Can Monetary Loss Be Irreparable Loss?

This article will argue for an exception to the seemingly unexceptional principle under Pakistani jurisprudence that "monetary loss can never be considered as an irreparable loss" because money can be quantified and recovered ("Monetary Loss Principle") in respect of granting injunction.

5. For the argument that as it is a monetary matter, therefore, there is no question of irreparable loss being suffered by the respondent; suffice it to say, that this is not the absolute rule... (Mian Saqib Nisar, J in 2008 YLR 2040 at para 5)

If Monetary Loss Principle is considered as an absolute with no exception (as is the majority view of the Pakistani courts), this can do more unjust than just in certain cases (discussed further below).

Injunction requires co-existence of three ingredients[1]: (i) plaintiff to show prima facie case, (ii) whether balance of inconvenience lies in favour of granting injunction, i.e., which party (plaintiff or defendant) will face more inconvenience if injunction is granted, and (iii) whether plaintiff will suffer irreparable loss if the injunction is refused (these three ingredients shall be referred to as the "Injunction Ingredients").

• [1] Injunction requires co-existence of the Injunction Ingredients: PLD 1970 Supreme Court 139, 2004 SCMR 1092 at para 21, 2015 CLC 1121 at para 8, 2015 CLC 1695 at para 8, PLD 2003 Karachi 222 at para 11, 2001 CLC 838 at para 3, 1992 CLC 345 and 1990 MLD 155.

Under Pakistani law, "monetary loss is not considered irreparable" because it can be calculated and recovered later.[2] This principle is based on two pillars: (i) money can be quantified, and (ii) the claimant can always recover it through legal action.

• [2] Monetary loss can never be an irreparable loss: 1984 CLC 422 at para 13, PLD 1995 Lahore 456 at para 9, 1995 MLD 384, 1995 CLC 707 at para 23, 1990 MLD 155 at para 14, 1999 MLD 1876 at para 15, 1997 CLC 683 at para 7.

These two pillars are based on an unstated assumption. That is, in all eventualities, the claimant can afford the legal costs and endure a lengthy court process. Which is not the case for many in the country where 37.8% population is living in poverty (World Bank, 2023).

Consider a factory worker who is denied his salary by his employer. How will he pay his bills, buy food for his family, or survive without income? If his salary is withheld, he could lose his home, and his family may face hunger or worse. In such cases, it seems wrong to say that the worker has not suffered irreparable harm. Surely, judge made laws should not result in starvation.

The inability to pay for basic needs directly impacts his fundamental right to life under Article 9 of the Constitution of the Islamic Republic of Pakistan, 1973 ("Constitution"). The State is also obligated under Article 38 of the Constitution to ensure basic necessities like food, shelter, and clothing, making the denial of salary a serious issue with potential irreparable consequences.

In another scenario, a plaintiff who is unable to obtain a restraining order to prevent the defendant from presenting and encashing a disputed cheque could face criminal prosecution under Section 489F of the Pakistan Penal Code, 1860. The initiation of such a criminal case can severely impact the plaintiff, potentially resulting in reputational harm and even the loss of employment, both of which constitute irreparable loss.

The stigma attached to criminal proceedings is far-reaching and cannot be undone merely through subsequent legal remedies. The Sindh High Court, in 2015 YLR 2674 at para 6, recognized this concern when addressing an injunction in a cheque dispute, acknowledging the significant and irreparable damage that can arise in such circumstances.

The problem stems from Pakistani courts' misconception about the meaning of the word "irreparable loss". While in general sense "irreparable loss" is "the one which cannot be repaired by any means accessible to individual parties".[3] In connection with injunction under law, "irreparable loss" refers to "an injury for which no legal remedy furnishes full compensation or adequate redress, (i) owing to the inherent ineffectiveness of such legal remedy, or (ii) because owing to the delay incident to the prosecution of an action at law to final judgment and obtaining service therein, such judgment and process would prove fruitless of beneficial results."[4]

In law, "irreparable loss" does not mean loss which cannot be repaired. It means a "serious" or "material" injury. (J. G. Woodroffe "The Law Relating to Injunctions in British India" (1906) p. 105)

As per the English jurisprudence (which Pakistani courts have vastly adopted - at times, without judicial thought process), "irreparable loss" means that an injury which is "serious" or "material" and not "adequately reparable by damages". Adequacy of damages means "whether the remedy at law is, under the circumstances of the case, full and complete?".[5] In the Pakistan's Constitution, Article 199 uses the word "adequate remedy". Pakistani courts have devised three factors to determine whether or not a remedy is adequate: (i) nature and extent of the relief, (ii) point of time when that relief will be available, and (iii) conditions on which that relief would be available particularly the conditions relating to the expense and inconvenience involved in obtaining it (PLD 1963 Lahore 575 at para 8 (Full Bench)).

In view whereof, denying injunction to the plaintiff merely on the ground that he has not been able to establish irreparable loss because money is involved should be reconsidered. Instead, the courts may look at the seriousness and materiality of the damage plaintiff can suffer if injunction is not granted. To curb floodgates, court may further factor in financial vulnerability of the plaintiff, the immediacy of the harm, and whether the damage results in broader harm such as reputational damage or criminal liability.

• [3] J. G. Woodroffe "The Law Relating to Injunctions in British India" (1906) p. 105. W. W. Kerr, E. P. Hewitt, S. E. Willian and J. M. Paterson "A Treatise on the Law and Practice of Injunctions" (1903)
• [4] J. G. Woodroffe "The Law Relating to Injunctions in British India" (1906) p. 105.
• [5] J. G. Woodroffe "The Law Relating to Injunctions in British India" (1906) p. 106.

Sections 54 of Specific Relief Act, 1877 ("SRA 1877") and Section 94 (along with Order XXXIX) of Code of Civil Procedure, 1908 ("CPC") are primary provisions dealing with law of injunction. Section 54 of SRA 1877 provides that "Subject to the other provisions contained in, or referred to by, this Chapter, a perpetual injunction may be granted to prevent the breach of an obligation existing in favour of the applicant, whether expressly or by implication". It sets out guidelines and illustrations pursuant to which injunction (temporary and perpetual) may be granted.[6]

• [6] Section 54(b) provides that "where there exists no standard for ascertaining the actual damage caused, or likely to be caused, by the invasion".
• Section 54(e) provides that "where the injunction is necessary to prevent a multiplicity of judicial proceedings".
• Illustration (c) provides that "The directors of a public company are about to pay a dividend out of capital or borrowed money. Any of the shareholders may sue for an injunction to restrain them."

Section 94 of CPC provides that in order to prevent the ends of justice from being defeated the court may: (i) grant a temporary injunction, or (ii) make such other interlocutory orders as may appear to the Court to be just and convenient. Order XXXIX Rules 1 and 2 elaborate upon Section 94 and empowers the court to grant temporary injunction.

Ironically, none of Section 54 SRA 1877, Section 94 CPC or Order XXXIX CPC provide for, indicate towards or envisage for the plaintiff to show a loss which cannot be repaired (irreparable loss) in relation to granting injunction. It is a judge made law.

While the Monetary Loss Principle may be the majority view, there has been voices from Pakistani courts postulating alternative (at times contrary) views:

• Monetary Loss Principle is not absolute principle: PLD 1982 Lahore 49 at para 9 and 2008 YLR 2040 at para 5.
• Stay can be granted even if case does not fall within the four corners of Order XXXIX CPC: 1997 CLC 302 at paras 6 and 7, PLD 1990 Karachi 1 at para 4, PLD 1983 Karachi 303 at para 14, PLD 1978 Lahore 790 at para 5,

Age-old principles of law/equity were developed by men, a fallible creature of nature. With respect, they should not be taken at their face value. James Fitzjames Stephen (a great 19th century legal scholar and judge) critiqued legal maxims:

It seems to me that legal maxims in general are little more than pert headings of chapters. They are rather minims than maxims, for they give not a particularly great but a particularly small amount of information. As often as not, the exceptions and disqualifications to them are more important than the so-called rules. (Sir J. F. Stephen, History of the Criminal Law of England, vol. 2.94)

Sir Stephen said this about the legal maxims. In my view, this is (and should be) true about the judge made laws in Pakistan for many have crept into the Pakistani jurisprudence without proper application of judicial mind and without factoring in peculiar circumstances of Pakistani society and culture, etc.

In light of the above mentioned notions Monetary Loss Principle is a misfit, does not align with the original thought behind the irreparable loss principle, and has deviated significantly. This needs to be revisited.

Courts should develop clear criteria to determine when a monetary loss is so serious or material that it qualifies as irreparable harm, considering factors such as the plaintiff's financial status, the proportionality of the harm, and whether alternative remedies would provide timely redress. But Monetary Loss Principle should not be applied unexceptionably.