To uphold restrictions which a covenant imposes upon the freedom of action of the servant after he has left the service of the master, the master must satisfy the Court that the restrictions are no greater than are reasonably necessary for the protection of the master in his business.
Courts should be reluctant to read down a potentially excessively wide covenant to make it enforceable. If severance is sought, the court should ask whether that which is unenforceable ‘part of the main purport and substance’ of the clause in which it appears?
Lord Moulton said: ‘It would in my opinion be pessimi exempli if, when an employer had exacted a covenant deliberately framed in unreasonably wide terms, the Courts were to come to his assistance and, by applying their ingenuity and knowledge of the law, carve out of this void covenant the maximum of what he might validly have required. It must be remembered that the real sanction at the back of these covenants is the terror and expense of litigation, in which the servant is usually at a great disadvantage, in view of the longer purse of his master.’
Lord Moulton
[1913] AC 724
Cited by:
- Cited – Associated Foreign Exchange Ltd v International Foreign Exchange (UK) Ltd and Another ChD 26-May-2010
The claimant sought interim injunctions to enforce a restrictive covenant against solicitation of customers in a former employee’s contract. The employee, a FOREX dealer, had been placed on garden leave for three months and then his contract . .
[2010] EWHC 1178 (Ch), [2010] IRLR 964
These lists may be incomplete.
Updated: 07 December 2020; Ref: scu.416384 br>