Remedies for breach of restrictive covenants

The following Property Disputes practice note provides comprehensive and up to date legal information covering:

  • Remedies for breach of restrictive covenants
  • Damages or injunction—the test
  • Assessment of damages
  • Does delay always mean that damages will be awarded instead of an injunction?

Remedies for breach of restrictive covenants

Damages or injunction—the test

The primary remedy for breach of a restrictive covenant is a permanent injunction to restrain the breach. However, the courts have jurisdiction to award damages instead of an injunction.

The court's jurisdiction is equitable (except in the case of a breach by an original covenantor) so the court has discretion as to the appropriate remedy. The court is entitled to consider conduct, for example, delay or inactivity by the beneficiary as evidence that an award of damages in lieu of an injunction will be appropriate.

In Shelfer v City of London Electric Lighting [1891-94] All ER Rep 838, the court confirmed the ‘working rule’ for awarding damages instead of an injunction was if:

  1. injury to the claimant's legal rights is small

  2. the injury is capable of being valued in money terms

  3. it can be compensated by a small money payment, and

  4. it would be oppressive to the defendant to grant an injunction.

However, in Coventry v Lawrence (a noise nuisance case) the Supreme Court confirmed there were problems with the current authorities on the proper approach to the exercise of the court’s jurisdiction to award damages instead of an injunction due to the conflicting authorities since Shelfer.

It confirmed that the court should adopt a flexible

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