In Back Office Ltd v Percival, the High Court considered the case of ex-employees who had breached undertakings given to the court as part of the enforcement of a post-termination restrictive covenant not to solicit business from 279 named clients of their former employer. The Court was asked to consider whether the company they now worked for, or its directors, was vicariously liable for the individuals' actions.
‘Solicitation’ has been defined by the courts as ‘specific and direct’ appeals to potential customers. Such approaches had been made in this case so the remaining issue was whether the individuals concerned solicited ‘in the course of their employment’. If so, the company that employed them would be liable regardless of whether it had authorised the approaches or indeed expressly forbidden them.
The directors of the company could only be liable for contempt of court if, in addition, they had either authorised the approaches or could reasonably have foreseen what their employees would do and failed to take all reasonable steps to prevent it. The directors in this case were not personally liable.
Point to note –
- What if the new employer had not been a company but instead an individual proprietor of a business? The same test would apply to him/her as to the company directors. They would only be liable if they authorised the approaches or ought reasonably to have done something to prevent them.