The employer in Prophet plc v Huggett sold specialist computer software for use in the fresh produce industry. The employee was Prophet's most senior sales manager. When he moved to a competitor his employer tried to enforce a post-termination restriction in his contract which purported to prevent him from competing with, or working for a competitor of, Prophet either during or for 12 months after leaving employment. The restrictive covenant ended by stating:
"Provided that this restriction shall only operate to prevent the Employee from being so engaged, employed, concerned or interested in any area and in connection with any products in, or on, which he/she was involved whilst employed hereunder."
Read literally, the highlighted words made the covenant worthless, because the competitor would never be selling software systems produced by Prophet. What the covenant was meant to do was to cover products similar to the ones the employee had been involved with. But the High Court was prepared to correct the drafting error by adding the words "or similar thereto" and went on to uphold the full 12 month restriction.
The High Court's decision appeared at the time to be a generous one and it is no great surprise that it has now been reversed by the Court of Appeal. The typical approach is that words can be struck out to save a restrictive covenant but a covenant cannot be re-written. As the Court of Appeal pointed out, nothing had gone wrong with the drafting. It was unambiguous and reflected what the draftsman intended – it was just that the draftsman did not think through the effect of the clause as drafted. It could not be changed, even though it is likely to have little or no commercial effect and leaves the employer with a toothless restrictive covenant.