Breach of Non-Solicitation Clauses

Employment Law and Restrictive Covenants: Breach of Non-Solicitation Clauses

On the sale of a business, a buyer will usually require restrictive covenants to limit the ability of the seller to compete with it post-sale. These normally take the form of non-dealing clauses and non-solicitation clauses. Following a recent High Court judgement, Baldwins (Ashby) Limited v Andrew Maidstone, sellers need to ensure that they are fully aware of the risks of breaching non-solicitation clauses even when former clients initiate the contact.

The Remedy of Specific Performance

Specific performance is a discretionary remedy that may be ordered by a court in the context of a contractual dispute. The remedy is used to compel a party to a contract to carry out its obligations under the contract where damages would not be adequate.

Assignment of Trade Marks

Trade mark owners may assign their trade marks to another person in much the same way as they might assign other property.

When May a Company Purchase Its Own Shares

Share Buy-Backs: how may a company purchase its own shares?

The Companies Act 2006 contains detailed provisions setting out the procedure for a company to purchase its own shares. It is important for directors and shareholders to know that the procedure is available. There can be tax reasons that justify a company buying shares back from a shareholder, although tax advice from an accountant or appropriately qualified tax adviser should first be taken before initiating a share buy-back.

Removing Company Directors under the Companies Act 2006

It is common for a company director to have an executive service contract in place with the company. Such a contract will deal with the director's terms of service, including remuneration and benefits. The contract may also give the term of the director's appointment. However, a director may be removed from office before the end of his term of appointment by an ordinary resolution of the shareholders. The procedure is dealt with by sections 168 and 169 of the Companies Act 2006 and can be used notwithstanding any agreement made between that director and the company.

Contract (Rights of Third Parties) Act 1999: The Basics

Contract law is based upon the fundamental common law doctrine of privity of contract. Privity of contract provides that a contract cannot confer rights or impose obligations upon any person except the parties to that contract. The Contract (Rights of Third Parties) act 1999 provides an important exception to this rule. The Act may give rights to a third party where the purpose of a contract was to grant them such rights. As such, a third party who is not party to a contract may then enforce the contract on his own terms. There are two situations where this applies.

Contract Law: What is Novation?

In simple terms Novation means replacing a party to a contract with a new party. It is a concept that originated in Roman Law and refers to the process by which two contracting parties agree, by consent, to replace one of them with a third party. It provides a means by which parties can work around the doctrine of privity of contract whereby only the original parties to a contract are bound by and are able to exercise the rights created by that contract. The process of Novation actually changes the parties to a contract such that there is effectively a new contract between those parties on the same terms.

Affirmation of a Contract

When one party to a contract commits a breach that is serious enough for the other party to bring a contract to an end, the contract becomes voidable. The contract is still valid but, at that point; the party suffering the breach may elect to rescinded or affirm the contract. In practice, it can be difficult for innocent parties to spot when a contract might be voidable and their right to rescind can easily be lost unitentionally if care is not taken.

Contract Implied Terms: An Overview

Although commercial agreements are usually expressed in writing, it remains the case in English law that a physical contractual document is not required. Where a physical document does exist, the contract may contain terms that are not explicitly included - implied terms. However, such terms cannot simply be implied at will to rearrange a written contract after it has commenced; implied terms must meet certain criteria.

Minority Shareholder Remedies - Share Purchase Orders

When minority shareholders in a private company are unfairly prejudiced, the remedy granted most often is a share purchase order. Common grievances leading to this type of order include a minority shareholder being excluded from management of the business, disputes over the sharing of profits and exclusions from meetings.

Alternative Payment Structures in Business Sales

Buyers and sellers of businesses have a number of alternatives to consider when deciding how to structure payment of the purchase price. The simplest payment alternative may often be a straightforward cash payment. But there are reasons, including tax reasons, for the parties to a business sale transaction to consider other payment structures.

Partnership Law - The duty of good faith between Partners

The duty of good faith is often considered the most fundamental principle underlying a partnership. If you are a member of a partnership or considering joining a firm of partners, it would be a prudent step to familiarise yourself with the basic principle.

Changes Proposed to the Criminal Injuries Compensation Scheme (CICS)

CICS, administered by the Criminal Injuries Compensation Authority, exists to compensate blameless victims of violent crime. The scheme originally set up in 1964 is free and can currently make awards from £1,000 to £500,000. However, budget cuts mean savings have to be made and reform has been proposed. The government estimates that approximately 20,000 awards valued at nearly £75m have been made to criminals over the last ten years; one major source of cost that has been targeted.

Sales of Shares and Businesses: Disclosure Letters and Warranties

When a buyer agrees to purchase a company from a seller the terms of that deal are captured in a contract often prepared by the buyer's solicitor. Within that contract two things operate to help define the allocation of risk of claims between buyer and seller after the purchase is completed. The first of these is warranties, which we have talked about in more detail elsewhere. The second is the Disclosure Letter.

Limited Liability Partnerships: An Overview

Since its introduction under the Limited Liability Partnership Act 2000, the Limited Liability Partnership (LLP) has become an increasingly popular legal structure. Its ability to combine limited liability with the tax status and flexibility of a partnership has contributed to its rising prominence as a corporate vehicle. Although originally devised to provide professional partnerships with greater liability protection, it is not limited to this and is often used elsewhere, equity joint ventures for example.

Purpose of Warranties in the context of Acquisitions

The law offers little protection to the buyers of a private business in the absence of fraud or misrepresentation. Most business people are familiar with the concept of caveat emptor, or 'buyer beware' in more modern parlance. However, difficulties arise in the purchase of businesses as going concerns where it may not be possible to identify all problems or potential issues impacting upon the value of the business. It is up to the buyer of a business to ensure that he has taken steps to protect himself as far as possible through contractual negotiation with the seller and in particular obtaining contractual warranties. Contractual warranties are central to the buyer's risk-management process in the sale and purchase of a business.

Dangerous Dog Bites Double Over Decade

A recent case in which a six-year-old girl had part of her ear bitten off by a dog in Essex has once again highlighted this growing problem. Police have charged the man with allowing the dog to be dangerously out of control in a public place and causing injury under the Dangerous Dogs Act 1991. Although the victim suffered additional damage to her neck and shoulder she survived the attack. Following such a horrific attack, what sort of recourse might the injured party have against a dog owner to compensate them for their injuries?

Recession Increases Cyclist Deaths

The rise of austerity, environmental concerns and healthy living has seeing increased numbers of people resorting to their bicycles for daily transport. The immediate implications appear positive but accident statistics should make cyclists heed a note of caution.

Speed Cameras Reduce Accidents

Despite their unpopularity with many motorists, evidence shows that speed cameras have been effective in reducing accidents. Although cameras are often highlighted more for the revenues they produce than the accidents they prevent, figures show that the number of people killed or seriously injured on roads where they have been installed has fallen by up to two thirds in some places. Anyone who has worked with crash victims can only welcome such a trend.

Surveillance and Your Claim

Social networking, an increase in CCTV presence on the street and the ease of mobile phone video recording should be kept in mind by Claimants while they pursue their claim for personal injury compensation.

Costs and Part 36 Offers

Early settlement and negotiation is encouraged under the Civil Procedure Rules by providing mechanisms for offers to be made and properly considered.