An injunction is a court order and must be taken extremely seriously. If a person or business fails to comply with the terms of an injunction, the court may treat that failure as contempt of court.
Contempt of court is a serious matter. The courts in England &Wales have extensive powers to enforce injunctions and penalise those who deliberately ignore them. Breaching an injunction can therefore expose individuals, company directors and businesses to significant legal consequences.
This article explains what happens if an injunction is breached and how the courts enforce these orders in commercial disputes.
Why is breaching an injunction treated so seriously?
Injunctions are designed to protect legal rights and ensure that disputes can be resolved fairly by the courts. If parties were free to ignore injunction orders, the authority of the court would be undermined and the purpose of the order defeated.
- For this reason, the courts treat breaches of injunctions as contempt of court.
- The aim of contempt proceedings is both to punish the breach and to ensure compliance with the court’s orders.
Where a breach occurs, the injured party may apply to the court to enforce the injunction and seek appropriate sanctions.
What counts as a breach of an injunction?
A breach occurs where a person knowingly acts in a way that is inconsistent with the terms of the injunction order.
This may include
- continuing conduct that the injunction prohibits,
- failing to carry out steps that the injunction requires, or
- assisting another person in breaching the order.
In commercial disputes, breaches often arise where a party continues to use confidential information, proceeds with transactions that have been restrained by the court, or fails to comply with restrictions imposed by a freezing injunction.
Even partial or indirect breaches may give rise to contempt proceedings if they undermine the purpose of the order.
What penalties can the court impose?
The courts have wide powers when dealing with contempt of court arising from a breach of an injunction.
Depending on the seriousness of the breach, the court may impose a range of penalties. These can include financial penalties, seizure of assets or, in particularly serious cases, a custodial sentence.
For company directors, the consequences may be especially significant if they are personally responsible for the breach of the order. Courts may hold individuals personally liable for contempt where they knowingly permit a company to act in breach of an injunction.
The court may also order the party in breach to pay the legal costs incurred by the other party in enforcing the injunction.
How are breaches of injunctions enforced?
If a party believes that an injunction has been breached, they may apply to the court to bring contempt proceedings.
- This usually involves filing evidence explaining how the breach occurred and why it constitutes contempt of court.
- The court will then consider whether the breach has been proved and what sanctions, if any, should be imposed.
Because contempt proceedings can lead to serious penalties, the courts require clear evidence of the breach and will ensure that the accused party has an opportunity to respond.
What should you do if you are accused of breaching an injunction?
Anyone accused of breaching an injunction should seek legal advice immediately.
Contempt proceedings can have serious consequences, particularly where allegations involve deliberate disregard of a court order. Early legal advice can help determine whether a breach has occurred and what steps should be taken to respond to the allegations.
In some cases, it may also be possible to apply to the court to vary or clarify the terms of the injunction if there is uncertainty about the scope of the order.
Why compliance with injunctions is critical in commercial disputes
Injunctions are an essential tool in commercial litigation because they allow the courts to intervene quickly to prevent harm while a dispute is resolved.
However, their effectiveness depends on strict compliance by the parties involved. Businesses and directors must therefore ensure that they understand the terms of any injunction affecting them and take appropriate steps to comply with the order.
Failure to do so can result in serious legal and financial consequences.
