An explanation of interim injunctions in sports litigation
Published 08 June 2017 By: Daniel Burgess
Injunctions are a mandatory order requiring a party to act or, most often, refrain from acting in a particular way. They provide arguably the most useful remedy in sports litigation. When sought on an urgent interim basis (pending trial) they can determine, most fundamentally, the issue of which players and teams are entitled to compete while the lengthy trial process takes it course. They can also, in certain circumstances, provide sport litigators with access to the “nuclear weapons” of civil litigation in the form of search and freezing orders.
Interim injunctions may arise in the sporting field, firstly, as part of an ordinary civil claim. A recent example of an invasive injunction in the sporting field was the search order granted in 2014 to Cardiff City FC and executed at the home of the club’s former head of recruitment, Iain Moody, in support of a claim arising from transfers made at the Club while Malky Mackay was manager, which resulted in the much-publicised scandal concerning racist text messages.
Secondly, interim injunctions may arise as part of a civil claim challenging the decision of a sports governing body, most commonly in breach of contract (where a contract exists between the body and the relevant individual or entity) but also by way of an interim declaration in a claim premised on Bradley principles (following the decision in Newport v FAW). It should be noted that the remedy is equally open to the governing body. In Welsh Rugby Union Ltd v Cardiff Blues, for example, the WRU obtained an injunction preventing the Region from hindering its players from attending training with the national team.
Thirdly, interim injunctions are available as a remedy granted in a sports arbitration, either by the panel itself pursuant to its own rules, or by a court, pursuant to Section 44 of the Arbitration Act 1996. This jurisdiction has some complexities and is discussed in more detail below.
THE AMERICAN CYANAMID TEST IN THE SPORTS CONTEXT
First, the applicant must have an arguable case on the merits. This is, ordinarily, a low threshold. However, in sports disputes, an interim injunction often has the effect of finally determining the dispute (where an injunction is sought to allow an athlete to compete in a particular competition for example). In such cases, the court will impose a higher threshold and, doing its best on the necessarily limited and untested evidence available at the interim stage, consider the likelihood of the applicant ultimately succeeding at trial.
For example, in Dwain Chambers v British Olympic Association, (in which Lord Pannick and Adam Lewis QC of Chambers appeared) the sprinter, Dwain Chambers, sought an injunction to restrain a particular bye-law of the British Olympic Association which made him ineligible for Olympic selection on the grounds that he had previously been found guilty of doping. The basis for the claim was that the bye-law constituted an unlawful restraint of trade. Given the trial of the claim would only take place after the 2008 Beijing Olympics the interim injunction would finally determine the claim. The Court found that it was not satisfied to “a high degree or assurance” that the claim would be successful at trial and refused the injunction (see also Hilton v National Ice Skating Association of the United Kingdom Ltd).
Second, the applicant must show that damages would be an inadequate remedy for the applicant if the injunction is refused and an adequate remedy for the respondent if the injunction is wrongly granted. In the sporting context, damages may often be particularly difficult to quantify. The loss to an individual sportsperson from not being permitted to compete in a particular event as a result of a doping charge, for example, and the ramifications of that in a short lived athletic career can be difficult, if not impossible, to determine.
In Jones v WRU, the Court granted an injunction suspending a 4-week ban for stamping until trial of a claim brought on the basis that there had been procedural defects in the disciplinary process. In a judgment upheld, on this element, by the Court of Appeal, Ebsworth J considered the issue of damages as follows:
“There is…an air of unreality about a Court sitting down to decide whether a player would have made a difference between his team winning or losing a particular match or whether or not he would have been selected for a particular game. It would also be difficult, if not impossible, for a Court to calculate the cause of any demotion of the club if there were a suspension and whether and, if so, what loss flowed from that.”
The possibility of an award of damages is an important consideration for the applicant for a different reason, namely that a pre-requisite to interim relief is a cross-undertaking by the applicant to pay damages flowing from losses incurred by the respondent as a result of the injunction if it is ultimately found to have been wrongly ordered. Thus, when assessing the application, the court will consider whether the applicant would have the means to satisfy such an order for damages and, for this purpose, the applicant will be required to provide evidence of means.
Thirdly, the applicant must show that the balance of justice favours the granting of the application. In considering this issue in the sport context, a number of factors will commonly be in play:
- The interests of third parties. In cases of suspensions from competition, the court will consider the impact on other competitors who will be prejudiced by having to compete against a team or individual that turns out ultimately to have been rightly suspended. In Dwain Chambers, for example, the court considered the fact that an order allowing the athlete to be available for selection would likely prevent another athlete from being selected (see also Phoenix v FIA and FOM).
- Whether the injunction is to maintain a pre-existing right or grant a new one. The inclination of the courts to maintain the status quo militates in favour of injunctions where the decision under challenge is the removal of a right previously enjoyed by a party and against those where the challenge concerns the acquisition of a new right. In Tyrrell Racing Organisation v RAC Motor Sports Association and the FIA, 20 July 1984 Hirst J granted an injunction permitting an existing team to continue to compete pending a challenge to its suspension. Conversely, in Phoenix (in which Adam Lewis QC of Chambers appeared), Morrit VC found that, given Phoenix had not previously competed in a Formula One event, it required a “strong case on the merits” to justify being granted the right to do so on an interim basis (para 71).
- The type of injunction sought. Consistently with injunctions more generally, the court or tribunal is more likely to grant an injunction framed in negative terms (preventing the body from taking action) rather than positive terms (requiring the body to take an action).
INTERIM INJUNCTIONS IN SUPPORT OF SPORTS ARBITRATION
Pursuant to Sections 44(1) and (2) of the Arbitration Act 1996, “unless otherwise agreed by the parties”, parties to a sports arbitration are entitled to apply to the civil courts for injunctions and other orders in support of those proceedings. The range of injunctions available under s.44(2)(e) is wide, and includes freezing injunctions and search orders (see Cruz City 1 Mauritius Holdings v Unitech Ltd).
The question of whether a sports tribunal constitutes an arbitration for which relief under s.44 is available is an issue to be determined in light of the nature of the tribunal in question. In England and Wales Cricket Board Limited v Kaneria (in which Ian Mill QC and Nick De Marco appeared for the ECB) the Court had to consider whether the appeal proceedings established by the Disciplinary Regulations of the English Cricket Board was an arbitration and thus subject to the Arbitration Act 1996, notwithstanding that it was not referred to as such in the rules. The Court held that, given the nature of the proceedings (which were, in substance, akin to a formal arbitral process), they did constitute an arbitration for the purposes of the Act and thus the ECB was entitled, pursuant to s.43, to a witness summons to compel its main witness, the cricketer Mervyn Westfield, to attend the appeal hearing and give evidence.
The power under Section 44 is intended to support rather than replace the powers of the arbitral tribunal. Most sports tribunals have their own power to grant interim remedies and parties are required to seek relief from the tribunal before being entitled to seek relief from the courts. This is reflected in Section 44(5) of the Act which states that the power under s.44(1) exists only if the arbitral panel concerned does not have the power to make the injunction or “is unable for the time being to act effectively”.
Most often, this condition arises where the arbitral panel has not yet been constituted, but it can also arise where the panel, on the facts of the given case, are not able to act quickly or effectively enough. In the former case, where an injunction is sought prior to an Arbitral panel being constituted, Section 44(3) imposes a further hurdle. Specifically, an injunction may be granted before the commencement of an arbitration where the matter is urgent and only to the extent that such an order is “necessary for the purpose of preserving evidence or assets” (Section 44(3)). Following the decision in Cetelem SA v Roust Holdings Ltd., “assets” for this purpose includes intangible assets such as contractual rights. Thus, in cases involving an alleged breach of the rules of the sports governing body, where those rules constitute a contract between the individual or team and the body, an urgent injunction from the Courts would, prima facie, still be available.
In non-urgent cases, the Court may only act on the application of a party to the arbitral proceedings who has obtained the permission of the tribunal or the agreement in writing of all the other parties (Section 44(4)). As Section 44 relief is not available against third parties (being parties not subject to the arbitration agreement) (Cruz City 1 at  to ), it is difficult to conceive of a situation where a respondent to an application would consent to it being determined by a Court (with its far greater powers of enforcement and sanction).
A significant limitation on the utility of Section 44 in the sport context is that certain sports, most notably football, include in their rules a provision expressly excluding the applicability of Section 44 (which constitutes an agreement to oust the jurisdiction pursuant to Section 44(1)). Thus, parties to an arbitration under the rules of those bodies may only bring interim remedies as far as they are permitted under those rules.
In most cases, the powers of the Arbitral tribunal itself will be sufficient. For example an arbitration pursuant to Rule K of The Rules of The FA, is permitted to grant interim relief pursuant to Rule K8 and, before a Tribunal has been constituted, interim relief can be sought by the appointment of an Interim Tribunal under Rule K8(c). One significant limitation to the power, however is that the application for interim relief, even before an Interim Tribunal, must be made on notice to the other party. There is thus no scope for pre-emptive relief in the form of search orders or freezing orders made without notice. In instances of fraud or corruption, which are unfortunately becoming increasingly prevalent in football litigation, this inability to take ex parte pre-emptive measures is a significant limitation on the efficacy of the arbitral panel.
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- Tags: Athletics | Cricket | Dispute Resolution | England | England and Wales Cricket Board (ECB) | Football | Rugby | The FA Rules and Regulations | The Football Association (The FA) | Wales
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The focus of Daniel’s practice is commercial litigation, civil fraud, arbitration and banking and financial services. He has been instructed as sole counsel in the Court of Appeal, all divisions of the High Court and in ICC arbitral proceedings. He is also frequently instructed as part of multi-counsel teams in large-scale commercial disputes.