09 March 2021

Case Law - Talking of non-compete clauses…

In Quilter Private Client Advisers Ltd v Falconer and Another the High Court held that three post-termination restrictive covenants, including a non-compete clause, were unenforceable.  Quilter brought a breach of contract claim against Falconer after she left, during her probationary period, to work for a competitor as a self-employed financial adviser. Quilter was granted an interim injunction against Falconer to enforce the restrictions. When the case came to full trial the Court held that the nine-month non-compete clause was wider than necessary to protect Quilter’s legitimate interests.  Falconer had been entitled to give and receive only two weeks’ notice during her probationary period.  The Court held that the length of a notice period would appear to indicate the importance of the employee’s services to the employer.  That being the case, a short notice period would affect the reasonableness of a lengthy restriction. In the Court’s view, the nine-month non-compete clause was unreasonable and therefore unenforceable.

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