First Principles of Business Law

5. Injunctions

5.2. The availability of injunctions

Read the facts and the question and then choose the best answer.

A, a football player, signs a contract with B, the owner of a football club. In exchange for a fee of $500,000 A agrees to play for B for three years. He also agrees not to appear in advertisements during this period for any products not endorsed by B. Some time later B finds out that A has been offered a lot of money by C to appear in an advertisement for a product that B has not endorsed. B fears that A will be tempted to do the advertisement and knows that this would cause him great financial loss for which A could not possibly compensate him. B says he will seek a court order to stop A from doing the advertisement.  Will the court issue an order to prevent A from appearing in C's advertisement?

(a) Yes, because if A were to appear in C's advertisement, it would be a clear breach of A's contract with B and there is no reasonable prospect of B claiming damages from A.

(b) No, because the courts will not issue orders to stop a breach of contract before it happens. If a breach occurrs, the normal remedies, such as damages, will be available to B.