Uzor Holding Limited v Tommy Fordham & Anor

Uzor Holding Limited v Tommy Fordham & Anor

The court held that the post-termination restrictions in clauses 13.2(a)-(d) of Mr Fordham’s service agreement are, in principle, enforceable and reasonably necessary to protect MFL’s legitimate business interests, and that CTRNE is a competitor to MFL. However, the balance of convenience does not favour granting an injunction to enforce the non-compete covenant, given the potential disproportionate harm to CTRNE and the limited evidence of imminent harm to MFL. Injunctions are appropriate in respect of the non-solicitation and non-dealing restrictions relating to customers and employees.

Parties
Claimant/applicant: Uzor Holding Limited; 1st Defendant/respondent: Mr Tommy Fordham; 2nd Defendant: Mallet. Footwear Limited
Jurisdiction
England and Wales
Judgment Date
19 November 2024
Procedural Posture
Derivative Claim (insolvency and Companies List) / Interim Injunction Application
Outcome
Interim injunction granted in part; non-compete injunction refused; non-solicitation and non-dealing injunctions granted.
Legal Topics
Post Termination Restrictive Covenants, Derivative Actions, Injunctions, Restraint of Trade, Confidential Information, Non Compete Clauses
Employment Law Company Law Post Termination Restrictive Covenants Derivative Actions Injunctions Restraint of Trade Confidential Information Non Compete Clauses

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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 (insolvency and Companies List) / Interim Injunction Application

Legal Issues

  1. 1 Are the post-termination restrictions in Mr Fordham’s service agreement enforceable?
  2. 2 Is Mr Fordham in breach or at risk of breaching those restrictions?
  3. 3 Is an interim injunction appropriate to enforce the restrictions?

Ratio Decidendi

The court held that the post-termination restrictions in clauses 13.2(a)-(d) of Mr Fordham’s service agreement are, in principle, enforceable and reasonably necessary to protect MFL’s legitimate business interests, and that CTRNE is a competitor to MFL. However, the balance of convenience does not favour granting an injunction to enforce the non-compete covenant, given the potential disproportionate harm to CTRNE and the limited evidence of imminent harm to MFL. Injunctions are appropriate in respect of the non-solicitation and non-dealing restrictions relating to customers and employees.

Court Disposition

Interim injunction granted in part; non-compete injunction refused; non-solicitation and non-dealing injunctions granted.

Orders

  • Injunction granted restraining Mr Fordham from soliciting or dealing with MFL’s customers and sales agents until 31 October 2024.
  • Injunction granted restraining Mr Fordham from poaching MFL’s employees until 31 October 2024.