Chester 01244 405555

Grosvenor Court
Foregate Street Chester
Cheshire CH1 1HG
DX: 19990 Chester

Shrewsbury 01743 443 043

Lakeside House
Oxon Business Park
Shrewsbury SY3 5HJ
DX: 148563 Shrewsbury 14

Airport City, Manchester 0844 800 8346

Office 129
Manchester Business Park
3000 Aviator Way
Manchester M22 5TG

Send us a message
Our Offices

Court of Appeal overturns decision of High Court

5th August, 2014

We recently reported on the case of Prophet plc v Huggett [2014] EWHC 615 (Ch), in which the High Court considered the intentions of the parties to find that a restrictive covenant was enforceable, despite a drafting error.

The restriction sought to prevent Huggett (“H”) from competing with, or working for a competitor of, Prophet plc (“P”). However, the wording of the restriction instead provided that H would not work for a competitor of P who sold software systems produced by P. P was the only company selling the software products that it had produced. It was clear, therefore, on a literal reading that the covenant offered no protection whatsoever to P.

The High Court used its discretion to rewrite the covenant and insert three words “[produced by] or similar thereto” which gave effect to the intentions of P and thereby offered P the intended protection. The High Court then allowed the injunction against H. H appealed.

The Court of Appeal has overturned the decision and held that although leading to a very undesirable outcome for P, the language of the covenant was unambiguously clear and the High Court erred in inserting the words to give effect to P’s intentions. The covenant was therefore unenforceable to prevent H from working for a competitor of P.

This decision has further emphasised the necessity of instructing specialist employment lawyers to draft enforceable restrictive covenants, which will properly protect legitimate business interests.

For further information and advice in relation to restrictive covenants, please contact Claire Brook on 01244 405575 or send an email to [email protected]

You might also be interested in...

Japanese Knotweed

21st August, 2019

What is Japanese knotweed? Essentially it is a tall fast growing Japanese plant with bamboo like stems and... Read More »

Top law firm boosts Chester team with key appointments

15th August, 2019

Leading legal practice Aaron & Partners has strengthened two of its teams with the recruitment of two new... Read More »

Top Shrewsbury lawyer earns national recognition

15th August, 2019

The High Net Worth Guide – an independent industry guide published by Chambers and Partners, has praised Lynda... Read More »

Contact Us