Hine Solicitors Limited v Kathryn Natasha Jones & Anor

On an application for an interim injunction concerning an employee’s alleged continuing employment, the American Cyanamid test applies. A contractual minimum employment term may be plainly arguable as valid, despite statutory minimum-notice provisions, without the court finally deciding the issue.

Acceptance of a repudiatory breach must be clear, whether communicated expressly or established by an unequivocal act assessed objectively. An employee’s acceptance of clients who independently transfer their work is not, without evidence of prompting or misuse of confidential information, enticement or breach of the implied duty of fidelity.

Where an injunction would impose restrictions wider than those contractually agreed after lawful termination, the applicant must identify a legitimate business interest requiring the additional protection. A broad and uncertain restraint, combined with delay and a strong case that resignation was accepted, may make the balance of convenience adverse to relief.

Hine Solicitors Limited sought an interim injunction against Kathryn Natasha Jones after she resigned on three months’ notice and joined Blaser Mills LLP. Hine contended that a contractual clause required her to remain employed for an initial 36-month term and that her resignation was therefore ineffective or constituted an unaccepted repudiatory breach.

The relief ultimately sought would have prevented Ms Jones from enticing or attempting to entice any Hine client until May 2025. The application raised issues concerning the construction and statutory validity of the minimum-term clause, possible acceptance or waiver of the alleged repudiation, the implied duty of fidelity, adequacy of damages, restraint of trade principles and the balance of convenience.

1. Interim injunction test. The court applied the familiar three-stage American Cyanamid test: serious issue to be tried, inadequacy of damages and balance of convenience. Because the proposed restraint might substantially expire before trial, the court also considered the claimant’s prospects of success as part of the wider balance of convenience, following the approach in Lansing Linde v Kerr.
2. Contract and resignation. Clause 9.1 was plainly arguable as a valid and effective minimum-term provision. Clause 9.5 was properly capable of operating as a damages regime where an employee left during the fixed term in breach of clause 9.1. The court did not finally determine whether the clause was incompatible with the Employment Rights Act 1996.
3. Acceptance of repudiatory breach must be clear. It may be established by an unequivocal overt act inconsistent with the contract’s continued existence, assessed objectively. The evidence concerning the claimant’s conduct before notifying Ms Jones that it disputed her resignation raised a serious issue as to whether the resignation had been accepted or the breach waived.
4. Fidelity and enticement. The implied duty had to remain consistent with the express contract. The evidence that two clients moved their work after Ms Jones’s departure did not establish a serious issue that she had actively enticed or solicited them. Accepting instructions from a client that moved without prompting was not, without more, misuse of confidential information or enticement.
5. Balance of convenience. The proposed order was wider than the contractual restraints and covered clients beyond Ms Jones’s knowledge. Hine identified no legitimate business interest requiring that broader restriction. The definition of client was likely to be unworkable, and delay had altered the status quo while Ms Jones reasonably believed her resignation was accepted. The balance therefore favoured refusal of relief. The application for an interim injunction was dismissed.