Westbridge Foods Ltd v Radovits

An undertaking given to the court must be construed by reference to its express terms. Contempt for breach requires proof to the criminal standard. The allegations must identify conduct falling within the undertaking, although the required particularity is less exacting than that of a criminal indictment. Where an employee undertakes not to work for a competitor and to act in good faith, deliberately conducting competing business behind the employer’s back may constitute a breach. Multiple admitted or proved breaches may together establish contempt.

Westbridge Foods Limited sought to commit its former employee, Tamas Radovits, for breaches of undertakings given in proceedings concerning his proposed employment by Oakfield Foods Limited. The undertakings prohibited him from soliciting Westbridge’s customers or suppliers, working for a competitor, and required him to act in good faith and observe confidentiality.

The substantive proceedings were later settled. The committal application therefore concerned only whether the alleged conduct breached the undertakings and, if so, whether the breaches amounted to contempt. The central issues included the meaning of competitor, the scope of the good-faith undertaking, the applicable standard and burden of proof, and whether the proved conduct fell within the pleaded allegations.

1. Applicable principles. The claimant bore the burden of proof, and the criminal standard applied. The undertaking had to be sufficiently clear, and an alleged breach had to relate clearly to its terms. The court could not find a breach outside the allegations made in the application, but the necessary particularity was less than that required for a criminal indictment. Supporting evidence for the committal application had to be given by affidavit.
2. Construction and application. Oakfield was a competitor within the undertaking because its business overlapped with Westbridge’s and the defendant was to develop its poultry business. Working for Oakfield behind Westbridge’s back constituted a breach of the good-faith undertaking. The court rejected the suggestion that the undertaking had been drafted to permit the defendant to work for Oakfield, or that only the good-faith provision could restrict that work.
3. Findings. The court found proved, in whole or in part, allegations concerning dealings with Roldrob, Agroliget, THP, S & A Foods, Adros, Oakfield’s customers, expenses, Bomadek, Carnex, Drobex, Perkins, BFI and Hindelang. Some allegations were not proved, including the alleged Konspol transaction and the Poland and Hungary trip as pleaded. The admitted and proved breaches, taken together, established contempt of court.
4. Disposition. The court reserved penalty and costs initially, then imposed a financial penalty of £1,800 and ordered payment within one month. It declined to impose imprisonment. The claimant’s costs were reduced to 75%, with £25,000 payable on account.

The judgment describes earlier procedural steps in the High Court:

• High Court (Commercial Court): the committal application was initially listed before Buckley J, who stood it over to the trial judge. The substantive action later ended after Westbridge accepted £85,000 paid into court.
• High Court (Commercial Court): the present court found that the admitted and proved breaches constituted contempt, imposed a financial penalty, and made costs orders.