Success story: Prompt legal advice from IWG gets restrictive injunction overturned

Elizabthe Bartle - Employment solicitor

Imagine getting home from work one evening to find a process server on your doorstep, waiting to serve you with an injunction that effectively prevents you from earning a living anytime soon.

Imagine then finding out that the reason the injunction has been issued is that there are allegations that you have stolen confidential information from someone you used to work for.

It is a frightening prospect and yet is exactly the situation a client of ours found themselves in recently when a sale of their business, concluded on a very informal basis, went terribly wrong.

Providing advice and support to the client in his hour of need was Elizabeth Bartle, a partner in our litigation team.

As soon as the client received the injunction, he knew that he needed urgent legal advice.

As Elizabeth explains:

‘As soon as the client received the injunction, he knew that he needed urgent legal advice and that this had to be sought from someone with experience of dealing with restrictive covenants and breaches of confidentiality who understood how the injunctions in this field of law operate.’

‘The order he had been served with was very draconian and effectively prevented him from undertaking any business for the new company with whom he was now working while the claim against him was considered, which could have taken months.  It also obliged him to hand over his computers and mobile phone so that these could be forensically examined by an IT expert to see what he had been up to.’

‘A court hearing had been scheduled to allow him an opportunity to object to the injunction remaining in place and for which we only had a small window of time to prepare.’

To understand what happened next, it is necessary to briefly explain the circumstances leading up to the injunction being obtained.

The facts are complex, but in summary our client had owned a business for nearly 20 years which he had agreed to sell to a competitor, but no business sale agreement was ever entered into. Instead, in order to save money and with a desire to speed up the process, the parties chose to proceed on the basis of an exchange of emails.

We only had a small window of time to prepare.

A draft agreement, that went back and forth between the parties, gave a flavour of the deal that had been struck but this agreement was never finalised and did not flesh out important terms about the parties’ future relationship. It was essentially little more than a heads of terms.

Specifically, while the draft agreement stated  that our client was obliged to stay on for a period of time as a sales consultant to ensure a smooth transition, the parties did not agree how long this arrangement was expected to last, whether our client was free to pursue other opportunities during his consultancy arrangement and most importantly did not include any restrictions preventing him from working for a competitor or taking existing or prospective customers to a new company.

As Elizabeth goes on to say:

‘It was a very messy situation, which made it incredibly difficult to establish whether our client was entitled to do what he had done by electing to move on at a time when he felt his obligations to the new business owners had been fulfilled.’

It was a very messy situation.

‘While it would have been preferable to have a detailed contract in place making the both parties’ position clear, in this case the fact that there was so much uncertainty worked in our favour as we were able to cast doubt on whether the injunction should have been granted in the first place.’

In particular:

  • within 72 hours of being instructed, we were able to persuade the new owners to vary the injunction to enable our client to return to work, albeit with a temporary ban on dealing with former customers;
  • within a few weeks thereafter, we persuaded the court to discharge most of the key elements of the injunction given the uncertainty surrounding the terms on which the deal had been struck, which enabled our client to start doing business with nearly all of his former customers; and
  • within two months of our advice first being sought, we were able to persuade the new owners to submit to a mediation with our client which ultimately saw all issues between them resolved on a mutually acceptable and commercially sensible basis.

It was a fantastic result, with which the client was understandably thrilled. However, as Elizabeth notes:

‘While the eventual outcome was great, the client went through a lot of stress and anxiety which could easily have been avoided if he had ensured that a proper agreement had been in place when he sold his business. Or even if, prior to making the move to the new company, he had sought advice on the problems this might cause and on the steps he could take to pre-empt these and therefore avoid or at least minimise the risk of an injunction being sought.’

‘As an aside, this episode was an extremely stressful period for the new owners who could have equally saved themselves a lot of bother and expense had they ensured a detailed sale agreement was in place.’

If you are involved in a business dispute, why not give Elizabeth a call on 020 7845 7443 or email at to see if she can assist. Elizabeth deals with a wide range of matters, including shareholder and partnership disputes, professional negligence and fraud, corporate and personal insolvency and contentious and non-contentious employment matters.

IWG’s corporate department can also assist if you are considering selling or buying a business and wish to avoid the pitfalls described above. Please contact David Grabiner on 020 7845 7462 or email at