Egon Zehnder Ltd v Tillman

Egon Zehnder Ltd (Appellant) v Tillman (Respondent) was an appeal by the company against the decision of the Court of Appeal which had set aside the injunction which had been granted by the High Court. The company had employed Ms Tillman, a business executive, pursuant to a written agreement which contained post-employment restraints. Following the termination of her employment she proposed to become employed by a firm whose business was in competition with that of the company. The company contended that her proposed employment would breach a covenant in the agreement. She answered that the covenant was void at common law because part of it was in unreasonable restraint of trade. The company disputed this and raised three contentions, each of which she also disputed. The Supreme Court considered the issues in turn. First, it considered whether the word "interested" in the non-competition covenant fell outside the doctrine against restraint of trade. The court concluded that it did not. Second, it considered whether the word "interested" in the non-competition covenant could be construed so as not to prohibit Ms Tillman from holding shares in the businesses there specified. The court concluded that it could not. Third, it considered whether the word "interested" should be severed and removed from the remainder of the covenant so as to leave the employee bound by the remainder of it. The court concluded that it should be. The Supreme Court set aside the Court of Appeal's order and over-ruled the decision in Attwood v Lamont. It formally restored the injunction granted by Mann J, subject only to the removal of the words "or interested".