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Injunctions for breach of restrictive covenants Sunday, 12th May 2013 Employers understandably regard trade secrets, suppliers, customers, knowhow and their staff as vital, which in turn means that many employers include restrictive covenants in employment contracts. Injunctions. If you decide to ignore a restrictive covenant, or are unaware that one applies to your land and breach it, it can be enforced against you. The most common remedies available to the enforcer of a breach of covenant are compensation or injunctions to prevent you from carrying out the action which is in breach. A restrictive covenant is a provision in a deed imposing some form of restriction on the use of the property that is the subject of that deed. At this time the building was at an advanced stage. The claimant sought an injunction to prevent the defendants trespassing over his property in breach of a restrictive covenant that prohibited building on the plot. Where you are not in breach of contract, then there are a number of remedies available where it is believed that a former employee has breached the restrictive covenants. Where there is a breach of a restrictive covenant, the covenantee may enforce the covenant by injunction. The main remedy for breach or threatened breach of a restrictive covenant is an injunction. The Court however does have the discretion to award damages in addition to or in lieu of an injunction. The primary remedy for breach of a restrictive covenant is a permanent injunction to restrain the breach. Damages or injunction—the test. In most cases you will want to enforce the restrictive covenants and to do this, you would need to seek an injunction. There is always one party who benefits from the restrictive covenant and one party who must observe it. 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. Enforcement of restrictive covenants. However, the courts have jurisdiction to award damages instead of an injunction.. In such cases, it is possible to seek compensation for lost profits as well as or instead of an injunction to prevent further breaches. In the context of a Restrictive Covenant enforcement lawsuit, specific performance takes the form of a permanent injunction rendered by the court in which it orders the defendant-Homeowner to do or cease from doing such acts or omissions that are resulting in such Homeowner’s violation of the applicable Restrictive Covenant. Restrictive covenants can be found against freehold and leasehold properties. The claimant delayed by about two years in seeking an injunction to prevent the defendants from building a house on the plot. This note provides an overview of the remedies available for breach of restrictive covenants including types of injunction in employment cases, when to apply for an injunction and actions against third parties in the employment context. Although the usual remedy for enforcing restrictive covenants is an injunction to prevent further breach, sometimes the damage is already done. If the breach is yet to be committed then an injunction is likely to be awarded. Breach of the implied covenant of good faith … An injunction could be said to “promote” a contractual obligation to an obligation towards the court. The Commercial Court makes clear that the starting point is that restrictive covenants will ordinarily be enforced by injunction, as it did in this case in respect of all trading arrangements in breach of Clause 19. The Court of Appeal subsequently disagreed with the Upper Tribunal and overturned the decision - meaning that Housing Solutions had purchased units which had been built in breach of covenant (and was potentially vulnerable to a separate application for an injunction which might result in those units being demolished). RESTRICTIVE COVENANTS UNDER ILLINOIS LAW Terri L. Mascherin R. Douglas Rees Contributing Editors: ... restraining orders and preliminary injunctions.

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