Symbian Limited v Juha Christen Christensen

A garden-leave provision suspending an employee from work does not terminate the employment contract. A contractual restriction applying during the term of the contract may therefore continue to operate throughout the notice period, even where the contract also contains narrower post-termination restraints.

The court may regulate the form and extent of injunctive enforcement of a valid restriction so that it protects a legitimate interest without imposing an unreasonable restraint of trade. The court’s discretion is not confined by a separate, narrower covenant. An appellate court will not interfere merely because it might have exercised that discretion differently.

Symbian sought to restrain its former executive, Juha Christen Christensen, from working for Microsoft during the six-month notice period required by his employment contract. The contract contained a general prohibition on other employment during its term, a garden-leave power, confidentiality obligations and narrower six-month post-termination non-compete restrictions.

The Vice-Chancellor granted an injunction restraining Mr Christensen from employment by or providing services to Microsoft until 16 September 2000. Permission to appeal was refused below. The Court of Appeal considered whether the general contractual restriction remained operative during garden leave, whether it was affected by the doctrine of restraint of trade, and whether the Vice-Chancellor had properly exercised his discretion in formulating the injunction.

1. Appeal dismissed with costs. Permission to appeal to the House of Lords was refused. The injunction restraining Mr Christensen from employment by or advising Microsoft until 16 September 2000 remained in force.
2. The contract distinguished between the notice period, any period of suspension under clause 12.3, and the six-month post-termination restrictions in clause 15.4. Those periods and their subject matter were not co-extensive. Clause 4.3 prohibited any other employment during the term of the agreement, whereas clause 15.4.6 concerned only competing employment after the employment had ceased.
3. Clause 4.3 therefore remained operative during garden leave. The court could not, by construction, insert detailed qualifications or modifications which the parties had not expressed and which were unnecessary for the contract’s commercial efficacy.
4. The doctrine of restraint of trade could apply to restraints imposed during the subsistence of a contract, as recognised in Esso Petroleum v Harpers Garage [1968] AC 269 and Instone v Schroeder [1974] 1 WLR 1308. But clause 4.3 was justifiable when made and was not invalidated merely because the garden-leave power was later exercised.
5. Following Provident Group v Hayward [1989] ICR 160, JA Mont UK Ltd v Mills [1993] IRLR 190 and William Hill v Tucker [1999] ICR 291, the court could modify the extent of enforcement of a valid contractual embargo to avoid an unreasonable restraint. The Vice-Chancellor was entitled to enforce clause 4.3 beyond the narrower terms of clause 15.4.6 because the injunction protected Symbian’s genuine and legitimate interests.
6. The Vice-Chancellor had considered the relevant matters, including the contractual provisions, restraint of trade, Symbian’s protectable interests, and the undertakings and safeguards offered by Mr Christensen and Microsoft. The fact that the Court of Appeal might have reached a different discretionary conclusion provided no ground for interference.
7. The question whether garden leave terminated the implied duty of fidelity was left undecided because it was unnecessary to the appeal and had not been argued by Symbian.

• Court of Appeal (Civil Division): The appeal from the Vice-Chancellor’s order of 12 May 2000 was dismissed with costs. The injunction remained in force.
• Chancery Division: The Vice-Chancellor granted an injunction restraining employment by or provision of services to Microsoft until 16 September 2000. The judgment appealed was not given a citation in the supplied text.