Tillman v Egon Zehnder Ltd
Words in an unreasonable restraint of trade can be severed if removing them does not change the overall effect of the restraint.
Facts
Ms Tillman joined Egon Zehnder, an executive search firm, in 2004 and rose to become joint global head of its financial services practice. Her employment contract provided that, for six months after leaving, she would not directly or indirectly engage or be concerned or interested in any business carried on in competition with the firm. When she left in 2017, she proposed to join a competitor, and the firm sought an injunction. Ms Tillman argued that the words or interested in would prevent her even from holding a small shareholding in a competitor, so the whole covenant was too wide and void.
Legal principle
The Supreme Court held that the word interested did extend to shareholdings and made the covenant an unreasonable restraint of trade, but that the words or interested could be severed, so the rest of the covenant was enforceable. Lord Wilson reformulated the test for severance: words can be removed if they can be removed without the need to add to or modify the remaining wording, and if their removal would not generate any major change in the overall effect of the restraint. The court overruled the earlier decision in Attwood v Lamont, which had taken a stricter approach to severance.
Related cases on illegality and restraint of trade
- Archbolds (Freightage) Ltd v S Spanglett Ltd [1961] 1 QB 374
- Esso Petroleum Co Ltd v Harper's Garage (Stourport) Ltd [1968] AC 269
- Fitch v Dewes [1921] 2 AC 158
- Herbert Morris Ltd v Saxelby [1916] 1 AC 688
- Holman v Johnson (1775) 1 Cowp 341
- Les Laboratoires Servier v Apotex Inc [2014] UKSC 55, [2015] AC 430
- Re Mahmoud and Ispahani [1921] 2 KB 716
- Mason v Provident Clothing and Supply Co Ltd [1913] AC 724
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This summary is for study and revision and is not legal advice. Although our case summaries are checked for accuracy, we do not guarantee that they are free from errors or omissions. Always read the full judgment for the court's reasoning.
