Harcus Sinclair LLP v Harcus Sinclair UK Lte [2019] EWCA Civ 335 (05 March 2019)

Harcus Sinclair LLP v Harcus Sinclair UK Lte [2019] EWCA Civ 335 (05 March 2019)

The Court of Appeal held that the non-compete restriction in the NDA, as interpreted by the judge, was too broad and constituted an unreasonable restraint of trade, being neither reasonably necessary for the protection of YLL's legitimate interests as the discloser of confidential information nor commensurate with the benefit received by HSLLP under the NDA. The NDA was a non-disclosure agreement, not a collaboration agreement, and the restriction could not be justified as a blanket ban on acting for any group of claimants in the emissions litigation. The judge's decision on enforceability could not stand and the matter was determined afresh by the appellate court.

Citation
[2019] EWCA Civ 335
Parties
First Claimant/appellant: Harcus Sinclair LLP; Second Claimant: Harcus Sinclair UK Limited; Defendant/respondent: Your Lawyers Limited; Part 20 Defendant: Damon Parker
Jurisdiction
England and Wales
Judgment Date
05 March 2019
Procedural Posture
Civil Appeal / Court of Appeal Judgment on Appeal From High Court
Outcome
Appeal allowed in part; the broad restriction was held unenforceable as an unreasonable restraint of trade.
Legal Topics
Non Disclosure Agreements, Restraint of Trade, Interpretation of Contracts, Solicitors' Undertakings, Group Litigation
Contract Law Commercial Law Restrictive Covenants Non Disclosure Agreements Restraint of Trade Interpretation of Contracts Solicitors' Undertakings Group Litigation

Case Brief

Summary, issues, holding and outcome

More case intelligence is available

Unlock the full research layer for this judgment.

Full judgment text Downloadable case file Legal principles 3 Authorities cited 16 Party arguments 2
Sign in to unlock

Parties

Harcus Sinclair LLP

First Claimant/appellant

Harcus Sinclair UK Limited

Second Claimant

Your Lawyers Limited

Defendant/respondent

Damon Parker

Part 20 Defendant

Procedural Posture

Civil Appeal / Court of Appeal Judgment on Appeal From High Court

Legal Issues

  1. 1 Proper interpretation of the non-compete clause in the NDA between solicitors' firms
  2. 2 Whether the restriction was unenforceable as an unreasonable restraint of trade
  3. 3 Whether an implied term bound the associated company (HSUK) to the restriction

Ratio Decidendi

The Court of Appeal held that the non-compete restriction in the NDA, as interpreted by the judge, was too broad and constituted an unreasonable restraint of trade, being neither reasonably necessary for the protection of YLL's legitimate interests as the discloser of confidential information nor commensurate with the benefit received by HSLLP under the NDA. The NDA was a non-disclosure agreement, not a collaboration agreement, and the restriction could not be justified as a blanket ban on acting for any group of claimants in the emissions litigation. The judge's decision on enforceability could not stand and the matter was determined afresh by the appellate court.

Court Disposition

Appeal allowed in part; the broad restriction was held unenforceable as an unreasonable restraint of trade.

Orders

  • The injunction against HSLLP is set aside.
  • The non-compete restriction in the NDA is unenforceable as drafted.