Eville & Jones (Group) Ltd v Dr Jason Aldiss
| Jurisdiction | England & Wales |
| Judge | David Pittaway |
| Judgment Date | 11 February 2022 |
| Neutral Citation | [2022] EWHC 269 (QB) |
| Docket Number | Case No: QB-2021-000926 |
| Court | Queen's Bench Division |
[2022] EWHC 269 (QB)
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
Royal Courts of Justice
Strand, London, WC2A 2LL
David Pittaway QC
(Sitting as a Deputy High Court Judge)
Case No: QB-2021-000926
Daniel Tatton Brown QC (instructed by Humphries Kerstetter) or the Claimants
Christopher Stone (instructed by John Howe & Co) for the First Defendant
Hearing date: 10 November 2021
Approved Judgment
I direct that pursuant to CPR PD 39A para 6.1 no official shorthand note shall be taken of this Judgment and that copies of this version as handed down may be treated as authentic.
David Pittaway QC
David Pittaway QC:
In this case, I am asked to enter summary judgment under CPR Part 24 (2) against the First Defendant (“Dr Aldiss”) on the grounds that there is no reasonable prospect of success in defending the claim and there is no other compelling reason why the case should be disposed of at trial. The application is limited to those matters set out in paragraphs 64 – 67 of the Amended Particulars of Claim (“APOC”) insofar as they relate to liability. The Second Claimants do not seek summary judgment in respect of the unlawful means conspiracy claim at paragraph 67A.
The claim form was issued on 12 March 2021. An application was made by the claimants for interim relief which came before HHJ Bird (sitting as a Judge of the High Court) on 22 March 2021. The court made various orders mainly against Dr Aldiss who gave further undertakings. Dr Aldiss had previously given contractual undertakings on 30 October 2020. The Claimants agreed to discontinue their claims against the Second and Third Defendants in July 2021, with no order as to costs. The Fourth Defendant (“Vetline”) entered a creditors' voluntary liquidation in August 2021.
The background to this claim is Dr Aldiss was until his summary dismissal on 17 August 2022 employed by the Second Claimant as Joint Managing Director and was responsible for the day to day running of the business. The First Claimant is the holding company for the Second Claimant. For convenience I propose to refer to them as the Claimants. The Claimants business provides veterinary services for export certification and inspection services for public and private sector customers throughout the UK. Dr Aldiss signed a shareholders' agreement on 31 October 2018 which contains a variety of restrictive covenants. He ceased being a shareholder on 30 October 2020. Those covenants accordingly expire on 29 April 2022.
The case against Dr Aldiss is that he has acted in breach of a number of the restrictive covenants and that he has misused confidential information in breach of an equitable duty of confidence. The Claimants allege that following his summary dismissal, Dr Aldiss committed numerous breaches of the Shareholders' Agreement, by competing with their business, soliciting their clients and poaching their staff, and that he breached the equitable duty of confidence through misuse of their confidential information and entered into an unlawful means conspiracy with the Fourth Defendant. The alleged breaches are fully detailed in the skeleton arguments before me.
The covenants in the Shareholders' Agreement relied upon are to be found at clause 11. I have set out the relevant parts below.
“11.1 ……not, either solely or jointly with or through any other person, on their own account or as agent, manager, adviser or consultant for any other person or otherwise howsoever, directly or indirectly:
11.1.1 for so long as he is a registered holder of any Shares, carry on or be engaged, concerned or interested in, or assist, a business which competes, directly or indirectly, with a business of the Group as operated at any time during the previous 12 months in a territory in which the Group has operated such business during such previous 12 months;
11.1.2 during the Restricted Period, carry on or be engaged, concerned or interested in, or assist, a business which competes, directly or indirectly, with a business of the Group as operated at any time during the Relevant Period In a territory in which the Group has operated such business during such Relevant Period;
… 11.1.4 during the Restricted Period, solicit or accept custom or business from any person in respect of goods and/or services competitive with those manufactured and/or supplied by the Group at any time during the Relevant Period, such person having been a customer of the Group in respect of such goods and/or services during such Relevant Period;
… 11.1.8 during the Restricted Period, induce, solicit or endeavour to entice to leave the service or employment of the Group, or employ, any person who, during the Relevant Period for that Shareholder, was an employee of the Group occupying a senior, managerial, technical, sales or research position or was a consultant to the Group or carried out duties for and on behalf of the Group and who (in any such case) is in possession of Confidential Information or able to influence the client, customer, supplier or other relationships or connections of the Group…”
Application for summary judgment
Before I turn to my consideration of the grounds for this application, I should set out the test required for summary judgment in CPR 24.2, which states:
“The court may give summary judgment against a claimant or defendant on the whole of a claim or on a particular issue if –
(a) it considers that –
(i) that claimant has no real prospect of succeeding on the claim or issue; or
(ii) that defendant has no real prospect of successfully defending the claim or issue; and
(b) there is no other compelling reason why the case or issue should be disposed of at a trial.”
The test to be applied as to whether a party has any real prospect of successfully defending a claim is set out by Lewison J in Easyair Ltd v Opal Telecom Ltd [2009] EWHC 399 (Ch) at [15]. As noted in the White Book (para. 24.2.4) the Court of Appeal set out a shortened version of those principles in Global Asset Capital Inc v Aabar Block Sarl [2017] EWCA Civ 37, [2017] 4 W.L.R. 16 at [27]:
“(1) The court must consider whether the case of the respondent to the application has a realistic as opposed to fanciful prospect of success – in this context, a realistic claim is one that carries some degree of conviction and is more than “merely arguable”.
(2) The court must not conduct a “mini-trial” and should avoid being drawn into an attempt to resolve conflicts of fact which are normally resolved by the trial process.
(3) If the application gives rise to a short point of law or construction then, if the court is satisfied that it has before it all the evidence necessary for the proper determination of the question and that the parties have had an adequate opportunity to address it in argument, it should “grasp the nettle and decide it”.”
Mr Tatton Brown QC has referred me to the judgment of Leggatt J in Gestmin SGPS S.A v Credit Suisse (UK) Ltd [2013] EWHC 3560 (Comm) [15]–[22], where he concluded at [22]:
“…the best approach for a judge to adopt in the trial of a commercial case is, in my view, to place little if any reliance at all on witnesses' recollections of what was said in meetings and conversations, and to base factual findings on inferences drawn from the documentary evidence and known or probable facts.”
Taken from Easyair Ltd v Opal Telecom Ltd, Mr Stone summarised the authorities in his skeleton argument as follows:
i) the court must consider whether the claimant has a “realistic” as opposed to a “fanciful” prospect of success: Swain v Hillman [2001] 2 All ER 91;
ii) a “realistic” claim is one that carries some degree of conviction. This means a claim that is more than merely arguable: ED & F Man Liquid Products v Patel [2003] EWCA Civ 472 at [8],
iii) in reaching its conclusion the court must not conduct a “mini-trial”: Swain v Hillman;
iv) This does not mean that the court must take at face value and without analysis everything that a claimant says in his statements before the court. In some cases it may be clear that there is no real substance in factual assertions made, particularly if contradicted by contemporaneous documents: ED & F Man Liquid Products v Patel at [10];
v) However, in reaching its conclusion the court must take into account not only the evidence actually placed before it on the application for summary judgment, but also the evidence that can reasonably be expected to be available at trial: Royal Brompton Hospital NHS Trust v Hammond (No 5) [2001] EWCA Civ 550.
Mr Stone added:
vi) Although a case may turn out at trial not to be really complicated, it does not follow that it should be decided without the fuller investigation into the facts at trial than is possible or permissible on summary judgment. Thus the court should hesitate about making a final decision without a trial, even where there is no obvious conflict of fact at the time of the application, where reasonable grounds exist for believing that a fuller investigation into the facts of the case would add to or alter the evidence available to a trial judge and so affect the outcome of the case: Doncaster Pharmaceuticals Group Ltd v Bolton Pharmaceutical Co 100 Ltd [2007] FSR 63.
vii) The Supreme Court has recently emphasised that the factual assertions of the respondent should be rejected as being demonstrably unsupportable by contemporaneous documents only in “clear cases”: Okpabi...
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