High Court injunction secured in conspiracy case
In a rare example of a restrictive covenant case reaching trial, on 25 November 2013, in the High Court found in favour of the Claimant, Croesus Financial Services. Defendants, father and son David and Matthew Bradshaw, were found to have broken restrictive covenants following their departure from their former employer, Croesus, as well as engaging in a conspiracy to divert business before their departure. Success is unusual in cases of conspiracy allegations and the case of Croesus Financial Services Limited v. Mr Matthew Bradshaw and Mr David Bradshaw may have positive implications for UK employers in similar circumstances.
Co-defendant David Bradshaw joined Croesus as an adviser in 2002 and, in anticipation of his retirement entered into an agreement with Croesus whereby he would be provided with a pension in return for allowing Croesus to inherit his client base on his eventual retirement. A few years’ later, he persuaded Croesus to allow him to bring his son Matthew Bradshaw into the business in 2010 to act as his successor. The Bradshaws became concerned about the deal Mr Bradshaw senior had done to allow Croesus to inherit his clients when it became apparent at a meeting in April 2012 that Croesus had put measures in place to ensure that Mr Bradshaw’s client base did not inadvertently transfer to his son following his retirement. Following the meeting, Mr Bradshaw senior hatched a plot with his son to transfer the client base he had agreed would be inherited by Croesus to a new business, Attain Wealth Management Ltd, to which his son would move after the father’s planned retirement in December 2012. He introduced his son to his contacts in Attain and arranged for them to offer him employment with the assurance that he would persuade his clients to transfer while pretending to be too ill to get involved.
David Bradshaw subsequently retired and Matthew Bradshaw resigned out of the blue in December 2012 when, as planned, he joined Attain Wealth Management Limited. He continued to advise Croesus clients with the help of his father. There was no direct evidence of the conspiracy - both Defendants vehemently denied it. However, the Court found, based upon the inferences to be drawn by the surrounding facts and the unreliable witness box testimony of both Defendants that they both had indeed engaged in an unlawful means conspiracy. She further found that both Defendants had breached post termination restrictive covenants in their contracts of employment.