header-logo header-logo

After the ‘Drain Doctor’—restrictive covenants in franchising

02 September 2022 / Emily Sadler , Louis Iveson
Issue: 7992 / Categories: Features , Commercial
printer mail-detail
Emily Sadler & Louis Iveson explain why franchisors should review their agreements following a recent judgment
  • Post-termination restrictive covenants in franchising agreements may not be as enforceable as once thought.
  • Practitioners acting for franchise clients (both franchisors and franchisees) should consider the impact of this judgment and how it might change the advice given in light of it.

On 30 June 2022 the Court of Appeal laid down its judgment in Dwyer (UK Franchising) Ltd v Fredbar Ltd and Shaun Bartlett [2022] EWCA Civ 889, [2022] All ER (D) 11 (Jul) in which they dismissed Dwyer’s appeal against an earlier High Court decision which ruled that the post-termination restrictive covenants in its franchise agreement were unenforceable.

This ruling is of crucial importance for franchisors using standard form agreements with its franchisees, but particularly so where the franchisee is an inexperienced individual. The judgment has dismissed the widely-held belief that a 12-month restrictive covenant will generally be enforceable upon a franchisee provided that the restricted activities and geographic

If you are not a subscriber, subscribe now to read this content
If you are already a subscriber sign in
...or Register for two weeks' free access to subscriber content

MOVERS & SHAKERS

Gilson Gray—Linda Pope

Gilson Gray—Linda Pope

Partner joins family law team inLondon

Jackson Lees Group—five promotions

Jackson Lees Group—five promotions

Private client division announces five new partners

Taylor Wessing—Max Millington

Taylor Wessing—Max Millington

Banking and finance team welcomes partner in London

NEWS
The landmark Supreme Court’s decision in Johnson v FirstRand Bank Ltd—along with Rukhadze v Recovery Partners—redefine fiduciary duties in commercial fraud. Writing in NLJ this week, Mary Young of Kingsley Napley analyses the implications of the rulings
Barristers Ben Keith of 5 St Andrew’s Hill and Rhys Davies of Temple Garden Chambers use the arrest of Simon Leviev—the so-called Tinder Swindler—to explore the realities of Interpol red notices, in this week's NLJ
Mazur v Charles Russell Speechlys [2025] has upended assumptions about who may conduct litigation, warn Kevin Latham and Fraser Barnstaple of Kings Chambers in this week's NLJ. But is it as catastrophic as first feared?
Lord Sales has been appointed to become the Deputy President of the Supreme Court after Lord Hodge retires at the end of the year
Limited liability partnerships (LLPs) are reportedly in the firing line in Chancellor Rachel Reeves upcoming Autumn budget
back-to-top-scroll