Factual and Procedural Background
The Plaintiff operates a supermarket from premises in The City. In 2023 it negotiated with the Defendant. On 4 April 2024 the parties entered a ten-year licence under which the Defendant would operate a homeware store occupying about half the Plaintiff's premises. A side letter dated 12 August 2024 permitted the Defendant to break the licence after five years. The written agreement included keep-open, signage, stock, security and indemnity provisions and an entire agreement clause. The Defendant opened on 29 September 2024. By email dated 8 December 2025 the Plaintiff informed the Defendant it intended to close the Defendant's store for commercial reasons; subsequent correspondence concerned termination but did not allege repudiation. The Defendant's accounting expert, Attorney Kiernan, reported that the store had been loss-making and projected continuing structural losses through to 2028 (the break date).
The Plaintiff applied for interlocutory injunctive relief on 22 January 2026; an earlier interim order was refused but short service was granted. On 29 January 2026 the Defendant gave an undertaking to comply with the licence and continued to trade. Judgment refusing the interlocutory injunction was delivered by Judge Bolger on 1 May 2026. A costs hearing on 13 May was listed; counsel for the parties were Attorney Fitzpatrick and Attorney Drinan for the Plaintiff and Attorney Jeffers and Attorney Freeman for the Defendant.
Legal Issues Presented
- Whether the Plaintiff raised a fair issue to be tried that the Defendant breached the licence agreement.
- Whether the Plaintiff established a strong case that it is likely to obtain specific performance / a mandatory injunction compelling the Defendant to keep the store open until the break date.
- Whether damages would be an adequate remedy and, relatedly, where the balance of convenience and justice lies pending trial.
- Whether the status quo should be preserved by ordering the Defendant to continue trading pending trial.
Arguments of the Parties
Plaintiff's Arguments
- The Plaintiff contends the Defendant is in breach of the licence and seeks interlocutory mandatory relief to enforce keep-open and related obligations.
- The Plaintiff asserts it has a strong case for specific performance and that damages would be inadequate, in part due to alleged reputational damage and impact on attracting future tenants.
Defendant's Arguments
- The Defendant denies repudiation and says it will rely at trial on the Plaintiff's conduct (signage, security, other tenants) to justify any alleged breaches.
- The Defendant argues damages are an adequate remedy and contends there is no basis for compelling a loss-making business to continue trading against its wishes.
Table of Precedents Cited
| Precedent |
Rule or Principle Cited For |
Application by the Court |
| Merck Sharp & Dohme |
The framework for interlocutory injunctions: consider whether a permanent injunction might be granted at trial, whether there is a fair question to be tried, then balance of convenience/justice with adequacy of damages central. |
The Court applied this framework and concluded the Plaintiff had not satisfied the strong case test for mandatory relief and that damages were an adequate remedy at interlocutory stage. |
| Gary Keville Transport Ltd v MSC (Mediterranean shipping Company) Ltd [2022] IEHC 130 |
Preservation of the status quo as a consideration where other matters are balanced. |
Cited for the status quo principle; the Court considered but did not order preservation of trading as it would be against public interest to compel trading at a loss. |
| Parol Ltd & Caroll Village (Retail) Management Services Ltd v Friends First Pension Funds Ltd & Superquinn [2010] IEHC 498 |
Where a keep-open clause exists, repudiation may be established if the landlord's actions substantially deprive the tenant of the benefit of the lease. |
The Court accepted the legal analysis but found the Defendant's evidence did not establish substantial deprivation at interlocutory stage. |
| Chartered Trust Plc v Davies [1997] 2 EGLR 83 |
Authority cited for the test of substantial deprivation relevant to repudiation. |
Relied on as supporting authority for the substantial deprivation test; the Court found the test not met on present evidence. |
| Moulton Buildings Ltd v Westminster [1975] 30 P&CR 182 |
Authority referenced for the substantial deprivation concept. |
Cited as part of the authorities underpinning the substantial deprivation test; not satisfied on current evidence. |
| Maha Lingam v Health Services Executive [2005] IESC 89 |
Mandatory relief requires a "strong case" standard. |
The Court held the Plaintiff needed to meet the strong case test for mandatory relief and concluded it had not done so. |
| Thomas Thompson Holdings Ltd v Musgrave Group Plc [2016] IEHC 28 |
Distinguishes mandatory and prohibitory orders; mandatory orders require a strong case and examination of substance. |
The Court adopted the approach and found the Plaintiff had not established a strong case for mandatory relief. |
| Co-Operative Insurance Society Ltd v Argyll Stores (Holdings) Ltd [1998] AC 1 |
House of Lords authority expressing the settled practice of not compelling a business to continue trading at a loss; public interest and supervision concerns. |
The Court found Argyll persuasive and applied its reasoning to refuse to compel the Defendant to continue loss-making trading pending trial. |
| Wanze Properties (Ireland) Ltd v Five Star Supermarket & Tesco (Ireland) Ltd [1997] JILL-HC 102401 |
Example of exceptional circumstances where an injunction was allowed (defendant closing not for loss reasons but to expand nearby). |
Cited as an example of an exceptional circumstance; the Court did not find comparable exceptional circumstances here. |
| Betty Martin Financial Services Ltd v EBS DAC [2019] IECA 327 |
Authority on long-standing customer connection/trading identity and the difficulty of quantifying certain reputation-related losses. |
The Plaintiff relied on it for reputational loss; the Court distinguished its earlier decision in Somnus and concluded damages for retail loss are quantifiable. |
| Somnus GMC Waterford Limited & Anor v Flynn & Anor [2025] IEHC 676 |
Distinguished Betty Martin and held damages from retail operation are quantifiable by reference to turnover, outgoings and profits. |
The Court applied the same reasoning and concluded reputational harm here could be quantified and damages would be an adequate remedy. |
| Yoplait Ireland Ltd v Nutricia Ireland Ltd [2025] IECA 210 |
Authority regarding reserving costs to the trial judge in interlocutory matters. |
The Court considered reserving costs but indicated an indicative view that the Defendant should be allowed costs rather than reserving them. |
| McLoughlin & Anor v Fennell & Ors [2024] IEHC 178 |
Illustrates that issues decided at interlocutory stage may not be revisited at trial. |
The Court noted the similarity and the implications for costs and interlocutory decisions not being revisited. |
| Somnus GMC Waterford Limited & Anor v Flynn & Anor [2025] IEHC 60 |
Authority on costs in interlocutory applications (allowing defendant costs). |
The Court indicated it would follow that approach and allow the Defendant their costs, subject to further submissions. |
Court's Reasoning and Analysis
Judge Bolger applied the Merck Sharp & Dohme framework: consider whether a permanent injunction might be granted at trial, whether there is a fair issue to be tried, and then the balance of convenience/justice with adequacy of damages central.
On the fair issue point the Court concluded the Plaintiff had raised a fair question that the Defendant breached the licence. However, on the key question whether the Plaintiff had established a strong case for mandatory relief (specific performance/compulsory continued trading) the Court found the Plaintiff had not satisfied the strong-case threshold required for mandatory interlocutory relief (Maha Lingam; Thomas Thompson).
The Court found the Defendant's evidence about signage, security and other tenants did not, at this interlocutory stage, establish the degree of "substantial deprivation" required to prove repudiation (drawing on Parol and supporting authorities).
The Court treated the House of Lords decision in Argyll as persuasive: there is a settled reluctance to compel a business to continue trading at a loss because of public interest and supervision concerns. The Court found that even if the Plaintiff succeeded at trial, specific performance of the entire licence was unlikely to be ordered and that damages were an adequate remedy for the Plaintiff's commercial losses. The Court accepted its prior reasoning in Somnus that retail losses and any quantifiable reputational effects can be assessed by reference to turnover, outgoings and profits.
The balance of convenience and interests of justice therefore did not favour compelling the Defendant to continue trading; preserving the status quo in the sense of forcing continued trading was not warranted. The Court also considered the Plaintiff's concern about precedent but applied scepticism to that contention and concluded any wider effect could be quantified in damages or fall within the Argyll rule where licensees trade at a loss.
On costs the Court noted the possibility of reserving costs to the trial judge but indicated an indicative view that the Defendant should be allowed their costs; a further hearing on costs was listed with a timetable for written submissions.
Holding and Implications
INTERLOCUTORY INJUNCTION REFUSED
Holding: The Court refused the Plaintiff's application for interlocutory injunctive relief compelling the Defendant to continue to trade and to comply with the keep-open and related obligations at this interlocutory stage.
Implications: The immediate legal effect is that no interlocutory mandatory order was granted; the Plaintiff retains its claims and may pursue them at trial (including claims for specific performance, declaratory relief and damages). The Court held damages to be, on the present material, an adequate remedy and therefore declined interlocutory specific performance. The Court gave an indicative view that the Defendant should recover its costs of the application and listed a further hearing for costs submissions on 13 May. The decision applies existing authorities and does not purport to establish new precedent beyond applying those authorities to the present facts.