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Reciprocal undertakings in interim injunctions

28/05/2012

AGL Energy purchased easements by negotiation in order to build and operate a transmission line to its Macarthur wind farm.   The landowners told AGL Energy it should not exercise its access rights because the agreements were invalid.  The invalidity arose because

  1. The documents identified the easement by reference to attached plans, which were not in fact attached and
  2. AGL had failed to engage the processes required by the Victorian compulsory acquisition legislation.

AGL Energy applied for temporary injunctions to prevent the landowners hindering the work, at least until those issues could be finally resolved at trial.

The judge was not in a position to make any final determination as to the merits of the case. The landowners’ arguments had substance and deserved serious consideration.  There was a sensible prospect that they might succeed at trial although that success was by no means certain. 

In the interim, however, the Court preferred a course which carried the lower risk of injustice.   AGL Energy was at greater risk because

  1. The project was already well advanced along its corridor
  2. AGL Energy had already made a substantial investment
  3. Delay would cause significant losses to AGL Energy through contractor EoT claims and lost revenues.

By comparison, the landowners faced less serious risks, namely:

  1. contamination by imported soil,
  2. escape of, and injury to, livestock,
  3. loss of access to a house and to some parts of the property

Most importantly, AGL Energy had undertaken, in the event it was ultimately unsuccessful at trial, to reimburse any loss suffered by the landowners’ in the meantime.  The Court took that into account that into account in weighing the balance of convenience.  There was something manifestly unfair about the landowners not offering an reciprocal undertaking.   AGL ought not be prejudiced because it had brought the dispute to Court, rather than the landowners.   

In that case, the Court granted an interim injunction restraining the landowners from preventing access to their land. 

Read the full text of the Court’s reasons in AGL HP1 Pty Ltd v Alanvale Pty Ltd.

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