Restrictive Covenants: It's All Down To The Drafting

We become involved in restrictive covenants, more often than not, only after the issue has become contentious. In the majority, these issues could have been avoided had enough thought been given at the beginning of the process. It really does come down to the drafting.

The following Court of Appeal matter Prophet plc v Huggett [2014] EWCA Civ 1013, is a recent cautionary tale regarding the proper drafting of restrictive covenants. Not so much in relation to having a restrictive covenant per se - these were always a given in this scenario - but rather, getting them right in the first instance.

Prophet Plc is a company focused on developing computer software for the fresh produce industry, primarily fruit, vegetables, cut flowers and herbs. Prophet does not deal with fresh fish, meat or any dairy products but rather created and sold an integrated suite of software applications known as Pr3 that covers many of the functions such as accounting, purchase and sales,