Courier Company Seeks Injunction to Continue Business

On 1 April 2020 the High Court heard injunction applications by Interlink Ireland Ltd (Interlink) (trading as DPD) – a courier company. The applications were made against two individuals who operate as agents for the courier company. It was alleged that as a result of the current crisis the agents were no longer in a position to fulfil their agency agreements with the applicant.

The notice period for termination in these agency agreements is six months but Interlink was informed that the defendants would cease to provide the services on 31 March 2020. The agents stated that they were only willing to continue to provide services if a substantial lump sum was paid to them.

Interlink submitted that the notice provision in the agency agreements was to provide Interlink with an opportunity to make new business arrangements for the areas affected by the proposed terminations. As the company is experiencing an unprecedented level of demand in the current crisis, it would not be possible for it to make suitable arrangements were such a reduced notice period permitted. In applying the test for an interim injunction, Mr Justice Barniville was satisfied on the evidence submitted that the granting of the injunction sought against each defendant was the appropriate remedy.

Remedy

An injunction is an equitable remedy which may be, and usually is, awarded when a wrong cannot be effectively remedied by money damages (our previous articles here and here discuss the legal tests required).

An injunction can also be sought as a temporary restraining measure on an urgent basis and before the full hearing of an action. A mandatory injunction, which was the subject of this case, is an order seeking one party to perform a particular obligation.  In this instance the applicant sought the continued performance of the agents’ obligations in accordance with the agency agreements. This sort of urgent temporary injunction is designed to maintain the status quo which gives rise to the “interim” name given to such injunctions. This type of injunction is granted on an “ex parte” basis meaning it is on the application of one party only to the proceedings. Such interim applications are only heard in urgent matters and the other side is then given the earliest opportunity to be heard. At that stage the Court may decide to lift the injunction or to maintain the status quo until the trial of the action – if so, the interim injunction is then termed an interlocutory injunction. 

One to Watch

Interlink’s interim injunction in this case was made returnable to 3 April 2020, when the defendants were given the opportunity to respond to the claims made against them. The injunction was continued on that date and the case will be heard again on 23 April. 

Injunctive Relief to Assist a Supply Chain?

In a statement issued on 16 March 2020, the High Court confirmed that matters of injunctive relief would continue to be heard. Given this relief is still available in the current circumstances, organisations should consider whether this could be an appropriate remedy to seek as part of a wider rethinking of a company’s supply chain, which we previously considered here.

The Supreme Court recently considered the test to be applied to preliminary injunction cases which we previously considered in detail here. 

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Contributed by Marie McQuail & Niamh McCabe