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215:. His employment contract stipulated (clause 9) not to solicit customers of the company if he were to leave employment of Gilford Motor Co. Mr. Horne was fired, thereafter he set up his own business and undercut Gilford Motor Co's prices. He received legal advice saying that he was probably acting in breach of contract. So he set up a company, JM Horne & Co Ltd, in which his wife and a friend called Mr Howard were the sole shareholders and directors. They took over Horne’s business and continued it. Mr. Horne sent out fliers saying,
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held that the covenant Mr Horne would not compete was broken. ‘I cannot help feeling quite convinced that at any rate one of the reasons for the creation of that company was the fear of Mr Horne that he might commit breaches of the covenant in carrying on the business…’ But because the covenant was
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I am quite satisfied that this company was formed as a device, a stratagem, in order to mask the effect carrying on of a business of Mr EB Horne. The purpose of it was to enable him, under what is a cloak or sham, to engage in business which, on consideration of the
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The company had no such agreement with
Gilford Motor about not competing, however Gilford Motor brought an action alleging that the company was used as an instrument of fraud to conceal Mr Horne's illegitimate actions.
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granted an injunction, so that Horne was forced to stop competing through the company.
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Spares and service for all models of
Gilford vehicles. 170 Hornsey Lane,
223:, N. 6. Opposite Crouch End Lane... No connection with any other firm.
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Mr EB Horne was formerly a managing director of the
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53:. Unsourced material may be challenged and
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117:Learn how and when to remove this message
440:Woolfson v Strathclyde Regional Council
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152:Court of Appeal of England and Wales
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538:VTB Capital plc v Nutritek Int Corp
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