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PRECEDENTS
1 To the extent permitted by applicable law, each party agrees that, throughout the Term, it shall not, whether on its own, or with or through
NEWS
Commercial analysis: This case concerned a share sale in which the defendants had made misrepresentations as to the earnings and profitability of a gambling business. The court found that a co-defendant who was not party to the sale and purchase agreement (SPA) was nonetheless liable for fraudulent misrepresentations made by the shareholder in selling the business. The shareholder had the actual, alternatively, the apparent authority of the co-defendant to make the misrepresentations as his agent. A further claim for breach of a non-compete clause in an SPA was dismissed as the relevant clause was unenforceable. The clause was both too long in duration and too broad in scope, and insufficient evidence was submitted to justify it. The court was not prepared to rescue the clause using the 'blue-pencil' test, without having submissions on how it should do so. Written by James Lancaster, managing associate at Trowers & Hamlins LLP.
PRACTICE NOTES
This Practice Note considers non-compete clauses in commercial agreements and the effect of the Competition Act 1998 (Vertical Agreements Block Exemption) Order 2022, SI 2022/516 (the UK VABEO). Non-compete clauses are contractual obligations restricting a party from competing with the business of another. They take a wide range of forms and various terminology is used to describe them; they may also be referred to as exclusivity clauses, exclusivity provisions, non-poaching clauses, non-solicitation clauses, restraint of trade clauses or restrictive covenants. This Practice Note considers the following common forms of non-compete restriction in standard vertical commercial arrangements between entities that are not actual or potential competitors: • non-compete clauses in distribution agreements etc • non-compete clauses in consultancy agreements • exclusive supply obligations • exclusive purchase obligations • minimum spend commitments Agreements that potentially restrict competition are subject to competition law. Introduction to competition law Chapter I of the CA 1998 prohibits agreements between undertakings, decisions by associations of undertakings or concerted practices which have as their object or effect the prevention, restriction or distortion of competition
NEWS
Commercial analysis: Non-compete covenants must, if they are enforceable at all, be no wider than reasonably necessary for the protection of those legitimate business interests which can be demonstrated as required by the covenantee. Although the authorities have revealed a different approach to enforcement of covenants in commercial agreements as opposed to those in service contracts (for which a more stringent approach is required), ultimately, enforceability is a matter of discretion. Where a solicitor had contracted through a service agreement and a shareholders agreement the court did not categorise the transaction but looked at its substance. It did not approach the shareholder agreement-element of a mixed scenario in the same way as pure business sale agreements, for which a less stringent approach applied, and where freely negotiated, reasonable non-compete clauses are generally enforceable. On the facts, the restriction was enforceable in the service agreement but unenforceable in the shareholder agreement. Written by Joseph Dalby SC, barrister at The 36 Group.
NEWS
Corporate Crime analysis: The court confirmed that, while offences must be charged within any applicable time limit for charging, the requirement that the charge must contain ‘such particulars of the conduct constituting the commission of the offence as to make clear what the prosecutor alleges against the defendant’, in Criminal Procedure Rule (CrimPR) 7.3(1)(b), did not require a statement from the prosecutor that the offence had been laid within the relevant time limit if the timing of the offence was not an element specified in the offence. The court confirmed that where the offence is validly laid within time, non-compliance with a requirement in the CrimPRs would not render an otherwise valid set of proceedings irregular, or a nullity. Written by Adam Craggs, partner at RPC.
NEWS
Dispute Resolution analysis: The judgment of the Circuit Commercial Court in Reeds Carpeting Contractors Ltd v Cairns reminds parties of their disclosure obligations, and the options available to them in respect of an opponent’s failure to comply with those same obligations. In considering an application for striking out the defence of defendants whose disclosure failings had already been brought to its attention on various occasions, the court provided helpful clarification on the approach to determining whether an unless order had been breached, as well as guidance on what may constitute a basis for striking out a claim on the basis of non-compliance with disclosure obligations, and what alternative orders, if any, may be fitting. Written by Emily Lodge, associate at Quinn Emanuel Urquhart & Sullivan UK LLP.
PRACTICE NOTES
This Practice Note considers when non-compliance with a pre-action protocol or the Practice Direction Pre-Action Conduct and Protocols may result in a party being sanctioned and what those sanctions might be. For more general guidance on the extent to which costs incurred pre-action may be recoverable, see Practice Note: Pre-action—costs recovery. Compliance with pre-action protocols The Practice Direction Pre-Action Conduct and Protocols (the Practice Direction) sets out the conduct usually expected of parties prior to the issue of proceedings. It includes provisions that will apply in all cases, but is specifically stated to apply if none of the other more specific protocols are relevant to your claim (see Practice Direction Pre-Action Conduct and Protocols, para 2). For further information, see Practice Note: Pre-action behaviour in non-protocol cases—Practice Direction Pre-Action Conduct and Protocols. If your claim falls within one of the dispute specific protocols, you will additionally need to consider carefully the provisions of that specific protocol. For details, see Practice Note: The pre-action protocols and when they apply. The court will take into account non-compliance
PRACTICE NOTES
ARCHIVED: This Practice Note is for historical reference. It considers non-compliance with a pre-action protocol and/or the Practice Direction Pre-Action Conduct and Protocols in force prior to 6 April 2015, including when such non-compliance may result in a party being sanctioned and what those sanctions might be. For guidance on non-compliance with a pre-action protocol and/or the (revised) Practice Direction Pre-Action Conduct and Protocols in force from 6 April 2015, see Practice Note: Non-compliance with pre-action provisions, as well as more generally the Practice Note: Pre-action behaviour in non-protocol cases— Pre-Action Conduct and Protocols. To access the Practice Direction Pre-Action Conduct and Protocols in force prior to 6 April 2015, please click: Where we provide paragraph references in this Practice Note, these are to paragraphs in the Practice Direction in force prior to 6 April 2015, unless stated otherwise. Compliance The court may impose costs sanctions for failure to comply with the relevant pre-action protocol or Practice Direction Pre-Action Conduct and Protocols. The court will consider the proportionality of
PRACTICE NOTES
The Criminal Practice Directions 2023 (CPD), at 1.1.3–1.1.5 states: ‘The Criminal Procedure Rules and the Criminal Practice Directions are the law. They provide a code of current practice that is binding on the courts to which they are directed. Participants must comply with the rules and Practice Direction, and directions made by the court.’ This encapsulates the status of the Criminal Procedure Rules 2025 (CrimPR 2025), SI 2025/909 and CPD and reminds those appearing in the criminal courts of the importance in adhering to the rules and practice directions. The CrimPR impose a duty on the participants in a criminal case to: • prepare and conduct cases in accordance with the overriding objective • comply with the rules, practice directions and the directions made by the court, and • inform the court and all parties at once of any significant failure to comply with a procedural requirement of the rules, any practice direction or any direction of the court. Failures of all parties should be notified, so if one party (P) is aware
PRECEDENTS
[insert address of sender] Our ref: [insert reference] Your ref: [insert reference] [insert address of recipient] Date: [insert date] Dear [insert organisation name] Submission to [insert company name] 1 Thank you for your interest in making a submission to [insert company name]. 2 You will appreciate that we receive a large number of submissions from all sorts of people and organisations. Our business has an active research and development function and, at any given time, we will be involved in numerous research and development projects in a range of different areas. 3 From time to time, there may be a situation where you submit an idea or materials relating to something you have developed or research you have done and, independently, we have developed or researched something similar or we already hold other similar information. In such a situation, we would not want, by agreeing to keep information contained in your submission confidential,
NEWS
The Competition and Markets Authority (CMA) has published the non-confidential version of the infringement decision in Pfizer and Flynn Pharma (phenytoin sodium capsules) (Case 50908) from 21 July 2022 involving unfair pricing of an epilepsy drug.
GLOSSARY
The business of obtaining probate and administration where there is no contention as to the right thereto.