High court rules on noncompete, nonsolicitation clauses in business sale

November 03, 2013 0 COMMENTS

By Isabelle East-Richard

A recent Supreme Court of Canada decision arising out of Québec will have broad ramifications across Canada.

In Payette v. Guay Inc. (2013 SCC 45 (September 12, 2013)), the Supreme Court of Canada settled the debate over whether the employment contract provisions of the Civil Code of Québec also apply to noncompete and nonsolicitation clauses set forth in business sale agreements. In so doing, it addressed the distinction between the rules that apply to restrictive covenants found in an employment contract and those found in a contract for the sale of a business. read more…

The irony of irreparable harm

February 10, 2013 0 COMMENTS

By Bruce Grist

Conventional wisdom suggests that because a nonsolicitation clause is more likely than a noncompete clause to be enforced by a Canadian court, why bother including a noncompete clause in an employment agreement? The British Columbia Court of Appeal’s decision in Edward Jones v. Voldeng suggests that there is still value in including a noncompete clause. Why? It may be easier to demonstrate irreparable harm, one of the requirements to obtain an injunction, when a former employee has breached a noncompete clause. read more…

Post-contractual duty to act faithfully: a protection limited to a (too) reasonable period

October 21, 2012 0 COMMENTS

by Isabelle East-Richard

Throughout Canada, whether under article 2088 of the Civil Code of Québec in Quebec or the common law elsewhere, employees have a duty to act faithfully and honestly toward their employer once the employment relationship has ended. That is the case even when there is no noncompetition clause in an employment contract.

Although some have thought that this duty to act faithfully and honestly may give employers protection against competition from their former employees, that protection may be limited. Indeed, in 9129-3845 Québec inc., the Quebec Court of Appeal recently said that it was reasonable for such a duty to last only three months following the termination of employment.

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Competing for Talent with Your Own Clients

December 06, 2010 0 COMMENTS

By Joel Henderson and Stephen Acker

Julie is an IT consultant working for NoProblemo! Tech Solutions (NP), a technology consultancy. Julie has worked at NP for six years, is well-educated, and has important certifications and transportable skills. What can NP do to reduce the risk of her being hired away by a client?

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