Value of Restrictive Covenant when Moving for Permanent Injunction
A recent case demonstrates the value of a restrictive covenant. In The Residences at the Bath Club Condominium Association, Inc. v. Bath Club Entertainment, LLC, 48 Fla.L.Weekly D221a (Fla. 3d DCA), the parties entered into a settlement agreement and a proceeding relative to the breach and enforcement of the settlement occurred. The trial court entered an order enforcing the settlement agreement based on a specific paragraph in the agreement. Ultimately, the facts, for purposes of this posting, are not as significant as the appellate court’s discussion in obtaining a permanent injunction when dealing with a restrictive covenant. In particular, when dealing with a restrictive covenant, a party does NOT need to show irreparable harm to obtain a permanent injunction. This alone establishes the value of a restrictive covenant when moving for a permanent injunction to enforce the covenant.
To obtain a permanent injunction, a petitioner must “establish a clear legal right, an inadequate remedy at law and that irreparable harm will arise absent injunctive relief.” …. Further, the trial court did not abuse its discretion by interpreting Paragraph 5 [of the settlement agreement] as containing a restrictive covenant, the violation of which satisfies the irreparable harm element. … Although violation of a restrictive covenant serves to fulfill the irreparable harm element of injunction….
With that in mind, injunctive relief was appropriate without proof of irreparable injury or a showing that a judgment for damages would be inadequate. “The value of a restrictive covenant . . . is often difficult to quantify and may be impossible to replace.” Accordingly, we affirm the imposition of the injunction….
The Residences at the Bath Club Condominium Association, supra (internal citations omitted).
Please contact David Adelstein at [email protected] or (954) 361-4720 if you have questions or would like more information regarding this article. You can follow David Adelstein on Twitter @DavidAdelstein1.