Time to review your company’s business protection provisions?15 February 2012
Mrs Justice Cox, in Towry EJ Limited v Barry Bennett and others, has provided a useful reminder of the value of “non-dealing” covenants over “non-solicitation” covenants (or indeed the two working in tandem).
Mrs Justice Cox has held that to prove “solicitation” in restrictive covenant litigation, the burden is on the employer to adduce evidence of actual “persuasion” or “encouragement”. It was not sufficient to merely show a movement of clients from the ex-employer to the new employer and to ask the court to infer that a solicitation had occurred. Had Towry EJ Limited included “non-dealing” covenants, liability would not have been in issue. Indeed the presence of a “non-dealing” covenant may have been sufficient deterrent for the departing employees not to take on the relevant clients.
For a no obligation chat regarding a review of your existing provisions please call us on 0203 178 5360.