The employers were a well known roofing and tiling firm, Marley Tiles . The employer sought to impose post employment restrictions including a restriction on canvassing soliciting or dealing with customers in the whole of Devon and Cornwall. Within that area the plaintiffs had 2,500 customers. The covenant against soliciting was also a covenant against dealing.
Held: Given the nature of the business of the employer and of the products, as to which the defendant was restricted by a covenant which was a covenant against dealing as well as against canvassing and soliciting, the case demonstrated that every case must be dealt with on its facts.
Denning MR regarded the defendant as a ‘small’ man in a small way of business in South West Cornwall and regarded the case as a David and Goliath situation. He said: ‘In these circumstances, it seems to me that it would be quite wrong to restrain Mr. Johnson from having any dealings with any of the 2500 customers in this large area. It goes beyond all bounds. Mr. Johnson cannot possibly have known of or come into contact with more than a small percentage of them. Even if it were 15 or 16%, most of those would be in south west Cornwall. Mr. Johnson would be restrained from dealing for a whole year with those 2500.
Taking the size of the area, the number of customers, the class of products – because Marley have many lines other than roofing and tiling – it seems to me that the covenant is too wide to be reasonable.’
Eveleigh LJ said: ‘In so far as that is concerned – and, bearing in mind the hour I will not say what I had intended to say on these subjects – suffice it to say that I regard the two clauses relied upon, 10(a) and 10(c), as too wide; and I will deal with it again, in view of the hour, compendiously by saying that it in effect prevents the defendant from dealing as a manager of a timber yard or a builder’s merchant with products which might be used for purposes far removed from that of roofing – for example, aluminium nails, which are a substantial part of the business, and timber ranging from 25mm by 50mm downwards. Thus it would be – to advert only to 10(c) – that, if a greengrocer’s shop had been re-roofed by the plaintiff, the defendant, in the management of a small ‘do-it-yourself’ shop, could no sell 25mm by 50mm timber to be used for vegetable and fruit racks in the greengrocer’s shop. It seems to me that is much too wide, and for the reasons stated by my Lord I would allow this appeal.’
Templeman LJ said: ‘In the absence of any evidence that the defendant had a substantial influence over this massive 2500 customers, I agree that on the present evidence there is no justification for protecting the plaintiffs against the competition of the defendant, particularly having regard to the fact that the consequences will simply be to condemn him to unemployment for 12 months.’
Denning MR and Eveleigh and Templeman LLJ
[1980] ICR 72
England and Wales
Citing:
Approved – Smith v Hayle Town Council CA 1978
In a case on the issue of sufficiency of qualifying service for bringing an ordinary case of unfair dismissal, the court considered the allocation of the burden of proof in employment cases.
Held: The burden is upon he who is seeking to rely . .
Cited by:
Cited – Ross v Eddie Stobart Ltd (Unfair Dismissal : Automatically Unfair Reasons) EAT 8-Aug-2013
EAT UNFAIR DISMISSAL – Automatically unfair reasons
Burden of proving the ‘whistleblowing’ reason for dismissal under s.103A Employment Rights Act 1996 lies on the employee who has insufficient continuous . .
Lists of cited by and citing cases may be incomplete.
Employment
Leading Case
Updated: 31 October 2021; Ref: scu.514388