LEGAL PRINCIPLE: CIVIL PROCEDURE – Undertaking as to damages not an absolute condition for interlocutory injunction – Undertaking as to Damages as Price for Interlocutory Injunction
PRINCIPLE STATEMENT
An undertaking to pay damages is the price which the person asking for an interlocutory injunction has to pay, and it ought to be required on every interlocutory order, whether or not the plaintiff has been guilty of misrepresentation or suppression.
RATIO DECIDENDI (SOURCE)
Per Iguh, JSC, in Afro-Continental Nigeria Ltd v. Ayantuyi & Ors (1995) NLC-3231990(SC) at pp. 28; Paras D–E.
"I think it is necessary to point out that Nnamani, J.S.C. in his concurring judgment in the same case observed as follows:- 'It is settled that an undertaking to pay damages is the price which the person asking for interlocutory injunction has to pay, and it ought to be required on every interlocutory order... The undertaking to pay damages applies whether the plaintiff has not been guilty of misrepresentation, suppression or other default in obtaining the injunction.'"
EXPLANATION / SCOPE
An undertaking as to damages is required for every interlocutory injunction. It is the price of obtaining the injunction. The rule applies even if the plaintiff acted in good faith. The undertaking protects the defendant if the injunction is later discharged. The principle is settled law. The court must extract the undertaking before granting the injunction. The failure to extract may be cured on appeal. The rule applies to both ex parte and inter partes injunctions. The undertaking is a condition for the injunction. The court may enforce the undertaking.