England and Wales Court of Appeal (Civil Division) Decisions

IN THE SUPREME COURT OF JUDICATURE
IN THE COURT OF APPEAL (CIVIL DIVISION)
APPLICATION FOR PERMISSION TO APPEAL
(His Honour Judge Heppel QC)

		Royal Courts of Justice Strand London, WC2
		13 March 2003

1. LORD JUSTICE CHADWICK: This is an adjourned application for permission to appeal from an interlocutory order made on 9 December 2002 by His Honour Judge Heppel QC, sitting as a Judge of the High Court in the Queen's Bench Division, in proceedings brought by Arbuthnot Fund Managers Ltd to enforce post-termination restraints in a service agreement. The defendant to these proceedings (and the applicant in this court) is Mr Nigel Rawlings. The application has been listed with appeal to follow if permission is granted. We have heard full argument on the application and the appeal.
2. Arbuthnot Fund Managers Ltd is engaged in the provision of fund management and other investment services for private clients, trusts and charities. Until 11 November 2002 Mr Rawlings was employed by Arbuthnot in a senior position; that is to say, as executive director. The restrictions which Arbuthnot seek to enforce against Mr Rawlings are set out in clause 15.1 of a written service agreement dated 23 July 1998. The clause is in these terms:

"15 Obligations after termination

15.1 In order to protect the goodwill confidential information trade secrets and business connections of the Company and the Group and without prejudice to any other duty imposed by law and equity and whether or not the Company shall have been in breach of this agreement whether repudiatory or not Mr Rawlings covenants with the Company that for a period of twelve months ('the Restraint Period') after ceasing to be employed under this agreement he will not on his own behalf or on behalf of any person, firm or company directly or indirectly without the written consent of the Company:

15.1.1 during the Restraint Period solicit or deal with or discourage from dealing with the Company any person firm or company who has at any time during the twelve months period immediately preceding such cessation of this agreement done business with the Company or the Group and whom he had introduced or with whom he had any business dealings or knowledge;

or

15.1.2 during the Restraint Period solicit or deal with or discourage from dealing with the Company any person firm or company or other legal body who was at any time during the six months period immediately preceding such cessation of this agreement a 'prospective client' of the Company and the Group. A prospective client shall mean a person with whom Mr Rawlings or to his knowledge any other employee of the Company had discussions with a view to obtaining investment business;

or

15.1.3 during the Restraint Period endeavour to entice away from the Company any person employed by the Company or the Group immediately preceding such cesser who is in a management position or has dealings with the clients or customers of the Company and the Group;

or

15.1.4 during the Restraint Period directly or indirectly interfere with or attempt to interfere with the business relation subsisting between the Company and the Group and any person firm or company who is a client customer supplier (agent or other intermediary) of or for the Company and the Group and subject thereto this shall not prevent Mr Rawlings from approaching such supplier with a view to securing new business for himself or any other third party."

In that context "the Company" means the claimant, Arbuthnot Fund Managers Ltd; and "the Group" means the Company, any holding company of the Company and any subsidiary of the Company or any such holding company.

3. Mr Rawlings left his employment on 11 November 2002. These proceedings were commenced on 29 November. Application for interim relief by way of injunction was made by notice issued on the same day. That application was supported by the witness statement of Mr Brian Rout - the managing director of the claimant company and a director of its immediate parent, Arbuthnot Latham & Co Ltd. Arbuthnot Latham & Co Ltd is itself a subsidiary of Secure Trust Banking Group Plc. Mr Rout explained in his witness statement that the claimant company's business is very small by the standards prevalent in the financial services industry. As he said: "It cannot compete with the financial resources and distribution capabilities of many of its competitors and wholly relies on the discreet and personal nature of the service it provides, mainly to high net worth individuals." He went on to say this, at paragraph 6 of the witness statement:

"6 The recent depression in international equity markets has contributed to a position where the company is suffering trading losses. Its ability to recover profitability and to support current staffing levels depends on its ability to retain its client base."

4. In his witness statement Mr Rout identified three key interests as essential to the operation of the claimant's business. They were: (1) confidential information, (2) client connections and (3) senior - and what he described as "client-facing" - employees. He explained how the claimant sought to protect those interests. First, by relatively long periods of notice in the employment contracts of senior employees. Second, by seeking to ensure that clients had a relationship with at least two fund managers; so if one were to leave there was an existing relationship with another. Third, by post-termination restrictions of the type which were included in Mr Rawlings' service agreement of 23 July 1998.
5. At paragraphs 25 and 26 of his witness statement Mr Rout described the circumstances in which Mr Rawlings came to be employed by the claimant company. He said this:

"25 Mr Rawlings' employment with the claimant began in September 1994. He was also an executive director of the company. Prior to joining the claimant, he jointly operated and owned an investment business with George Alexander (known as Sandy Alexander), called A & R Equity. Until very recently, Mr Alexander actively worked for the claimant as an investment director, and he remains a director of the company.

26 I understand that Mr Rawlings and Mr Alexander worked very closely together while they worked for A & R Equity. In 1994, they sold their business to Secure Trust Group Plc. They both then became directors and senior fund managers of the claimant, and continued to work closely together."

Mr Rout then went on to describe Mr Rawlings' position within the company in more detail. At paragraphs 29 to 32 of the witness statement he said this:

"29 As senior investment director, Mr Rawlings was responsible for the claimant's fund management process and for leading the front office fund managers. Until his resignation, Mr Rawlings was the most senior fund manager within the claimant. Consequently, his access to client information, client relationships and influence over other fund management employees were of the highest level.

30 In view of his seniority, Mr Rawlings had an extensive client base of his own. In addition, he worked closely with Mr Alexander and therefore had significant connections with Mr Alexander's clients.

31 Mr Rawlings' client base played an important part in the claimant's revenue. Clients which were designated to him as the lead fund manager, accounted for approximately 18% of the claimant's funds under management ('FUM'). In practice, Mr Rawlings would have also dealt with the clients who were nominally Mr Alexander's, and which amounted to a further 24%. This figure includes a client which although nominally assigned to Mr Alexander, was led by Mr Rawlings, and which independently accounted for approximately 18% of the claimant's FUM. All in all, therefore, clients with whom Mr Rawlings had extensive dealings accounted for a total of 42% of the claimant's FUM.

32 Mr Rawlings and Mr Alexander worked as a team in terms of attracting and managing clients. Mr Alexander would concentrate on matters relating to markets and stocks; Mr Rawlings would take the lead on client relationships and have a great influence over clients. Mr Rawlings had longstanding client relationships, many in excess of 20 years standing, which he would have built up while he worked in A & R Equity. However, A & R Equity's business interests were sold to Secure Trust Plc for over £500,000, and a substantial proportion of this consideration was for the benefit of client relationships."

6. Mr Rout made a second witness statement - dated 12 February 2003 - for the purposes of resisting this appeal. He exhibited to that statement (i) the share sale agreement upon the terms of which Mr Alexander and Mr Rawlings sold the whole of the issued share capital in A & R Equity Ltd to Secure Trust Group Plc in September 1994; and (ii) the service agreement into which Mr Rawlings entered on the same day - 5 September 1994. The claimant company was Mr Rawlings' employer under the 1994 service agreement. That agreement contains, at paragraph 15.1, post-termination restraints in terms identical with those in the later agreement of 23 July 1998.
7. At paragraphs 33 to 34 of his first witness statement Mr Rout set out his account of the circumstances leading up to Mr Rawlings' decision to leave the claimant company on 11 November 2002. Much of that is in dispute, and I need not refer to it in detail. In fairness to Mr Rawlings, however, I should read paragraph 64 of the witness statement which he made on 4 December 2002 in response to the application for interim relief. He said:

"I had no wish to resign from the claimant. At the age of almost 50 and having recently remarried, I wanted to carry on in a stable position with the claimant. I enjoyed a very reasonable salary package based on a gross salary of £130,000 plus a range of fringe benefits. It is highly unlikely I would be able to secure alternative employment at the same level of salary and benefits. I simply could no longer tolerate the various ways in which Mr Rout undermined my position to such an extent that my position as a Board director and as an executive became virtually meaningless. Mr Rout simply did what he wanted. He was quite prepared to stray across the boundaries in allocating fund managers to clients, in altering documents drafted by fund managers involved in giving investment advice, not consulting me about an audit report, and deliberately pursuing a policy of eliminating Mr Alexander as an investment director without consulting me albeit at a very late stage when his mind had already been made up. The events which occurred during my holiday absence were simply the last straw, a point which the claimant's solicitors have overlooked in their recent correspondence. They attempt to minimise the importance of these latest events as being trivial without seeing matters against the background of various developments which occurred and have resulted in my resigning."

8. Put shortly, Mr Rawlings contends that the circumstances which led to his resignation constituted a constructive dismissal so that he can say that the claimant company repudiated the service agreement into which he had entered in July 1998. If that case can be made out at a trial then, it is said, the company cannot enforce the post-termination restraints notwithstanding that, by its express terms, clause 15.1 seeks to provide for that very eventuality. Reliance is placed on Rock Refrigeration v Jones [1997] 1 All ER 1, applying the reasoning in General Bill Posting Co Ltd v Atkinson [1909] AC 118. It is unnecessary to decide on this application whether those authorities do provide Mr Rawlings with the defence on which he seeks to rely - but see generally Chitty on Contracts 28 Edn 1999 at paragraph 17-03.
9. It is common ground on this application that the question whether or not Mr Rawlings can establish a constructive dismissal on the facts cannot be resolved without a trial. The question on this application is whether - assuming the 1998 service agreement was not repudiated by the employer - the post-termination restraints are, nevertheless, so obviously unenforceable (because so obviously contrary to the policy of the law in relation to restraints against trade) that interim relief should not be granted.
10. The application for interim relief was heard on 9 December 2002. Mr Rawlings was willing to give certain undertakings until trial or until the end of the 12 month period - that is to say, until 11 November 2002. Those undertakings are set out at paragraph 1 of schedule 3 to the order made on 9 December 2002. They include an undertaking not to endeavour to entice away from the claimant's employment employees in a management position or having dealings with the claimant's clients. That undertaking corresponds to the restraint in clause 15.1.3 of the service agreement. They include, also, an undertaking not to say anything adverse about the claimant which would have the effect of discouraging clients from dealing with the claimant. That undertaking corresponds in part to the restraints in clauses 15.1.1 and 15.1.2. Paragraph 2 of schedule 3 contains a more extensive undertaking not to disclose trade secrets and confidential information.
11. Notwithstanding the undertakings in paragraph 1 of schedule 3 to the order, the judge granted injunctions until trial or further order; but subject to the limitation that those injunctions would not extend beyond the 12-month period. The injunctions required Mr Rawlings not to:

"(1) solicit or deal with or discourage from dealing with the claimant, any person, firm or company who has at any time during the twelve months immediately preceding 12 November 2002 done investment business with the claimant and whom the defendant introduced or with whom he had any business dealings or knowledge;

(2) solicit or deal with or discourage from dealing with the claimant, any person, firm or company or other legal body who was at any time during the six months immediately preceding 12 November 2002 a prospective client of the claimant. A 'prospective client' shall mean a person whom the defendant or to his knowledge any other employee of the claimant had discussions with a view to obtain investment business."

12. It can be seen that injunction (1) imposes a restraint in terms similar to those in clause 15.1.1 of the service agreement of July 1998, but with two modifications. First, the word "investment" has been introduced to qualify the word "business" where that word first appears. Second, the words "or the Group" have been omitted; so that the class to which the restraint extends under the injunction is limited to those who have done investment business with the claimant company itself. Injunction (2) contains a restriction in terms similar to clause 15.1.2 of the service agreement; but with a similar modification to remove a reference to prospective clients of the Group.
13. It was submitted to the judge that both clauses 15.1.1 and 15.1.2 of the service agreement were too wide to be enforceable. In particular, it was said that the restraint under clause 15.1.1 was not limited to dealings with those who had been clients of the Company or the Group. The expression "any person, firm or company who has at any time during the 12 month period done business with the Company or the Group" could include, it was submitted, banks and stock brokers. Indeed, in argument it was suggested it could include the office cleaner or a tradesman who had supplied office equipment to the company. So understood the clause was obviously far too wide. Similar criticisms were made in relation to clause 15.1.2.
14. The judge dealt with those submissions shortly. He said this, at page 9 line 10 to page 10 line 5:

"The defendant submits that this clause [that is clause 15.1.1] would restrain all dealing whether it relates to the claimant's business or not and whether it relates to what the defendant knew about the business or not. However, in my judgment, it is necessary to note the limiting provisions as follows. Firstly, 'whom' he had introduced, or, secondly, had business dealings with, or, thirdly, knowledge of. In my judgment the claimant has a reasonable prospect of succeeding at trial under this clause in the context of the claimant's investment business. The absence of any geographical limitation would not, in my judgment, in the context of investment and finance be fatal. The claimant would, however, in my judgment, be on less strong ground in respect of such business done by the group as opposed to the claimant itself.

So far as clause 15.1.2 is concerned, it is to be noted that there are several limiting factors to this clause. First, "prospective client" is defined and defined in the context of investment business. Secondly, the defendant must have personally dealt with or, thirdly, have personal knowledge of the client. Like arguments and counter arguments are otherwise agreed to apply to clause 15.1.2 as to 15.1.1. "Dealing", in my judgment, is to be read in the context of investment business. This clause is not obviously bad and the claimant would have reasonable prospects of success in terms of protecting its business, but less chance, in my judgment, with regard to protecting the interests of the group."

15. The judge asked himself whether damages would be a sufficient remedy in the event that no restraint was imposed prior to trial and the claimant company was successful at trial. He held that they would not be. He said this, at page 10, lines 21 and 28:

"Are damages a sufficient remedy? In my judgment it is plain that damages would not be a sufficient remedy were the covenants or any of them to be found to be enforceable and the defendant found to be in breach. Loss and the causation thereof can be notoriously difficult areas in this type of case. Moreover, although the defendant is obviously a man of means, his witness statement is wholly silent as to the extent of them or his liabilities."

16. Having reached that point, and with the well known principles in American Cyanamid Co v Ethicon [1975] AC 396 in mind, the judge granted interim relief on the basis that that was what the balance of convenience required. He said this at page 11 of his judgment, lines 1 and 16:

"As to the balance of convenience, this plainly, in my judgment, weighs in favour of granting some interim relief. It is submitted that the defendant, now 50, is old by City standards and that it is in the public interest as well as his that he be allowed to continue in fund management either as an employee or on his own account. On the other hand, the defendant negotiated a generous service contract on the back of his sale to secure investment in the business. It is in the public interest that contracts, of course, should be honoured. The measure of damages would be far easier to quantify if the claimant ended up as the paying and the defendant as the receiving party rather than the other way round. There is no reason to suppose that the claimant would be unable to meet such damages and, in any event, there is a cross-undertaking over trial given by the parent company itself."

17. The judge granted relief in substantially the form sought under clauses 15.1.1 and 15.1.2 of the 1998 service agreement but with the modifications to which I have referred. He held, also, that the claimant company should have the costs of the application before him. His reasons were expressed shortly, at page 16 in the transcript of proceedings after judgment. He said this between lines 31 and 34:

"The claimant shall have its costs of today, in my judgment, in the entire circumstances, being the substantial victor, but the costs will be the subject of a detailed assessment."

18. The judge went on to give directions for an expedited trial; taking the view that this was a matter which ought to be resolved at a trial where contested facts could be determined as soon as possible. He envisaged that such a trial could have taken place on or after 10 March; that, coincidentally, being the date upon which this application came before this court. He gave those directions so that the interim regime - which might have lead to the risk of one side or the other suffering an uncompensatable disadvantage - should be kept to as short a period as possible. His concerns in that respect do not seem to have been matched by any enthusiasm on the part of the parties for getting on with a trial of this litigation. Mr Rawlings has preferred to take his chance on an appeal to this court.
19. Mr Rawlings seeks to appeal from paragraphs 1 and 3 of the order of 9 December 2002, that is to say, from so much of that order as imposes injunctions and directs payment of costs. By his appellant's notice he seeks also to appeal from the order for a speedy trial; but we have heard little about that in the course of argument. It is unusual - to say the least - for a defendant who is under a restraint pending trial to seek to appeal from an order that the trial should be expedited. The purpose of expedition is to enable the grounds upon which the restraint was imposed to be investigated as soon as possible. It might be thought that a defendant, who resisted the imposition of the restraint, would be anxious that there be a speedy investigation of the merits.
20. The first task of the court - faced with the contention that post-termination restraints on an employee's ability to engage in future business activity are not enforceable - is to construe the contract under which those restraints are said to be imposed. That, as it seems to me, is a task which the court ought to carry out on an application for interim relief (if there is one) if it can properly do so. Unless the court is satisfied that there are disputed facts which bear on the construction of the relevant contractual terms, and that those facts cannot be resolved without a trial, the court at the interlocutory stage is as well able to construe the relevant contractual terms as a court will be at a trial. There is no need to put off until trial determination of the question - what do the contractual terms mean? The court can, and should, determine the scope of the restraints which, as a matter of construction, the contractual terms seek to impose.
21. It is not suggested, in the present case, that there are disputed facts which need to be resolved before the task of construction can properly be undertaken. In addressing that task, it is necessary to keep in mind two factors; the first is that the exercise is one of construction; and that, in the construction of a covenant in restraint of trade, the same principles are to be applied as in the construction of any other written term. The principles are conveniently set out in this context in the judgment of Lord Justice Harman in this Court in Home Counties Dairies Ltd v Skilton [1970] 1 WLR 526. At page 533 he pointed out that it is the first principle in construing written documents that the court should consider the circumstances at the time when they were made, and the position of the parties who entered into them. He referred to the observations of Sir Nathaniel Linley MR in Haynes v Doman [1899] 2 Ch 13, 25;

"Agreements in restraint of trade, like other agreements, must be construed with reference to the object sought to be attained by them. In cases such as the one before us, the object is the protection of one of the parties against rivalry in trade. Such agreements cannot be properly be held to apply to cases which, although covered by the words of the agreement, cannot be reasonably supposed ever to have been contemplated by the parties, and which on a rational view of the agreement are excluded from its operation by falling, in truth, outside, and not within, its real scope."

22. That approach is particularly apposite in a case such as the present. The opening words of clause 15.1, which govern the sub-clauses which come after it, are these:

"In order to protect the goodwill confidential information trade secrets and business connections of the company ..... "

Those words direct the reader to construe what comes afterwards with that object in view. Unless compelled by the language to do so, the court should not construe what comes afterwards so as to encompass activities which could never have been thought by the parties as likely to damage the goodwill or business connections which the clause (as a whole) is intended to protect.

23. The second factor which it is necessary to keep in mind is that it is not the function of the court to strive to give to the clause a meaning which enables it to have effect within the constraints of public policy if that is not the meaning which, as a matter of construction, the parties are to be taken to have intended that it should have. As Lord Justice Simon Brown put it in J A Mont (UK) Ltd v Mills [1993] IRLR 172 at paragraph 28 on page 176:

" ..... the court should not too urgently strive to find within restrictive covenants ex facie too wide, implicit limitations such as alone could justify their imposition."

24. The court must steer a course between giving to the clause a meaning which is extravagantly wide; and giving to the clause a meaning which is artificially limited. The task of the court, in construing the contractual term is simply to ask itself: "what did these parties intend by the bargain which they made in the circumstances in which they made it?"
25. Addressing clauses 15.1.1 and 15.1.2 with those considerations in mind - and having regard to the object stated in the opening notes of clause 15.1 - it seems to me that the court should reach the following conclusions. First, the expression "any person firm or company" which appears in both clauses 15.1.1 and 15.1.2 is properly to be understood as meaning a person, firm or company who is an existing or prospective investment client (as the context requires). Those words are not intended to encompass persons with whom the company has or proposes to have business dealings in a capacity other than as an investment client. It is unnecessary - and inappropriate - to give the words a meaning which is wider than that in the context of a clause which is intended to protect the goodwill and business connections of the company.
26. Second, the primary limitation in clause 15.1.1 is on dealing with clients who have, during the 12-month period immediately preceding the resignation, done business with the Company or the Group. But it is plain that the draftsman appreciated that a restraint which prevented Mr Rawlings from dealing with any client who had done business with the company during that preceding 12-month period would be unnecessary in order to achieve the object of protecting the goodwill and business connections of the company. The purpose, plainly, was to define a class of those in relation to whom Mr Rawlings could be taken to have some influence or connection. That is what the further words of limitation in clause 15.1.1 are intended to achieve.
27. Those further words are "and whom he had introduced or with whom he had any business dealings or knowledge". It seems to me that, as a matter of construction, those further words have to be read disjunctively; so that they are to be understood as if they read "and either (1) whom he had introduced or (2) with whom he had any business dealings or knowledge".
28. If the further words of limitation are read in that sense, the question, then, is whether there is any limitation as to the time at which introduction, or the business dealings or knowledge (as the case may be) took place. To my mind, the proper construction of those words is that the parties intended there to be a temporal limitation of 12 months at least in relation to those who fell within the second limb; that is to say, the restraint was intended to cover (1) those who were introduced by Mr Rawlings at any time or (2) those with whom Mr Rawlings had had business dealings within the preceding 12 months. The further words of restriction must be read with the primary limitation. The primary limitation confines the class to those who have done business with the company within the previous twelve months; the further restriction is that (at least in a case in which the client was not introduced by Mr Rawlings) the business was done through him.
29. I turn, then, to clause 15.1.2. Again, the question is whether as a matter of construction some temporal limitation should be applied to the definition of "prospective client". A prospective client is a person with whom Mr Rawlings - or, to his knowledge, any other employee of the company - had discussions with a view to obtaining investment business. In the first limb of the clause the class is defined as those who were prospective clients within the 6-month period immediately preceding the cessation of the agreement. To my mind it is clear that the temporal limitation in the first limb of the clause carries through into the second limb of the clause. A prospective client is a person with whom Mr Rawlings or - to his knowledge, any other employee of the company - had discussions with a view to obtaining business within the period of 6 months immediately preceding cessation of the agreement.
30. The next task for the court is to ask whether - if that is what those clauses mean - it is plain and obvious that they cannot be enforced having regard to the well known limitations on restrictions in restraint of trade. The question at this interlocutory stage is, I emphasise, whether it is plain and obvious that the restraint will fail after examination at a trial. If it is not plain and obvious - because the determination as to what is in the interests of the parties and in the interests of the public must await a trial - then the clauses must at this stage be regarded as having a reasonable prospect of being upheld.
31. Applying that test, it does appear to me plain and obvious that a restraint which seeks to preclude Mr Rawlings from dealing with any person of whom he had any knowledge within 12 months preceding his departure from the company cannot be upheld; so that the restriction in clause 15.1.1 must fail to that extent. Further, it seems to me that a restriction which seeks to restrain Mr Rawlings from dealing with anyone whom he had introduced in the past - but with whom he had not had business dealings within the preceding 12 months - is also so obviously too wide that it, too, must fail.
32. The reason that I take the view that a restriction which seeks to restrain dealings with anyone whom Mr Rowlings had introduced at any time in the past is too wide, is that it is clear from Mr Rout's witness statement that Mr Rawlings is the point of contact with the clients whom he introduced. It is those clients who can be regarded as "his clients". If Mr Rawlings has had no business contact with the client during the preceding 12 months then, as it seems to me, that client has dropped out of the class in respect of whom the claimant needs protection. Mr Rout points out that the claimant company can build up a relationship with a client over a 12-month period. If Mr Rawlings has been excluded from that relationship for the period of 12 months then there is no need to protect the company from his future contact with that client.
33. I take the view, also, that it is plain and obvious that a restraint which seeks to exclude Mr Rawlings from dealing with prospective clients with whom he has not (but with whom, to his knowledge, other employees have) had discussions with a view to obtaining investment business is too wide. The protection required does not extend beyond prospective clients with whom Mr Rawlings had had discussions with a view to obtaining investment business. To seek to restrict the defendant from dealing with people who, to his knowledge, some other employee had had discussions in circumstances in which he was not involved seems to me obviously too wide.
34. For those reasons I would allow the application for permission to appeal; and would allow the appeal to the extent of modifying the injunctions which the judge imposed.
35. The modifications which I propose are these. First, I can see no reason to include within the injunctions the words "discourage from dealing with the claimant". Mr Rawlings has given the undertaking which is set out in paragraph 1 (2) of the third schedule. He has undertaken not to say anything adverse which would have the effect of discouraging a client from dealing with the claimant. It is unnecessary to impose that obligation afresh by an injunction. Second, I would replace the words "any person firm or company" with the words "any client" in paragraph (1) of the injunction. Third, I would remove from paragraph (1) of the injunction the words "whom the defendant introduced"; on the grounds that that is a restraint which is unacceptably wide. Fourth, I would remove the words "or knowledge" from paragraph (1) of the injunction; again on the grounds that a restraint in those terms is unacceptably wide. Fifth, I would include, at the end of paragraph (1) of the injunction, the words "at any time during the 12 months immediately preceding 12 November". That gives effect to what I hold that restraint to mean.
36. It follows that the injunction under paragraph (1) will restrain Mr Rawlings from soliciting or dealing with any client who has at any time during the 12 months immediately preceding 12 November 2002 done investment business with the claimant company and with whom the defendant has had business dealings during that period. Similar modifications should be made to the injunction under paragraph (2). The words "or discourage dealing with the claimant" should be taken out. And the words "or to his knowledge any other employee of the claimant had discussions" should also be omitted.
37. On the basis that the injunction is modified to that extent, the appeal succeeds. The question whether the judge should, or should not, have made the costs order which he did falls away. The costs of the application before the judge must now be considered in the light of the result of the appeal in this court.
38. MR JUSTICE NEWMAN: I agree entirely with my Lord's reasoning and it follows I agree with order he proposes should be made.
Order: Appeal allowed