Proactive Group Holdings Inc & Anor v HJ 2024 Limited & Ors
[2024] EWHC 2821 (KB)
Hine Solicitors Limited v Kathryn Natasha Jones & Anor
6 July 2023
[2023] EWHC 1708 (KB)
High Court
A solicitor sued a former employee for trying to steal clients. The judge said there wasn't enough proof the employee did anything wrong, and the rules the solicitor wanted to use were too strict and unfair.
Key Facts
- •Hine Solicitors Limited (HSL) sought an interim injunction against Kathryn Jones, a former employee.
- •Ms. Jones resigned from HSL after providing three months' notice.
- •HSL disputed the validity of Ms. Jones' resignation, claiming her contract required a three-year minimum term before notice could be given (Clause 9.1).
- •Ms. Jones argued that Clause 9.5 of her contract allowed her to leave during the fixed term, and that her resignation had been accepted by HSL.
- •The injunction sought to prevent Ms. Jones from enticing away HSL clients until May 2025.
- •HSL also relied on the implied duty of fidelity to support their claim.
Legal Principles
American Cyanamid test for interim injunctions: (1) serious issue to be tried; (2) damages are inadequate; (3) balance of convenience favours granting the injunction.
American Cyanamid
When a trial cannot be held before the injunction period expires, the court considers the plaintiff's prospects of success.
Lansing Linde v Kerr [1991] 1 WLR 251, CA
Employment Rights Act 1996 (ERA) s.86 and s.203: clauses limiting statutory minimum notice periods are void.
Employment Rights Act 1996
Acceptance of a repudiatory breach of contract must be clear and unequivocal; an objective test is applied.
State Trading Corp of India v M Golodertz Ltd [1989] 2 Lloyd’s Rep. 277; Enfield London BC v Sivandan [2004] EWHC 672 (QB)
Implied duty of fidelity in employment contracts: not to compete, act honestly, and preserve confidentiality.
Restraint of trade principles may be relevant to the court's discretion in granting injunctive relief, even in subsisting employment contracts.
Red Bull Technology v Fallows [2021] EWHC 9502
In cases of alleged employee solicitation of business, damages are seldom an adequate remedy.
Adorn Spa Ltd v Amijad [2017] EWHC 1313 (QB); Sunrise Brokers LLP v Rodgers [2014] EWCA Civ 1373
Outcomes
Application for interim injunction dismissed.
The court found no serious issue to be tried regarding breach of the implied duty of fidelity due to insufficient evidence of 'enticement' by Ms. Jones. The court also considered the injunction to be contrary to public policy due to its broader scope than contractually agreed restraints and the lack of justification for the broader restriction beyond lawful termination.