Mason v Provident Clothing & Supply Co Ltd

Mason v Provident Clothing & Supply Co Ltd [1913] AC 724 

Restrictive covenant not necessary for the reasonable protection of employer’s business

Facts

The appellant was employed as a canvasser by the respondent. A restrictive covenant in the employment contract provided that the appellant could not, within three years of the termination of his employment, be employed by “any person, firm, or company carrying on or engaged in a business the same as or similar to that of the [respondent], or assist any person employed or assisting in any such business, within twenty-five miles of London aforesaid where the company carry on business.”

Issues

The County Court judge had granted an injunction in favour of the respondent to prevent the appellant from breaching this restrictive covenant. This was reversed by the Divisional Court on the basis that the relevant clause in the contract was too vague to be capable of being enforced by injunction. The Court of Appeal reinstated the order of the County Court. On appeal to the House of Lords, the appellant submitted, inter alia, that the agreement between the parties was an unreasonable restraint on trade and, upon any construction the agreement of a radius of twenty-five miles is wider that was reasonably required for the protection of the respondents.

Decision/Outcome

Viscount Haldane L.C. held that the respondents had failed to show that the restriction went no further than was reasonable for the protection of their business. Notably, there was no evidence that a canvasser, such as the appellant, was likely to have come into possession of any special knowledge of the respondent’s business which would be recognised as a trade secret. Accordingly, the respondents had bound the appellant in a manner which might only have been necessary if they were carrying on a business of a different kind.