Mr Sendall and some of his family members worked in the family recycling business and sold out to an Australian firm. Upon transfer of ownership, Mr Sendall was asked to sign a new contract, which included non-solicitation and non-competition restrictive covenants. Prior to the change of owner, Mr Sendall had no written contract or restrictive covenant terms, although he had written particulars of employment. He eventually signed his contract.

When his relatives set up a rival business (which the new owners alleged he was intimately involved in setting up with them) and Mr Sendall sought to join them, the new owners sought an injunction and relied on the terms of the restrictive covenant. Mr Sendall said it was unenforceable because he received no consideration at the time the new contract was issued. 

This case is a complex one of claim and counter-claim which looks at fiduciary duties, trust and confidence, restrictive covenants and more. It is worth a read if you use restrictive covenants. The High Court judge concluded that the restrictive covenants were excessive but had to fail in any case because the employee was not offered consideration at the time of the variation of terms. Nor was he threatened with dismissal if he did not sign.

In relation to his contractual obligations in relation to trust and confidence, the Court awarded £50+ in damages to Re-Use Collections Ltd. Mr Sendall had been "... directly and intimately involved in setting up the competing business established by May Glass, and was in breach of his duty of fidelity and good faith as a result." Indeed, the firm colluded with him and they, too, were liable for damages. 

The firm was less successful in relation to fiduciary duties - although Mr Sendall had previously been a director of the business whilst still under family control, he had never been a director of Reuse and there was no express provision for or reference to any fiduciary duty in the new contract. The court concluded:

"... there was no express contractual provision which is consistent with his owing fiduciary duties; his role was not similar to the sort of role which a board director might exercise; his role did not give him any responsibility other than in relation to the Dagenham depot, and even then it was relatively low level responsibility; although he undoubtedly held a position of some trust and responsibility as manager of Dagenham, nonetheless he was subject to close control by head office, and was not simply left to get on with things by himself; and he did not have access to confidential financial or other information."
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