for
possession.
Finlay P held that the plaintiff could only recover the market value of the site and damages
given the all the work that had been carried out by the defendant county council. He held
that when the court is applying equitable principles it must consider the conduct of not only
the plaintiff but also the defendant and the consequences of success from both points of
view. Finlay P held:
“If a Court applying equitable principles is truly to act as a Court of conscience then it seems
to me unavoidable that it should consider not only conduct on the part of the plaintiff with
particular regard to whether it is wrong or wilful but also conduct on the part of the defendant
and furthermore the consequences and the justice of the consequences both from the point
of view of the plaintiff and of the defendant.”

Richard v Richard, 900 A.2d 1170 (Rhode Island Sup. Ct. 2006)

State Bank of Standish v. Curry, 500 N.W.2d 104 (Michigan Sup. Ct. 1993)
 Week 2: Tracing

- Shanahan’s Stamp Auctions Ltd v Farrelly [1962] IR 386

Auction off block of stamps. You cant auction off the stamps because they belong to
everybody.
A difficult question arises as to whether this rule is applicable in the complex circumstances
of the present case. It may be that the rule in Clayton’s case does not apply beyond tracing
in a Bank account and the principle may have no application to property acquired by means
of a mixed fund. But I prefer to deal with the situation, for safety sake, as if the principle can
properly be applied to the case of property acquired with such a mixed fund. The practical
position is that, in fact, the investors money has been mixed twice; first, in the original
Banking account, and secondly in the property in the shape of stamps in which the investors
money lies latent, again in a mixed fashion. It is, I gather, possible to trace to some extent
through the companies books the order in which investors money was lodged to the Bank
account). The position is that after this stage it is impossible to say what monies were used
for in the purchase in any particular lot of stamps or to whom the monies were paid. … in
other words, there having been a second mixing of the investors funds into a second mixed
amalgam of property, it would not be possible for any particular investor to say that this
particular money was used before others in the purchase of the property in the shape of
stamps. Tracing, in the exact sense of the term, is therefore not possible or practicable.”
Budd J. also referred to a similar state of affairs arising in Sinclair v. Brougham (1914) A.C.
398 and indicated that the house of Lords took the view that a pro rata distribution was the
practical and equitable solution, leaving it to any particular depositor or shareholder to apply
with a view to tracing his own money into any particular asset.
Further to this Laffoy J concluded that:
“The conclusions I draw from the authorities are that, as far as this Court is concerned, in the
case of a current account such as the account in issue here where trust funds sourced from
various beneficiaries are mixed or pooled in the account, it is settled law that as a general
proposition the rule in Clayton’s case is applicable in determining to whom the balance on
the account belongs.
However, the application of the rule may be displaced in the particular circumstance of a
case, for instance, if it is shown or to be inferred that it does not accord with the intention or
the presumed intention of the beneficiaries of the trust funds.”

- Re Money Markets Int’l Stockbrokers Ltd [1999] 4 IR 267

Laffoy J. expressed the view that in the case of a current account in which the trust funds of
various beneficiaries were mixed or pooled the general proposition is that the rule in
Clayton’s case applies. However, it may be displaced in particular circumstances, such as
where it did not accord with the actual or presumed intention of the beneficiaries of a trust
fund.
On the facts of Re Money Markets, Money Markets Stockbrokers had been suspended by
the Stock Exchange. The liquidator found that over £2.7 million was owed to clients but that
the amount available to satisfy the debt was £1.5 million. The applicant in the case lodge
monies on the day before Money Markets went into liquidation and sought an order directing
the liquidator to either purchase the shares intended or to return the monies. So the rule in
Clayton’s case would have benefitted the applicant as they were the last ones in before
liquidation. You can't go off buying shares when you owe money because it can be
considered someone else’s money. In Money Markets, the monies were still readily
identifiable in the account and Laffoy J permitted the applicant to trace the monies entrusted
by it to the firm for purchasing shares on the day immediately prior to the appointment of a
provisional liquidator to the firm. Laffoy J held that the Liquidator did not have the power to
complete the sale and as such she ordered that the applicant be repaid the full amount
transferred to the company. Any shares purchased by the firm which matched orders made
by individual clients could be said to be traceable.
Laffoy J considered in detail the rule in Clayton’s case and considered the views of Chief
Justice Keane and quoted him as such:
“Even in its application to trust funds sourced from various beneficiaries blended in a single
bank account, the application of the rule in Clayton’s case has been criticised. In Equity and
the Law of Trusts in the Republic of Ireland ,at para. 20.13, Keane J. has described the
application of the rule in such circumstances as “rough justice”; and has further commented
as follows: "It would appear, however, that the rule in Clayton’s case should not apply
where the money is no longer in the bank account; and it may even be doubtful whether the
courts would now continue to apply Clayton’s case (which has always been regarded as
based on rather crude if convenient assumptions) to the case of competing claims of
beneficiaries to money in a bank account.”

- Re Irish Shipping Ltd [1986] ILRM 518

a bank made a duplicate payment in error to the Citibank account of Irish Shipping ltd, and
the company subsequently went into liquidation. Citibank claimed they should be allowed set
off debts due to them by Irish Shipping against the erroneous payment. However, the High
Court held that where the monies are wrongly paid into the account they do not form assets
of the company in liquidation. The Court held that the bank which had in error transferred the
monies was entitled to trace the money into the account.

Westdeutsche v Islington London Borough Council [1996] AC 69 (UKHL)

Week 3: Rectification: Mutual and Unilateral

- Monaghan County Council v Vaughan [1948] IR 306

On the facts, the County Council accepted a tender from the defendant in relation to the
demolition and removal of a building. The intention was that the defendant would pay the
County Council a sum to take away the debris. However, there was ambiguity in the tender
and the defendant sought to take advantage of same and contended that the County Council
was to pay them the sum. On foot of same, the County Council applied to the court for
rectification. In consideration of the same, Dixon J held:
“I am satisfied that it was the intention of both parties that the defendant should pay the sum
of £1,200 to the County Council, and I am of opinion that the defendant saw the error into
which the County Council had fallen when the contract was read over to him and decided to
take advantage of it. I regard this as a case of mutual mistake. I think that it is immaterial that
one party knows the document to be inaccurate for the purposes of the application of the
principles of law applicable to mutual mistake. What is material is that both parties were
agreed upon certain matters and that the completed contract did not correctly represent the
substance of their agreement. A unilateral mistake arises where one of two or more parties
is not ad idem with the other party or parties, and there is therefore, no real agreement
between them. In such a case, rescission may be appropriate, but the present is a different
case. It is not a case of unilateral mistake in that sense, but to speak of it as a case of
mutual mistake may obscure its true character of a common or mutual intention
misrepresented by the record of that intention.”

- Irish Life Assurance Co Ltd v Dublin Land Securities Ltd [1989] IR 253
The plaintiff was selling a portfolio of ground rents of Dublin properties. The Defendant
agreed to purchase the properties but mistakenly other properties subject to CPO were
included. When it came to signing the contracts. Solicitors for the defendant questioned the
properties included, however pressure was placed on the solicitor and he signed the
contract. Subsequently, the plaintiff realised that they had included too many properties and
sought to rectify the agreement, the defendant counter-claimed for specific performance of
the agreement. The rectification was refused and specific performance was order on the
basis that there was no common mistake and rather that there was unilateral mistake rather
than common mistake. The plaintiff had failed to discharge the heavy burden and had only
put evidence of a vague intention before the court rather than a common intention, Griffin J
held that the following: what was said by Denning L.J. (as he then was) in Rose v. Pim
[1953] 2 Q.B. 450 at p. 461:
“Rectification is concerned with contracts and documents, not with intentions. In order to get
rectification it is necessary to show that the parties were in complete agreement on the terms
of their contract, but by an error wrote them down wrongly; and in this regard, in order to
ascertain the terms of their contract, you do not look into the inner minds of the parties —
into their intentions — any more than you do in the formation of any other contract. You look
at their outward acts, that is, at what they said or wrote to one another in coming to their
agreement, and then compare it with the document which they have signed. If you can
predicate with certainty what their contract was, and that it is, by a common mistake, wrongly
expressed in the document, then you rectify the document; but nothing less will suffice.

- Lac Minerals Ltd v Chevron Mineral Corp of Ireland [1995] 1 ILRM 161
A claim for rectification cannot succeed where it is not made by either of the parties involved
in the original agreement but by a party who affected by it.
As a general rule the Courts only rectify an agreement in writing where there has been a
mutual mistake, where it fails to record the intentions of both parties. However, a party that
has entered into an agreement by mistake may be entitled to rectification if he established
that the other party concluded the agreement with knowledge of this mistake.

Week 4: Rescission—Part 1: Misrepresentation, and Undue

Influence
- Northern Bank Finance Corp Ltd v Charlton [1979] IR 149
The plaintiff loaned the defendant a sum of money to buy a public company. The defendants
defaulted on the loan and the plaintiff sued while the defendant counter-claimed for
rescission on the basis of fraudulent misrepresentation. O’Higgins CJ held:
“Where a fraudulent misrepresentation has induced a transaction, the rule is that the person
deceived has the right to rescind the entire transaction; but the right must be exercised in
toto so that every part of the transaction, and everything given or obtained under it, is
cancelled or restored. The representee is not permitted to affirm part and rescind another
part of the same transaction. The fact that the contract has been executed or the transaction
completed is no bar to rescission unless by reason thereof restitutio in integrum has become
impossible. Whether such restitutio has become impossible or not is a matter for
consideration and decision in relation to the facts of each particular case.”

- Gahan v Boland (SC, 20 January 1984) (unreported, but appearing in Delany’s

case book)
A false representation was made in good faith and with no intention to mislead. Rescission
was possible due to the fact that the contract had not been completed and “the
representation was made by the defendant with the intention of inducing the plaintiff to act
thereon and secondly, that the plaintiff did in fact act or rely on that representation.”

- Carroll v Carroll [1999] 4 IR 241 (SC)

Dad is dead. The sisters are suing. Undue influence.

Bank of Nova Scotia v Hogan [1996] 3 IR 23​9

Week 5: Rescission—Part 2: Mistake: Common and Unilateral

- Gun v McCarthy; Gun v M’Carthy (1883) 13 LR Ir 304 (available on Justis—be
sure to click “PDF”) (“LR” is Law Reports, a British reporter)
On the point of unilateral mistake Flanagan J stated that “where there being a
clear undoubted mistake by one party in reference to the material term of a contract which
he entered into with another, and the other party knowingly seeks to avail himself of that,
and seeks to bind the other to the mistake, the law of this Court is, that it will not allow such
a contract to be binding on the parties, but will give relief against it.” This statement would
suggest that it is possible cases of unilateral mistake may be rescindable,

- Solle v Butcher [1950] 1 KB 671 (Eng. Court of Appeal) (Denning, LJ)

No longer good in england, still good here. The parties mistakenly believed that works done
to a flat had been taken outside the rent control system and as such the defendant rented
the flat to the plaintiff for £250 per year. The defendant had failed to comply with procedural
requirements to cap the rent at £140 per year. The plaintiff had sought a declaration that the
rent was at the permitted £140 level; however the defendant appealed and sought
rescission. Denning LJ, in considering Cooper, and held that there was a general equitable
jurisdiction to set aside a contract on the basis of common mistake so long the mistake was
fundamental, material and that the party seeking to rescind was not at fault himself. Lord
Denning held that:
Let me first consider mistakes which render a contract a nullity. All previous decisions on this
subject must now be read in the light of Bell v. Lever Bros. Ld. (2). The correct interpretation
of that case, to my mind, is that, once a contract has been made, that is to say, once the
parties, whatever their inmost states of mind, have to all outward appearances agreed with
sufficient certainty in the same terms on the same subject matter, then the contract is good
unless and until it is set aside for failure of some condition on which the existence of the
contract depends, or for fraud, or on some equitable ground. Neither party can rely or his
own mistake to say it was a nullity from the beginning, no matter .that it was a mistake which
to his mind was fundamental, and no matter that the other party knew that he was under a
mistake. A fortiori, if the other party did not know of the mistake, but shared it. The cases
where goods have perished at the time of sale, or belong to the buyer, are really contracts
which are not void for mistake but are void by reason of an implied condition precedent,
because the contract proceeded on the basic assumption that it was possible of
performance. The mistake there as to the title to the fishery did not render the tenancy
agreement a nullity. If it had done, the contract would have been void at law from the
beginning and equity would have had to follow the law. There would have been no contract
to set aside and no terms to impose. The House of Lords, however, held that the mistake
was only such as to make it voidable, or, in Lord Westbury’s words, ‘liable to be set aside’ on
such terms as the court thought fit to impose; and it was so set aside.

Great Peace Shipping Ltd v Tsavliris Salvage (Int’l) Ltd [2003] QB 679, [2002] EWCA
Civ No. 1407 (Eng. Court of Appeal)
(Phillips, MR)

Week 6: Injunctions—General Principles

- Curust Financial Services Ltd v Loewe-Lack-Werk Otto Loewe Gmbh [1994] 1

IR 450
Finlay CJ held that in reference to the principle that such conduct must be more that
commercial misconduct eg. breach of contract:
“I accept that, the granting of an injunction being an equitable remedy, the court has a
discretion, where it is satisfied that a person has come to the court, as it is so frequently
expressed, otherwise than ‘with clean hands’ by that fact alone to refuse the equitable relief
of an injunction. It seems to me, however, that this phrase must of necessity involve an
element of turpitude and cannot necessarily be equated with a mere breach of contract.”

- Bellew v Cement Ltd [1948] IR 61

The plaintiffs sought an interlocutory injunction to restrain the defendants from carrying out
blasting in a neighbouring quarry. The defendant’s company were the sole manufacturers of
cement in the country at that time, however the blasting was considered to be a nuisance by
the plaintiff. The defendant argued that their product was of central importance to the Irish
building industry, and the injunction, if granted, would cause them to cease production for a
substantial period of time. The majority of the Supreme Court held that the general public
convenience should not be considered in this instance as “this matter is a dispute between
private parties and I think that the court should be concerned, only, to see that the rights of
the parties are safeguarded.”

- Howard v Commissioners of Public Works (HC, 3 December 1992) (unreported,

but appearing in Delany’s case book)
An interlocutory injunction was sought by the plaintiff to restrain the defendant from starting
building works on a interpretive centre in the Burren. Although many factors were considered
by the court, including the conduct of the parties, O’Hanlon J appears to have been
influenced by the wider public interest, primarily from an employment and economic
perspective, in refusing to grant the injunction.

- American Cyanamid Co v Ethicon Ltd [1975] AC 396

In order for a interlocutory injunction to be granted the court must consider:
a) Is there a serious question to be tried (low threshold)
b) Balance of convenience (adequacy of damages as an alternative remedy)
c) Would damages adequately compensate the defendant if he was restrained under the
injunction pending trial.

- Campus Oil Ltd v Minister of Industry and Energy (No 2) [1983] IR 88

It is the leading Irish case in relation to the test for an interlocutory injunction and students
should become familiar with its principles. The Plaintiff was seeking a declaration that an
obligation imposed on it by ministerial order was in breach of EC law. A preliminary
reference was made and the defendants sought an interlocutory injunction to compel the
plaintiff to comply with the ministerial order. O’Higgans CJ in the
Supreme Court endorsed the American Cyanamid test:
“Interlocutory relief is granted to an applicant where what he complains of is continuing and
is causing him harm or injury which may be irreparable in the sense that it may not be
possible to compensate him fairly or properly by an award of damages. In cases where
rights are disputed and challenged and where a significant period must elapse before the
trial, the court must exercise its discretion (to grant interlocutory relief) with due regard to
certain well-established principles. Not only will the court have regard to what is complained
of and whether damages would be an appropriate remedy but it will consider what
inconvenience, loss and damage might be caused to the other party, and will enquire
whether the applicant has shown that the balance of convenience is in his favour.
…….
In my view, the test to be applied is whether a fair bona fide question has been raised by the
person seeking the relief. If such a question has been raised, it is not for the Court to
determine that question on an interlocutory application: that remains to be decided at the
trial. Once a fair question has been raised, in the manner in which I have indicated, then the
Court should consider the other matters which are appropriate to the exercise of its
discretion to grant interlocutory relief. In this regard, I note the views expressed by Lord
Diplock, with the concurrence of the other members of the House of Lords, at p. 407 of the
report of American Cyanamid v. Ethicon Ltd. 4 I merely say that I entirely agree with what he
said. In my view, therefore, the learned trial judge, in considering whether the defendants
had raised a fair question as to whether their rights had been violated, applied the correct
test. I must add that, in my view, such a question had been raised and that the trial judge
was correct in approaching the exercise of discretion on that basis.”
As such the Campus Oil (applicable Irish test), is a three stage test:
1. Is there a fair and bona fide question to be tried?
2. Are damages an adequate remedy?
3. Where does the balance of convenience lie?

Week 7: Specific Performance & Equitable Defences

- Boyle v Lee [1992] 1 IR 555

It was held by Finlay CJ that the deposit is fundamental to the conclusion of a valid
contract/agreement, as well as the amount. This can only be overcome if it was agreed by
both parties that there would not be a deposit. The existence of a note or memorandum are
also not of themselves sufficient to demonstrate that a concluded agreement has taken
place “unless it directly or by very necessary implication recognises, not only the terms to be
enforced, but also the existence of a concluded contract between the parties.” This further
means including terms such as ‘subject to contract’ will satisfy the statutory requirements.
O’Flaherty J suggested in Boyle that there should be an amendment to the Statute of Frauds
to require contracts for the sale of land to be in writing to overcome these issues.

- Co-Operative Insurance Society Ltd v Argyll Stores (Holdings) Ltd [1998] AC 1

******* NB
Landlord suing tenant who breach contract, he moved out. Covenant [provision - i agree to
do this as part of the contract even if you breach]. Contract for 35 years tenancy to operate a
supermarket. Breach by closure of supermarket and removal of fixtures and fittings.
Supermarket was the largest shop in the shopping centre and the biggest attraction of it.
Question of whether covenant specifically enforceable.
- Held - allowing the appeal that the settled practice of the court not grant a mandatory
injunction requiring the carrying on of a business was soundly based baring in mind
in particular the difficulty of drawing the order with sufficient precision to avoid
wasteful litigation regarding compliance with it and that the defendant might suffer far
greater loss by having to comply with the order than the plaintiff would suffer from the
contract being broken thus putting the plaintiff in an

Wanze Properties (Ireland) Ltd v Five Star Supermarket

(High Court, 24 October 1997) (unreported, but appearing in Delany’s case book)
Roberts v O’Neill [1983] IR 47

- Guerin v Heffernan [1925] 1 IR 57

Iura vigilantibus non dormientibus subveniunt: the law comes to the aid of those who are
vigilant
and not those who slumber. it was held that “a man who sleeps on his rights does not find
favour in the court of equity.” There, the defendant attempted to repudiate a contract for the
purchase of land. The plaintiff threatened to instigate an action against him, but did not for a
period of one year. The court found that the defendant might have assumed the plaintiff to
have abandoned his rights under the contract and therefore accepted their claim. On this
basis the order for specific performance was not granted.

Week 8: Injunctions—Positive (Mandatory) and Negative

- Redland Brick Ltd v Morris [1970] AC 652

land owned by the respondents on which a strawberry farm business was operated, was
suffering from subsidence as a result of the quarry and blasting work being carried out by the
appellant on the neighbouring property. The cost of repairing the damage caused by the
subsidence was believed to be wholly disproportionate to the value of the land itself, and the
respondent farmers were granted damages, as well as both prohibitory and mandatory
injunctions to stop further excavation or similar works in the quarry. The House of Lords
however held that “a mandatory injunction can only be granted where the plaintiff shows a
very strong probability upon the facts that a grave damage will accrue to him in the future…
it is jurisdiction to be exercised sparingly and with caution but, in the proper case,
unhesitatingly.”

- Boyhan v Tribunal of Inquiry into the Beef Industry [1992] ILRM 545
the court declined to grant an interlocutory mandatory injunction in favour of the United
Farmers Association. They sought to be granted full legal representation before the Tribunal,
however Denham J found that the level of representation supplied was sufficient.
Denham J believed that “it is up to the plaintiffs to establish a strong and clear case - so that
the court can feel a degree of assurance that at a trial of the action a similar injunction would
be granted.” This seems to have been influenced by the fact that mandatory injunctions are
in her estimation, a ‘power instrument’ which constitute an ‘exceptional form of relief.’

- Dublin Port and Docks Board v Britannia Dredging Co Ltd [1968] IR 136
In Dublin Port and Docks Board v Britannia Dredging Co Ltd, the plaintiff sought an
interlocutory injunction barring the dredging company from removing equipment from the site
where it was contracted to carry out work. As the defendant had agreed to the negative term
and the removal of the equipment would be breach, the injunction was granted.

- Irish Shell Ltd v Elm Motors Ltd [1984] IR 200

Found therefore that while mandatory injunctions in theory follow the same general
principles as any other injunction, different considerations will apply to a mandatory
injunction than to an interlocutory prohibitory injunctions. Otherwise, the determining whether
or not an interlocutory injunction should be granted rests solely on whether or not a
reasonable case was made and that the balance of convenience lies in favour of the
injunctive relief. Some of these may simply be dictated by the very mandatory nature of
these injunctions, and Redland found that “the court must be careful to see that the
defendant knows exactly in fact what he has to do and this means not as a matter of law but
as a matter of fact, so that in carrying out an order he can give his contractors the proper
instructions.”

Week 9: Injunctions—Quia Timet

Redland Brick Ltd v Morris [1970] AC 652 (review this case again)

- Szabo v ESAT Digiphone Ltd [1998] 2 ILRM 102

A plaintiff schoolchildren sought an injunction restraining the defendant from erecting a
mobile phone station in the grounds of a Gardaí station beside their school. Geoghegan J in
refusing the interlocutory relief sought held that:
“(1) There is no difference as between the legal principles to be applied to a quia timet
injunction and those to he applied in the case of any other injunction. Ipso facto there is no
difference between the principles to be applied to an interlocutory quia timet injunction and
those applicable to any other kind of interlocutory injunction. (2) However, the fact that no
breach of the rights of the plaintiffs has taken place as of the date of the hearing is of
relevance in that it may be more difficult to establish, as a matter of evidence, that there is
sufficient risk of future injury to justify the immediate grant of an injunction. In these
circumstances the court must balance the magnitude of the evil against the chances of its
occurrence. (3) In order to grant a quia timet injunction, there would have to be a proven
substantial risk of danger. Attorney General (Boswell) v. Rathmines and Pembroke Joint
Hospital Board [1904] I.R. 161 considered. (4) On an application for an interlocutory quia
timet injunction the issue under consideration by the court is whether there is any risk of
injury arising in the limited period pending the hearing of the action. In this respect the court
is entitled to have some regard to the qualifications, expertise and background of the expert
witnesses relied upon.”

- Attorney General v Guardian Newspapers (No 2) 1990 1 AC 109

In this case, a retired secret service employee of the British government sought to publish
his personal memoirs in Australia. The UK authorities sought to restrain the publication of
the book, and the defendant, Guardian Newspapers, sought to simply report on this original
action. This reporting was also subject to an action, which sought to bar publication of the
facts of the case, as this may lead to details from the memoir being placed in the public
domain. The injunction sought was a prohibitory quia timet, as the authorities believed there
to be future damage arising from any information at all regarding this memoir being reported
upon. The court ultimately held that the author had been subject to a ‘duty of confidence’
towards his employer, the UK secret service. This meant that he was either on notice of or
fully agreed to the confidential nature of his employment, and any work he carried out on
behalf of the secret service. Thus, he should be barred from disclosing that information to
anyone. This duty of confidence subsequently extends to the newspaper in reporting on and
by extension publishing some of the secrets covered by the duty. However, the duty on
third-parties such as the Guardian can be extinguished where the information has already
become public knowledge, or the public interest justified the publication.
In this case, there had been no breach of confidence by the Guardian as its articles
contained readily available information and did not cause further damage.

Week 10: Injunctions—Mareva

Mareva Compania Naviera SA v International Bulkcarriers SA [1980] 1 All ER 213

- O’Mahony v Horgan [1995] 2 IR 411

“Injunctions of this type became known as Mareva  injunctions. A  Mareva injunction is an
ad
personam order, restraining the defendant from dealing with assets in which the plaintiff
claims no right whatsoever. A  Mareva order does not give the plaintiff any precedence over
other creditors with respect to the frozen assets.”
The facts of the above case surrounded the plaintiff’s application as liquidator of a company
of which the defendants were directors. An injunction had been granted in the High Court
and was appealed to the Supreme Court where the injunction was discharged. The Supreme
Court considered that the first question to consider is whether the plaintiff has a good
arguable case rather than a serious question to be tried and further that the dissipation
needs to relate the obligations owed to the plaintiff rather than any other business obligation
“Consequently a Mareva injunction will only be granted if there is a combination of two
circumstances established by the plaintiff i.e. (i) that he has an arguable case that he will
succeed in the action, and (ii) the anticipated disposal of a defendant’s assets is for the
purpose of preventing a plaintiff from recovering damages and not merely for the purpose of
carrying on a business or discharging lawful debts.
In the course of his judgment in Fleming and ors. v. Ranks (Ireland) Ltd. and anor. [1983]
I.L.R.M. 541, the late Mr. Justice McWilliam stated at p. 546 of the report:—
‘I am satisfied that there is jurisdiction to grant such an injunction . . . From the cases cited I
would accept that there must be a real risk of the removal or disposal of the defendant’s
assets, that there must be a danger of default by the defendant, that the plaintiff must show
that he has a good arguable case, and, weighing the considerations for and against the
grant of an injunction, the balance of convenience must be in favour of granting it. See
Barclay-Johnson v. Yuill [1980] 1
W.L.R. 1259 at page 1265.”
……………….
In Polly Peck International Plc. v. Nadir [1992] 4 All E.R. 769 both the Master of the Rolls
and
Scott L.J., stressed that such relief is not intended to give security in advance of judgment
but merely to prevent the defendant from defeating the plaintiffs chance of recovery by
dissipation of assets. Consequently, the cases establish that there must be an intention on
the part of the defendant to dispose of his assets with a view to evading his obligation to the
plaintiff and to frustrate the anticipated order of the court. It is not sufficient to establish that
the assets are likely to be dissipated in the ordinary course of business or in the payment of
lawful debts.”

- Bennett Enterprises Inc v Lipton [1999] 1 ILRM 81

Contract dispute. Pl- investors fund managed by defendants. Genesis and exodus funds.
Falling out. Defendants put restrictions of plaintiffs for withdrawing funds. Defendants said
they had reasons. Defendants saw plaintiffs weren’t returning money to other creditors.
plaintiffs argue other side cannot be trusted. Standards for worldwide morava order - outside
jurisdiction. Court is sympathetic but says morava order should only go as far as 5 million. If
this isn't a tort, burden is on plaintiffs.

- Grupo Mexicano de Desarrollo v Alliance Bond Fund, Inc 527 US 308 (1999)
Alliance Bond Fund and other investment funds (Alliance) (plaintiff) bought unsecured notes
worth $75 million from Mexican company Grupo Mexicano de Desarrollo (GMD) (defendant).
After GMD suffered financial problems and failed to make interest payments, Alliance sued
in the United States District Court for the Southern District of New York with GMD’s consent.
Alliance asked for a preliminary injunction that would bar GMD from transferring assets or
favoring other creditors. Because Alliance demonstrated that winning on the merits was
“almost certain” and that “irreparable harm” would likely occur without an injunction and
Alliance posted a $50,000 bond, the district court granted the injunction. The United States
Court of Appeals for the Second Circuit upheld the injunction, and the United States
Supreme Court then granted certiorari.
The Supreme Court held by a 5-4 majority that “the federal district court lacked the authority,
in an action for money damages, to issue a preliminary injunction preventing note issuer
from disposing of assets in which note holders who sought an injunction claimed no lien or
equitable interest ‘ The Court held that the law would not support the grant of preliminary
injunctions to prevent the disbursement of assets, maintaining ‘;congress is in a much better
position ... to design the appropriate remedy’ for claimants.”
Thus the approach in this instance was that the plaintiff had not established a clear equitable
interest, and more generally, the legislative branch is better placed to deal with such
complex issues than equitable doctrines and remedies such as a mareva injunction.

Week 11: Injunctions—Anton Piller Orders

 - Anton Piller KG v Manufacturing Processes Ltd [1976] Ch 55
Three pre-conditions must be met before the making of such an order and deals with the
practical difficulties in relation to entering the defendant's premises:-
“There are three essential pre-conditions for the making of such an Order, in my judgment.
First, there must be an extremely strong prima facie case. Secondly, the damage, potential
or actual, must be very serious for the applicant, Thirdly, there must be clear evidence that
the defendants have in their possession incriminating documents or things, and that there is
a real possibility that they may destroy such material before any application inter-partes can
be made. The form of the Order makes it plain that the Court is not ordering or granting
anything equivalent to a search warrant. The Order is an Order on the defendant in
personam to permit inspection. It is therefore open to him to refuse to comply with such an
Order, but at his peril either of further proceedings for contempt of Court - in which case, of
course, the Court will have the widest discretion as to how to deal with it, and if it turns out
that the Order was made improperly in the first place, the contempt will be dealt with
accordingly - but more important, of course, the refusal to comply may be the most damning
evidence against the defendant at the subsequent trial.”

- Columbia Picture Industries Inc v Robinson [1987] Ch 38

Scott J opined that “Anton Piller orders are used to prevent a defendant, when warned of
impending litigation, from destroying all documentary evidence in his possession, which
might, were it available, support the plaintiff’s cause of action.”
The case also raised issues relating the potential abuse of AP orders, by saying that “a
decision whether or not an Anton Piller order should be granted requires a balance to be
struck between the plaintiff’s need that the remedies allowed by the civil law for a breach of
his rights should be attainable and the requirement of justice that a defendant should not be
deprived of his property without being heard. What I have heard in the present case has
disposed me to think that the practice of the court has allowed the balance to swing much
too far in favour of plaintiffs and that Anton Piller orders have been too readily granted and
with insufficient safeguards for respondents. The draconian and essentially unfair nature of
Anton Piller orders from the point of view of respondents against whom they are being made
requires, in my view, that they be so drawn as to extend no further the minimum extent
necessary to achieve the purpose for the which they are granted, namely the preservation of
documents or articles which might otherwise be destroyed or concealed.

- Microsoft Corporation v Brightpoint Ireland Ltd [2001] 1 ILRM 540

I am satisfied that there was strong prima facie evidence of dishonest conduct by the
Defendants which indicated a strong probability that they would be likely to destroy the
records (e.g. Tate Access Floors -v- Boswell [1990] ALL ER 303 at 315(e).)”
It was also held that in making an application for an AP order, the plaintiff should err on the
side of excessive disclosure to support their case, as it is the judge and not the plaintiff who
decides what information may relevant in granting or refusing to grant the order.

Week 12: Injunctions—Bayer Injunctions, and end of Semester

Review
- Bayer AG v Winter [1986] 1 WLR 497
This type of injunction prevents a defendant from leaving the jurisdiction. This type of order
is necessitated by the requirement to ensure that court orders are effective. It is most
commonly granted where there has been a prior Mareva injunction or Anton Piller order
which has not been complied with. This type of injunction was created in the case of Bayer
AG v. Winter [1986] 1 WLR 497 in circumstances where a Mareva injunction and Anton Piller
order had been granted but the plaintiff anticipated that the defendant would try to evade
these orders by leaving the jurisdiction. Such an injunction will be granted where it is held to
be just and reasonable to do so and usually for a limited durations; so as to allow a Mareva
injunction or Anton Piller order to be complied with. As above, a defendant can apply to have
such an injunction discharged or varied. This injunction necessarily impacts on constitutional
rights and as such, is granted in very limited circumstances. Held in Bayer:
“the court has a wide discretion to do what appears to be just and reasonable in the
circumstances of the case. The court has to exercise that discretion according to established
principles … It is clear … that the law in relation to the grant of injunctive relief for the
protection of a litigant’s rights pending the hearing of an action has been transformed over
the past 10 years by the Anton Piller and Mareva relief which has greatly extended the law
on this topic as previously understood, so as to meet the needs of justice.
………………..
The time during which the [order] should run should … be of very limited duration. It is an
interference with the liberty of the subject, so that the period should be no longer than is
necessary to enable the plaintiffs to serve the Mareva and Anton Piller orders which they
have obtained, and endeavour to obtain from the defendant the information which is referred
to in those orders.”

- O’Neill v O’Keeffe [2002] 2 IR 1

Here the plaintiff’s sought a Bayer injunction on foot of Mareva injunction an Anton Piller
order that had been made but could not be affected as the defendant was evading the
plaintiff and entry to the premises was being denied to the plaintiff’s solicitor. The following
guidance was given by the High Court:
“It goes without saying that such relief in Ireland can be granted only in exceptional and
compelling circumstances. Any such order is prima facie in breach of the constitutional right
to travel, placing that right in abeyance for the specified period. However, the right to travel
may be curtailed in some instances.
………………..
I am more than happy to adopt the criteria for granting such relief as enumerated by
Courtney in his book Mareva Injunctions and related Interlocutory Orders (Butterworths,
1998) at p. 457, where the author states that such an injunction should only be granted
where:-;(1) The court is satisfied that there is probable cause for believing that the defendant
is about to absent himself from the jurisdiction with the intention of frustrating the
administration of justice and/or an order of the court.
(2) The jurisdiction should not be exercised for punitive reasons ; a defendant’s presence
should be required to prevent a court hearing or process or existing order from being
rendered nugatory.
(3) The injunction ought not to be granted where a lesser remedy would suffice.
(4) The injunction should be interim in nature and limited to the shortest possible period of
time.
(5) The defendant’s right to travel should be out-balanced by those of the plaintiff and the
proper and effective administration of justice.
(6) The grant of the injunction should not be futile.’;