The ex-employee of a jewellery shop in Regent Street had become a salaried employee of a rival shop in the same street. Swinfen Eady J noted that his covenant had only been not to be ‘interested’ in a similar business; and the judge added that in that regard the covenant had materially departed from the common form in the then current edition of Palmer’s Company Precedents that the covenantor should not be ‘engaged or concerned or interested’ in a similar business.
Held: Since his remuneration had in no way depended on the profits of the rival shop, the ex-employee was not in breach of his covenant.
A covenant not to become directly or indirectly ‘interested’ in a similar business to that of the covenantee does not prevent the covenantor from becoming a servant at a fixed salary in a similar business.
Swinfen Eady J
 UKLawRpCh 80, (1902) 1 Ch 950
England and Wales
Applied – Smith v Hancock ChD 23-Apr-1894
The defendant sold his grocery business near Stoke-on-Trent to the claimant and agreed not for the following ten years to carry on or be ‘in any wise interested’ in any similar business operating within five miles of it. The defendant’s wife set up . .
Cited – Tillman v Egon Zehnder Ltd SC 3-Jul-2019
The company appealed from rejection of its contention that its former employee should be restrained from employment by a competitor under a clause in her former employment contract. . .
Lists of cited by and citing cases may be incomplete.
Updated: 10 April 2022; Ref: scu.675709