Customer Systems Plc v Ranson

The applicant in this case had clearly through the passage of time and through his own abilities reached a senior position in the company. But one has to remind oneself throughout, I think, of two points. First, as I read the judgment the judge held in terms that he was not a de facto director; and secondly, his original contract of employment was never varied or altered. What he is accused of having done in this case in the ordinary way would fall comfortably within the kinds of covenants and restrictions one would often expect to see in a case of a contract of employment relating to a senior employee. But there is no such contract as Mr Stafford has stressed. The express obligations under this particular contract of employment can indeed be described as "weak".

Furthermore, as I read the judgment the judge held, perhaps unsurprisingly given the terms of the contract of employment, that Mr Ranson was in a position whilst he was employed lawfully to prepare himself for what he might be doing when he left his employment.

In those circumstances one might perhaps look for some purchase as to the judge's reasoning, and in particular in paragraphs 74 and 77 of his judgment, as to why it was said that Mr Ranson was by his actions in breach of the duty of loyalty arising under the contract and indeed of any fiduciary duties if they arose as the judge seems to have thought. With all respect to the judge, there is relatively little analysis of this point; and to the extent that as part of his reasoning in paragraph 74 he relied upon part of the decision in the case of Helmet Integrated Systems Limited v Tunnard [2006] EWCA Civ 1735, there are clear distinctions between that case and the present case, not least because of the distinctions in the wording of the contract of employment in question.

I have considered the written arguments and also the helpful oral arguments of Mr Stafford. I take the view (and I do of course acknowledge that this was a decision not only of a very experienced judge but also of a judge very experienced in this particular field) but nevertheless I do take the view that all the points raised in the grounds of appeal do merit further argument and have at least realistically arguable prospects of success. Whether they turn out indeed to be correct is another matter altogether; but my view is that the points do deserve the grant of permission to appeal.

I would only add this: that on the third ground of appeal as proposed, relating to the list of customers and subsequent use, Mr Stafford has told me that that no longer arises because the claimants are not pursuing damages in that regard and one can see why they are not, having regard to the way in which the judge expressed himself. But in case there is any confusion on their point I would simply indicate that I would have been prepared to grant permission to appeal on that issue as well.