Tullett Prebon (Singapore) Ltd and Another v Chua Leong Chuan Simon and Others and Another Suit

• Jurisdiction: Singapore
• Judgment Date: 19 August 2005
• Date: 19 August 2005
• Docket Number: Suits Nos 498 and 515 of 2005
• Court: High Court (Singapore)

Tullett Prebon (Singapore) Ltd and another

Plaintiff

and

Chua Leong Chuan Simon and others and another suit

Defendant

[2005] SGHC 150

Choo Han Teck J

Suits Nos 498 and 515 of 2005 (Summonses in Chambers Nos 3507 and 3608 of 2005)

High Court

Employment Law–Contract of service–Breach–Whether interlocutory injunction should be granted to restrain employee from working for another employer–Injunctions–Purposes for grant–Protection of contractual rights–Whether adequacy of damages sole consideration

The plaintiffs were employers of the defendants. The employment contracts provided the employee with a right to terminate the employment on three months' notice. This right only accrued after the employee had served two years' employment. At various dates, the plaintiffs received letters from the defendants stating that they were resigning. The plaintiffs responded through their solicitors by putting the defendants on notice that although the defendants' conduct amounted to a breach of contract, they did not accept the breach. Subsequently, the plaintiffs commenced two suits against the defendants.

The plaintiffs then applied for interlocutory injunctions against the defendants in the two suits. Both applications were dealt with at the same time as the legal and factual disputes were similar. As the defendants were presently working for the intervener, the latter was formally joined as a party to the proceedings.

The defendants and the intervener opposed the applications on a number of grounds: (a) it was the plaintiffs, not the defendants, who were in breach of (an implied term of) the contract; (b) the law would not compel the performance of an employment contract, whether directly or indirectly; and (c) the balance of convenience laid against the plaintiffs because their loss could be computed by monetary compensation.

Held, allowing the plaintiffs' applications:

(1) Although an employer could not compel a reluctant employee to continue working for him, he was entitled to restrain the employee from working for somebody else. This was on the basis that a legally binding agreement was binding and enforceable because the parties intended it to be so, and they believed, as would any bystander who might be asked, that it would be dishonourable to not do so: at [4].

(2) The trial judge, with a more complete state of the evidence, would be better placed to determine whether an implied term (establishing a requirement of mutual trust and confidence) existed in the contracts in question, and if so, whether the plaintiffs breached that term. Presently, there was insufficient evidence in support of the assertion that there was a constructive dismissal of the defendants: at [5].

(3) The balance of convenience, as well as the difficulties in assessing damages, was roughly the same for all the parties. The defendants should not be permitted to disregard the contract they had signed. The principle of adherence to the contract was the most universal principle. The contractual loss in this case could have a value fixed on it, but honour was priceless: at [7].

(4) This was not a dispute over a restraint of trade clause, but a case about the enforcement of a straightforward term as to when the employee in question should be permitted to tender his resignation. In cases such as the present, where an injunctive relief was still possible, it should be granted unless there were good reasons why it should not. In this instance, there was no good reason in refusing the plaintiffs' application: at [9].

(5) The plaintiffs had a legitimate interest to protect, which was their interest in the contract of employment. Not every breach should be answered with a “damages are adequate” retort. In many commercial contracts, damages would usually be a sufficient remedy, and in many instances, the most appropriate one. It was also a remedy that might be combined with other remedies to refine the orders that a court might make so as to present the fairest possible result. It should not be the default remedy of convenience: at [9].

Cantor Fitzgerald v Wallace [1992] IRLR 215 (refd)

Chiam Heng Hsien v Jurong Town Corp [1985-1986] SLR (R) 92; [1984-1985] SLR 256 (refd)

Esso Petroleum Co Ltd v Harper's Garage (Stourport) Ltd [1968] AC 269 (folld)

Provident Financial Group plc v Hayward [1989] 3 All ER 298 (folld)

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