Arbuthnot Fund Managers Ltd. v Rawlings

Arbuthnot Fund Managers Ltd. v Rawlings

The post-termination restraints, as drafted, were unreasonably wide in restraining dealings with any person whom the employee had ever introduced or merely had knowledge of, and in restricting dealings with prospective clients with whom only other employees had contact. The injunctions must be modified to limit their scope to clients with whom the employee had business dealings within the relevant period and to exclude restraints based solely on introduction or knowledge. The modified injunctions are reasonable and enforceable at the interlocutory stage.

Parties
Applicant/respondent: Arbuthnot Fund Managers Ltd; Respondent/appellant: Nigel Rawlings
Jurisdiction
England and Wales
Judgment Date
13 March 2003
Procedural Posture
Civil Employment/contract / Appeal From Interlocutory Order (injunction)
Outcome
Appeal allowed; injunctions modified
Legal Topics
Post Termination Restraints, Restrictive Covenants, Injunctions, Constructive Dismissal
Employment Law Contract Law Post Termination Restraints Restrictive Covenants Injunctions Constructive Dismissal

Case Brief

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Parties

Arbuthnot Fund Managers Ltd

Applicant/respondent

Nigel Rawlings

Respondent/appellant

Procedural Posture

Civil Employment/contract / Appeal From Interlocutory Order (injunction)

Legal Issues

  1. 1 Whether the post-termination restraints in the service agreement are enforceable or unreasonably wide and contrary to public policy
  2. 2 Whether interim injunctive relief should be granted pending trial
  3. 3 Whether the scope of the injunctions should be modified to reflect only reasonable protection of the employer's interests

Ratio Decidendi

The post-termination restraints, as drafted, were unreasonably wide in restraining dealings with any person whom the employee had ever introduced or merely had knowledge of, and in restricting dealings with prospective clients with whom only other employees had contact. The injunctions must be modified to limit their scope to clients with whom the employee had business dealings within the relevant period and to exclude restraints based solely on introduction or knowledge. The modified injunctions are reasonable and enforceable at the interlocutory stage.

Court Disposition

Appeal allowed; injunctions modified

Orders

  • Injunctions modified to restrain only solicitation or dealing with clients with whom the defendant had business dealings in the 12 months preceding departure
  • References to 'discourage from dealing', 'introduced', and 'knowledge' removed from injunctions