A mandatory interlocutory (during proceedings versus a permanent injunction by way of final judgment on the merits) injunction has a higher threshold to satisfy on the first step of the legal test than a prohibitive injunction. The applicant for the injunction has to show a strong prima facie case on its claim against the defendant, as opposed to merely showing a serious issue to be tried.
The Federal Court recalled the distinction, made in a February Supreme Court judgment, in dismissing an application for an interlocutory injunction directing an ocean carrier to return goods from the port of discharge to Canada, where the goods were loaded, in order to preserve them against an alleged fraud or other claim on the goods.
Mercedes-Benz sought an injunction against Maersk Line as defendant which would have compelled Maersk to return to Canada six vehicles which Maersk had carried to China. Mercedes argued that it was unpaid for the vehicles on conditional sale contracts, in relation to which it had registered security interests. Mercedes was not party to the bills of lading. The injunction was granted on an interim basis, but was dismissed four days later on full hearing.
A mandatory injunction is one that orders a defendant to take a specified course of action – actually do something – as opposed to a prohibitive injunction which merely restrains from a specified conduct. The Federal Court of Canada noted that distinguishing between the two can be difficult, but that there is first of all a heightened first-step test which an applicant has to meet in the case of mandatory injunctions, namely to show that it has a strong prima facie case on its claim against the defendant.
The Court also stressed what is sometimes forgotten: injunction applications are an accessory to the underlying claim. While injunctive relief can sometimes be ordered against someone who is not party to the underlying claim, this was not such a case. Accordingly, Mercedes had to show that it had a strong prima facie case on its claim against Maersk. The Court decided that Mercedes had not framed a sufficient or any claim against Maersk; there was no real complaint as regards Maersk having carried the vehicles to China, and Maersk was really only a party of convenience. The Court seemed to accept Maersk’s argument that it could not simply breach its contract of carriage on request by a third party.