Planon Ltd v Gilligan [2022] EWCA Civ 642 (10 May 2022)

Planon Ltd v Gilligan [2022] EWCA Civ 642 (10 May 2022)

The Court of Appeal held that the High Court judge erred in his preliminary assessment of the enforceability of the non-compete covenant by not applying the correct legal tests and by focusing excessively on the employee's ability to work rather than the employer's legitimate interests. However, given the passage of time, the short period remaining on the restriction, and the balance of convenience, it was not appropriate to grant an injunction at the appellate stage, even if the covenant was likely enforceable.

Citation
[2022] EWCA Civ 642
Parties
Appellant/claimant: Planon Limited; Respondent/defendant: Gilligan
Jurisdiction
England and Wales
Judgment Date
10 May 2022
Procedural Posture
Appeal (civil) / Court of Appeal Judgment on Appeal From High Court (edwin Johnson J)
Outcome
Appeal allowed in part; no injunction granted to enforce the non-compete covenant; no order for disclosure of current contract/job description at this stage.
Legal Topics
Restrictive Covenants, Non Compete Clauses, Interim Injunctions, Enforceability of Post Termination Restrictions, Restraint of Trade
Employment Law Contract Law Restrictive Covenants Non Compete Clauses Interim Injunctions Enforceability of Post Termination Restrictions Restraint of Trade

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 5 Authorities cited 15 Party arguments 2 Amounts and remedies 3
Sign in to unlock

Parties

Planon Limited

Appellant/claimant

Gilligan

Respondent/defendant

Procedural Posture

Appeal (civil) / Court of Appeal Judgment on Appeal From High Court (edwin Johnson J)

Legal Issues

  1. 1 Whether the non-compete covenant in the employment contract was enforceable as a reasonable restraint of trade
  2. 2 Whether the High Court judge applied the correct legal tests to the enforceability of the non-compete covenant
  3. 3 Whether the balance of convenience and adequacy of damages justified the grant of an interim injunction

Ratio Decidendi

The Court of Appeal held that the High Court judge erred in his preliminary assessment of the enforceability of the non-compete covenant by not applying the correct legal tests and by focusing excessively on the employee's ability to work rather than the employer's legitimate interests. However, given the passage of time, the short period remaining on the restriction, and the balance of convenience, it was not appropriate to grant an injunction at the appellate stage, even if the covenant was likely enforceable.

Court Disposition

Appeal allowed in part; no injunction granted to enforce the non-compete covenant; no order for disclosure of current contract/job description at this stage.

Orders

  • No interim injunction to enforce the non-compete covenant granted.
  • No order requiring respondent to disclose current contract of employment or job description.