Search our news, events & opinions

On 1 September 2016 Withy King LLP merged with Royds LLP. The trading name for the merged firm is Royds Withy King. All content produced prior to this date will remain in the name of the firms pre-merger.

13 June 2014 0 Comments
Posted in Employment, Opinion

12 month non-compete enforceable against financial adviser

Author headshot image Posted by , Partner

In Merlin Financial Consultants Limited v Cooper, the High Court has held that a 12 month non-competition post-termination restrictive covenant in the contract of a financial adviser was enforceable. The financial adviser had been paid for the goodwill in the client base which he brought with him to the firm under a “goodwill agreement” but was prevented from working in any capacity in competition with its employer for 12 months after the termination of his employment.

The Court held that the non-compete restriction was enforceable because the goodwill agreement was akin to a business sale agreement into which the parties had entered with equal bargaining power. He also noted that 12 month post termination restrictions were common in the financial services industry and were reasonable where there was an exceptionally strong relationship between the employee and their clients.

The employee’s argument that the employer had failed to mitigate its loss by not putting him on garden leave or seeking injunctive relief failed. The Court came to the decision that a claim for breach of contract was appropriate in these circumstances where the employer did not wish to cause further damage to the client relationships. The financial adviser was ordered to pay damages for the employer’s loss of profits for a full two years following his departure

Leave a comment

Thank you for choosing to leave a comment. Please keep in mind that comments are moderated and please do not use a spammy keyword or a domain as your name or it will be deleted.





It pays to employ the right employment solicitor

Learn more


T: 020 7842 1439 (DDI)

Search our news, events & opinions