Uzor Holding Ltd v Fordham & Anor [2024] EWHC 966 (Ch) (25 April 2024)

Uzor Holding Ltd v Fordham & Anor [2024] EWHC 966 (Ch) (25 April 2024)

There is a serious issue to be tried as to the enforceability of the post-termination restrictions in Mr Fordham's service agreement. The restrictions, particularly the non-compete and non-solicitation clauses, are in principle reasonably necessary to protect MFL's legitimate business interests in confidential information and trade connections. The 12-month duration is not unreasonable in the circumstances. There is a real risk of breach by Mr Fordham, and damages would not be an adequate remedy. The balance of convenience favours granting the interim injunction.

Citation
[2024] EWHC 966 (Ch)
Parties
Claimant/applicant: Uzor Holding Limited; 1st Defendant/respondent: Mr Tommy Fordham; 2nd Defendant: Mallet. Footwear Limited
Jurisdiction
England and Wales
Judgment Date
25 April 2024
Procedural Posture
Derivative Claim / Interim Injunction Application in Ongoing Proceedings
Outcome
Interim injunction granted in part
Legal Topics
Post Termination Restrictive Covenants, Derivative Actions, Restraint of Trade, Interim Injunctions, Enforceability of Non Compete Clauses
Employment Law Company Law Injunctions Post Termination Restrictive Covenants Derivative Actions Restraint of Trade Interim Injunctions Enforceability of Non Compete Clauses

Case Brief

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Parties

Uzor Holding Limited

Claimant/applicant

Mr Tommy Fordham

1st Defendant/respondent

Mallet. Footwear Limited

2nd Defendant

Procedural Posture

Derivative Claim / Interim Injunction Application in Ongoing Proceedings

Legal Issues

  1. 1 Are the post-termination restrictions in Mr Fordham's service agreement enforceable?
  2. 2 Is there a serious issue to be tried regarding breach of those restrictions?
  3. 3 Is an interim injunction appropriate to restrain Mr Fordham from breaching the restrictions?

Ratio Decidendi

There is a serious issue to be tried as to the enforceability of the post-termination restrictions in Mr Fordham's service agreement. The restrictions, particularly the non-compete and non-solicitation clauses, are in principle reasonably necessary to protect MFL's legitimate business interests in confidential information and trade connections. The 12-month duration is not unreasonable in the circumstances. There is a real risk of breach by Mr Fordham, and damages would not be an adequate remedy. The balance of convenience favours granting the interim injunction.

Court Disposition

Interim injunction granted in part

Orders

  • Mr Fordham is restrained until 31 October 2024 from being engaged or concerned in any business competing with MFL in breach of the non-compete clause, subject to severance of unenforceable wording.
  • Mr Fordham is restrained from soliciting or dealing with MFL's customers and key employees as defined in the service agreement for 12 months from termination.