INTERLOCUTORY INJUNCTIONS:

PRACTICAL CONSIDERATIONS
By Steven Mason, McCarthy Tetrault

McCarthy Ttrault LLP

The right people.
The right results.
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Interlocutory Injunctions Practical Considerations1

Introduction

Litigation is often a long and unwieldy process where parties often wait years to enforce their

rights. One important exception to this rule is the interlocutory injunction. Because of the

speed, timing and nature of this remedy, it can prove to be a powerful tool for the

commercial litigator.

Win or lose, an injunction can have an enormous impact on the future course of the litigation.

A successful injunction will have the immediate effect of preventing the other party from

doing what it set out to do (or forcing it to do something it does not want to do). It is a win

for your client and a loss for theirs at an early but critical juncture in the litigation. Often it

ends the litigation entirely. At a minimum, it can provide a serious advantage in any future

settlement negotiations. In effect, the injunction turns the table on the litigation as now it is

the defendant who is looking to the trial award in order to change a course of conduct.

An injunction can be a big win, but it can also prove to be a significant loss. Injunctions can

be expensive to prepare, and an unsuccessful bid can result in a large and immediate award

of costs against your client. Even if granted, an injunction can turn out to be costly. Since

the moving party must give an undertaking as to damages, if the successful moving party

1
By Steven Mason, Partner, McCarthy Tetrault. Mr. Mason would like to gratefully acknowledge the
assistance of David Bross, an articling student at McCarthy Tetrault, in the preparation of these materials.
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ultimately loses at trial, they may be taking out their chequebook and writing a cheque to

cover the damages incurred by the other side as a result of the injunction.

An injunctions is an extraordinary remedy and is granted sparingly. The test for obtaining

one is easy to state but frequently difficult to apply. The secret to success is in understanding

whether your case fits the required test, marshalling the evidence needed to prove it, and

determining the best method to bring this all before a court. If used properly and effectively,

it can provide a powerful remedy for your client at a very early stage.

The Test for Interlocutory Injunctions

The first and most important practical consideration in determining whether to seek an

interlocutory injunction is to determine whether you can win. To do so, you must have

confidence that your clients case meets the criteria for granting injunctive relief.

Although there are various formulations based on the type of injunctive relief the moving

party seeks (see below), the general test in Ontario for an interlocutory injunction is most

often cited to R.J.R Macdonald Inc. v. Canada (Attorney General), [1994] 1 S.C.R. 311. It

established a three-part test for granting an injunction:

1. Is there a serious issue to be tried?;

2. Will the applicant suffer irreparable harm if the injunction is not granted?; and

3. Which party will suffer the greater harm from granting or refusing the remedy
pending a decision on the merits? (often called balance of convenience)
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Serious Issue to be Tried

With some exceptions, the first branch of the injunction test is a low threshold. As stated by

the Supreme Court in R.J.R. : Once satisfied that the application is neither vexatious nor

frivolous, the motions judge should proceed to consider the second and third tests, even if of

the opinion that the plaintiff is unlikely to succeed at trial.2 Justice Heneghan of the Federal

Court explained the review as being on the basis of common sense and a limited review of

the case on the merits.3 It is usually a very brief examination of the facts and law.

In certain circumstances, the court will impose a more restrictive standard and require the

moving party to demonstrate that it has a strong prima facie case. If the injunction will likely

end the dispute between the parties, then the court may hold the plaintiff to this higher

standard. Similarly, where the nature of the relief sought is mandatory or when the question

is a question of mere law alone, then this higher standard will apply.4 The courts have also

required the higher standard in cases involving employment contracts.5

Irreparable Harm

In most injunction cases, proving irreparable harm will be the most significant and most

difficult hurdle to overcome. It is here where most injunctions are won or lost.

Accordingly, it is here where it is suggested that you focus most of your time and effort.

2
R.J.R Macdonald Inc. v. Canada (Attorney General), [1994] 1 S.C.R. 311.
3
Dole Food Co. v. Nabisco Ltd. (2000), 8 C.P.R. (4th) 461 (F.C.T.D.)
4
ibid.
5
Researcho Ltd. Partnership v. Real Estate Search Corp. (2004), 2004 CarswellOnt 4510 (S.C.J.)
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In order to show irreparable harm, the moving party must demonstrate that it is harm that

cannot be quantified in monetary terms or which cannot be cured.6 Harm to third parties will

not be considered. It is only irreparable harm to the moving party. But what exactly is

irreparable harm? Courts seemingly quantify irreparable harm every day, like the award of

damages given to a victim of sexual abuse, or even for pain and suffering from a broken leg.

Robert Sharpe, in Injunctions and Specific Performance, states that irreparable harm has not

been given a definition of universal application: its meaning takes shape in the context of

each particular case.7 Irreparable harm will be considered on a case by case basis.

Whether you are moving or responding, the cases can provide some assistance in gauging

whether your clients damages are incalculable, and it is recommended that you thoroughly

canvass them to determine whether and to what extent your clients case, or that of your

opponents, meets this part of the test. By way of example, courts have held that irreparable

harm includes loss of goodwill or irrevocable damage to reputation, loss of market share

(though not necessarily irreparable if the loss is recoverable) and permanent loss of natural

resources. If the defendant is unable to pay a damages award, the court may consider this as

a factor, though it is not determinative of the issue.8

6
RJR., supra note 2
7
ibid., 2-33
8
Robert Sharpe, Injunctions and Specific Performance, looseleaf, (Aurora, On: Canada Law Book, 1992) p. 2-
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The Balance of Convenience

Here, the courts make a determination as to which party will suffer the greater harm with the

outcome of the motion. The factors considered in making this determination will necessarily

vary with the facts of each case. It is in this part of the test where the court can consider the

harm refusing (or granting) an injunction will have on third parties. If the plaintiff has a

strong case on the merits or there is significant irreparable harm, it may influence the balance

in favour of granting an injunction. The court will look to maintain the status quo in

determining where the balance of convenience lies.

Other Factors

In assessing the three part test, the courts may also consider various other equitable factors

when determining whether to grant injunctive relief, for example whether the moving party

has clean hands, the value of the undertaking as to damages, and in some circumstances

delay.9 Although these factors usually permeate into other sections of the test, they often fit

most neatly in the analysis of the balance of convenience.

Although courts usually apply this three-part test with rigour, there is some fluidity which

gives the court room to manoeuvre. The three components are more of a guide rather than

water-tight compartments.10 As Sharpe writes: Canadian judges have tended to eschew

general statements of principle when deciding interlocutory applications and emphasis has

9
Christopher Werth, Interlocutory Proceedings, looseleaf, (Aurora, On: Canada Law Book Inc., 2004) p. 1-3.
10
Sharpe, supra note 8, 1615 Regent Ltd. v. Kildonan Crossing Shopping Centre Ltd., [1994] M.J. No. 682
(C.A.)
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been placed on the desirability of a healthy measure of discretion. 11 Each part of the test

relates to the other, and strength in one can overcome anothers weakness. This healthy

measure of discretion can sometimes make it difficult to predict the outcome of an

application for injunctive relief.

Framing the Injunction Prohibitory, Mandatory and Quia

Timet

The test for an interlocutory injunction fluctuates depending on the type of relief sought.

There are generally three types of injunctive relief: prohibitive, mandatory and quia timet

orders.

In a prohibitive injunction, the moving party is seeking to prevent the other side from doing

something. This is the most common form of interlocutory relief and the type of relief which

provides the moving party with the greatest chance for success. The guiding principle behind

this type of injunction is maintaining the status quo. For a prohibitive injunction, the law

uses the standard three-part test as laid out by R.J.R..

In a mandatory injunction, the moving party is looking to force the other side to undertake

some positive action. Because of the nature of this remedy and the courts concern over

having to oversee and enforce any order, the courts are also more reluctant to grant this type

of injunction. As a result, the plaintiff is required to show a strong prima facie case in order

to obtain injunctive relief. Another formulation of the higher standard suggests that the court

11
Sharpe, supra note 8
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needs to have a high degree of assurance that at trial it will appear that the relief was rightly

granted.12

Framing the relief requested is therefore an important consideration when moving for an

interlocutory injunction. Because a mandatory injunction requires a higher standard of proof

than a prohibitive injunction (not to mention a greater reluctance on the part of the court to

order such relief), framing your relief in terms of a negative action will increase the chances

of obtaining an injunction if you are the moving party. Conversely, the responding party

should argue that the relief will require a positive action on their clients behalf and therefore

should be considered mandatory in nature.

Quia timet injunctions refer to injunctive relief sought prior to any actual harm occurring.

The moving party is anticipating future harm and is taking pre-emptive steps to avoid it. The

moving party must demonstrate that there is a high degree of probability that the harm will in

fact occur and that the harm is imminent.13

Timing and Notice

Once the decision has been made to proceed with the application for an injunction (i.e., that

you can win it), the next important practical consideration is timing and notice. Do you give

notice and if so, how much?

12
See Ticketnet v. Air Canada (1987), 21 C.P.C. (2d) 38 (O.H.C.J.), Alltricor Financial Management Inc. v.
Romar Group Inc., [2003] O.J. No. 185 (S.C.J.)
13
See Operation Dismantle Inc. v. Canada, [1985] 1 S.C.R. 441 at para. 35, Jagtoo v. 407 ETR Concession Co.,
[1999] O.J. No. 4944 (S.C.J.), Fleatcher v. Bealey (1885), 28 Ch. D. 688 (Eng. Ch. Div.)
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Sometimes, the decision will be clear. If the responding party agrees not to take any steps

until the issue is determined, the injunction can proceed in the normal course as any

significant motion would. Book your date, agree on a schedule, exchange evidence, conduct

cross-examinations, brief the argument and attend for the hearing. By contrast, and not

infrequently, injunctions require quick reflexes and swift action where little or no notice is

possible or even advisable. The notice period you choose to give will determine what you

need to prepare and how you need to prepare -- for the rest of the injunctive proceeding.

No Notice vs. Short Notice vs. Full Notice

Where the relief is not urgent or pressing, or where the other side will agree not to do what is

complained of, the optimal choice is to seek an interlocutory injunction with ample notice to

the other side. This option is the preferred choice especially when the defendant is not

pressing the conduct your client opposes (i.e. they will give you months prior notice of the

launch of their infringing product). The infringing action is not going to occur until some

time in the future and there is no pressing need to have an injunction in place immediately.

Both sides will have time to prepare arguments, conduct cross-examinations on affidavits and

prepare for the hearing and the court will have set aside sufficient time for the parties to

make full argument. The interlocutory injunction, if granted, will remain in place until trial.

Ultimately, this is where the parties will end up but often, this is not how they get there.

Rather, litigators are asked or are required to seek urgent injunctive relief. In these

circumstances, the amount of notice given is an important tactical, and practical,

consideration.
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There are only limited situations which would justify bringing a motion without notice.

Where notice could provoke the very conduct you are trying to prevent, no notice would be

justifiable. For example, in a recent case I was involved in, the proposed defendant was

threatening to repossess a clients airplane. The evidence filed asserted that if notice was

given, there was a significant risk that the defendant would remove the plane from the

courts jurisdiction prior to any injunction. In circumstances like these, where giving notice

will lead to the conduct you are trying to avoid, it may be advisable to bring an injunction ex

parte.

There are important considerations to proceeding ex parte. Courts are generally very

reluctant to grant any injunctive relief without notice to the other party and will entertain ex

parte injunctions on rare occasions.14 More often, Judges will require the moving party to

give some notice to the other side An ex parte injunction is also time limited. Rule 40.02 of

the Ontario Rules of Civil Procedure allows the court to award an interlocutory injunction or

mandatory order without notice for a period of up to 10 days. There is also a 10-day limit for

ex parte injunctions granted by the Federal Court. Therefore, it does not prevent the

necessity for a full argument.

Perhaps most importantly, proceeding ex parte requires the moving party to make full and

frank disclosure.15 Failure to do so is itself sufficient grounds for setting aside any order

obtained on the motion or application. Therefore, the moving party has a significant burden

to go before the court with all the evidence it has in its possession relating to the motion,

14
See Launch! Research & Development Inc. v. Essex Distributing Co., [1977] O.J. No. 1451 (H.C.J.)
15
Rule 39.06, Rules of Civil Procedure
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good or bad. The court takes this requirement very seriously. If the court determines that

notice ought to have been given, then you will have unnecessarily argued the case for the

other side in your own materials.

Another option for time-sensitive relief is giving short notice and seeking interim relief

pending a full hearing on the merits. The amount of notice you give will depend on the

circumstances of your case. It should be commensurate with the urgency of the relief sought.

In most situations, short-serving the other side will require them to seek an adjournment in

order to prepare responding material. Depending on the amount of notice given, there is

usually insufficient time to conduct cross-examinations. Often there is insufficient time for

the other side to prepare responding material. The issue for the court will be to determine

whether and what terms should be ordered (sometimes referred to as interim, interim

relief). Favourable adjournment terms can have a strong impact on the future course of the

injunction application, for it may cast the status quo.

The issue for the court to determine on a request for interim relief is whether the moving

party will suffer irreparable harm pending a full hearing of the injunction. Once the issue of

interim relief is resolved, the parties should arrange, either on consent or by order, to

exchange further evidence (as necessary or permitted), conduct cross-examinations,

exchange facts, and attend for a full hearing on the merits of the request for an interlocutory

injunction.

Parties should not wait too long in deciding whether to bring an injunction. In Dole Food

Co. v. Nabisco Ltd. (1997) 8 C.P.R. (4th) 367 (F.C.T.D.), an interim injunction was refused
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partly because Nabisco had waited just over two months after discovering Dole was to launch

a product which could be confused with its brand to bring the motion. In that time, Dole had

entered into contracts and spent money in anticipation of launching its product.

The Evidence

Marshalling the evidence is probably the most important step in preparing for an

interlocutory injunction. Since all the evidence will be likely be paper-based, it is important

to ensure the affidavits contain all the relevant information necessary to satisfy the court that

an injunction is warranted. The quality and quantity of evidence will vary depending on the

nature of the case and the type of injunctive relief you seek.

For a prohibitive injunction, the first branch of the test is generally easy to meet. Since the

court will only take a cursory look at the merits of the case, you should ensure that all legal

steps that need to be proven are addressed although proving them is not necessary. For a

mandatory injunction, strong evidence will be necessary. You will need to show the court

that success is likely on the merits. You may want to consider adducing expert evidence.

Invariably, the most important evidence you will require when preparing materials for an

interlocutory injunction is the affidavit evidence proving irreparable harm. No matter how

well you have planned for the injunction and no matter how strong your case on the merits, if

you cannot prove that the harm is irreparable, you will not get your remedy.
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There are various considerations when developing your evidence on irreparable harm. First,

evidence of irreparable harm must be clear and not speculative.16 It is absolutely necessary

to put evidence before the court of irreparable harm; any actual customers lost, market loss or

other irreparable damages. This is usually done by filing an affidavit of a knowledgeable

employee of the moving party. More frequently, litigants have been tendering expert

affidavits (such as those from forensic accountants or business valuators) to assist in proving

irreparable harm.

As well, the evidence before the court needs to be more than just a potential for irreparable

harm. For example, the Federal Court ruled in a recent case that the evidence tendered, that

confusion may lead to various scenarios which would cause a loss of customers, was too

speculative.17 The court found that the confusion did not lead to any loss.

It is important to ensure your evidence is not just that general harm will occur but goes

specifically to the irreparable nature of the harm. You cannot succeed unless you show

evidence to the court that damages are not an adequate remedy.18

One good example of the necessity to make a case for irreparable harm comes from Dole

Food Co. v. Nabisco Ltd. (2000) 8 C.P.R. (4th) 461 (F.C.T.D.). Nabisco was seeking an

interim injunction against Doles launch of a new product called Fruit Bowls. In support,

Nabisco filed affidavits of its VP of marketing (who provided evidence both for the company

and as an expert) and Dr. Dawar, an expert in marketing management, both of who indicated

16
Centre Ice Ltd. v. National Hockey League, (1994), 53 C.P.R. (3d) 34, Kanda Tsushin Kogyo Co. et al v.
Coveley et al. (1997), 96 O.A.C. 324 (Ont. Div. Ct.)
17
Boston Pizza International Inc. v. Boston Market Corp. (2003) 26 C.P.R. (4th) 78 (F.C.T.D.)
18
See Canada (A.G.) v. Archibald (1984), 79 C.P.R. (2d) 287 (F.C.A.)
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that if not enjoined, Nabisco would suffer harm to its reputation, goodwill and trade mark.

Despite this evidence, the court denied the injunction, saying the evidence was insufficient to

meet the evidentiary burden. Citing Justice Rothstein in Effem Foods Ltd. v. H.J. Heinz Co.

of Canada Ltd. (1997), 75 C.P.R. (3d) 331 (F.C.T.D.):

Sophisticated participants in the market place such as these

litigants should be able to provide the Court with an indication
of loss based upon historical experience and a mathematical or
statistical analysis of the circumstances demonstrating that the
loss is not reasonably calculable which would give the Court
some degree of confidence that the kind of loss being alleged
would indeed occur and cannot be calculated.

The court went on to say that Nabisco had not laid the foundation for irreparable harm, even

though it was apparent that there was potential for harm to the marketing strategy and market

share of Nabisco. Absent some evidence as to actual sales, projected sales and projections as

to the impact, the court was not persuaded of irreparable harm.

Conclusion

Interlocutory injunctions can provide the litigator with a very useful tool. When exercised

properly, it has the benefit of speed, flexibility and a powerful result. All this is overridden if

you do not think strategically and properly prepare for your motion or application. Unless

you have a solid grasp on the concepts, procedure and evidence, you may be blunting the

sharpness of the tool.

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