The court considered liability to third partries under a cross-undertaking given to the court: ‘Whether the recoverable damage is that which is foreseeable by the plaintiff or that which is directly caused by the injunction is not in point. None of the differing views expressed in the cases go so far as to say that the injunctee can claim for damage not suffered by him. Nor do the very words of the undertaking (which is the foundation of the jurisdiction) suggest that he can recover more than that which he has suffered, whether that damage is foreseeable by the injunctor or not. Thus while I have sympathy with Mr Howe’s ‘flexible approach’ I do not think it can go so far as to require the ‘wrongful injunctor’ to pay for damage not suffered by the injunctee at all.
I think this consideration also disposes of Mr Howe’s Linden Gardens point. In that case the House of Lords held that damages for breach of a contract between a developer and a builder should include the damage suffered by the purchaser from the developer. The parties could be treated as having entered into the contract on the basis that the developer would be entitled to enforce its contractual rights on behalf of purchaser who suffered the actual damage. The case depended on the parties having full knowledge that the developer was going to pass the property on to the purchaser, so the builder knew exactly who would be suffered if his work was inadequate. Mr Howe suggested that in this case there is a parallel in that SandN expected to have to pay for trading losses. So they did, but they did not undertake to pay for trading losses, they only undertook to pay for Primecrown’s losses. The analogy with Linden Gardens breaks down.’
Judges:
Jacob J
Citations:
[1999] RPC 705.
Jurisdiction:
England and Wales
Citing:
Cited – Linden Gardens Trust Ltd v Lenesta Sludge Disposals Ltd and Others; St. Martins Property Corporation Ltd v Sir Robert McAlpine HL 8-Dec-1993
A contractor had done defective work in breach of a building contract with the developer but the loss was suffered by a third party who had by then purchased the development. The developer recovered the loss suffered by the purchaser.
Held: . .
Cited by:
Cited – Smithkline Beecham Plc and others v Apotex Europe Ltd and others PatC 26-Jul-2005
Application was made to join in further parties to support a cross undertaking on being made subject to interim injunctions.
Held: On orders other than asset freezing orders it was not open to the court to impose cross-undertakings against . .
Lists of cited by and citing cases may be incomplete.
Litigation Practice, Licensing
Updated: 13 July 2022; Ref: scu.231218