However, the High Court felt that the clause as drafted did not give effect to what the parties intended to achieve by it. The Court found that a 'reasonable person' would have understood the parties to have meant this to extend to 'similar' products and effectively added wording into the clause to this effect, upholding the 12 month restriction. H appealed to the Court of Appeal and his appeal was upheld. The Court's view was that when a contractual provision is ambiguous in meaning "with one interpretation leading to apparent absurdity and the other to a commercially sensible solution" the Court is likely to interpret the clause to produce a commercially sensible result. However, that would only be the case where the clause was truly ambiguous in meaning and that was not the case here. The clause wasn't drafted ambiguously, just poorly. The Court found that there was no basis to read wording into the clause to interpret it differently, even though this meant it was of no practical benefit to P at all, and the clause did not therefore prevent H from his proposed activities at his new employer. This case highlights the importance of careful and effective drafting if restrictive covenants are to be enforceable and achieve the protection for employers that they are intended to. With employees becoming more mobile as business confidence returns and employers invest in recruitment, it is important that employers review the level of protection which they have in employment contracts to ensure that it is adequate and that covenants are fit for purpose in the light of changes to the business, the employee's role and the competitive environment.
Illegality defence in discrimination claims
5 August 2014
The Supreme Court has decided on whether an illegal immigrant can bring a claim for discrimination despite the illegal nature of the contract
We are grateful to Daniel Barnett for this report of the Supreme Court decision in Hounga v Allen.
At common law a court will not normally enforce a contract where the basis of its performance results in an unlawful or illegal act - otherwise known as illegality of contract. Miss Hounga, a Nigerian national, arrived in the UK in January 2007 having falsely obtained a visitor’s visa. She had no right to work in the UK and, after July 2007, no right to remain. However, she was employed by Mrs Allen as a live in nanny and lived in the Allen household. Hounga was mistreated by Allen and, in July 2008, Allen evicted Hounga from the household, effectively dismissing her from employment. Hounga succeeded in a claim against Ms Allen for unlawful discrimination in relation to the dismissal which was subsequently upheld by the EAT. However the Court of Appeal upheld an appeal by Allen accepting that the illegality of the contract formed a material part of Hounga's complaint and to uphold it would condone illegality. Hounga appealed. The Supreme Court upheld the appeal as they said there was an insufficiently close connection between Hounga's immigration offences and her claim for discrimination as the former merely provided the setting or context in which that tort was committed.
Withdrawing a tribunal claim
6 August 2014
CIPP Policy News Journal
08/04/2015, Page 114 of 521
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