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A topical and practical case study looking at how to use clauses in an LLP/Partnership Agreement to besteffect when partners leave the firm (and, if necessary, how one might re-draft such clauses). The areas wewill explore include:

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If the firm is ill, will these clauses kill or cure it?

SSPPEEAAKKEERRSS

JJeerreemmyy CCaallllmmaann || JJoonnaatthhaann GGaavvaagghhaann || NNaaoommii WWiinnssttoonn || JJaammeess EEggaann

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66..0000ppmm Registration and refreshments

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SSPPEEAAKKEERRSS PPRROOFFIILLEESS

JJeerreemmyy CCaallllmmaann

"He is the standout barrister on all things partnership" Legal 500 2019

"Universally acknowledged for his unsurpassed combination of exhaustive technicalknowledge, thoroughness of approach, formidable court room presence and excellenceof client rapport". Chambers UK, 2019

Previous editions have noted that "He is without doubt one of the most brilliant mindsat the Bar in relation to LLP and partnership law".

Jeremy regularly advises managing partners on internal issues withinpartnerships/LLPs. He is frequently asked to review law firm LLP agreements tobring them into line with industry 'best practice'. Jeremy frequently acts in highlyconfidential and sensitive partnership matters as well as prominent cases such as therecent landmark litigation of Reinhard v Ondra LLP [2016] 2BCLC 571 – a ground-breaking case considering whether members can be employees, what terms applyto members and the nature of members' interests in an LLP. He is regularly involvedin disputes involving partner exits, team moves, and partnership 'bust ups' of all types.

Jeremy is a member of the Association of Partnership Practitioners (and committeemember for 6 years), has written for The Sunday Times plc, as well as other leadingtitles, and is a co-author of the soon to be published partnership text 'The Law ofPartnerships and LLPs: A Practical Guide'.

JJoonnaatthhaann GGaavvaagghhaann

Jonathan is recognised in the Legal Directories as being one of the leading juniorcounsel in the partnership/LLP field.

"Truly sophisticated … possesses a keen intellect, ready knowledge of the practice areaand a reassuring manner that is the envy of his peers." Chambers UK 2019

The "standout" Jonathan Gavaghan "receives praise for his skills in dispute resolution"and "is recognised for his superb work handling partnership exits, team moves andbreach of fiduciary duty". Who's Who Legal 2018

"Attracts special praise for his blend of deep knowledge, client-friendliness andparticularly high degree of accessibility. He is noted for his handling of issues affectingindividual solicitors or their firms, and acts on matters concerning both traditionalpartnerships and LLPs. He further offers especially extensive experience as… arbitrationcounsel in partnership disputes." Chambers UK 2018

"Incredibly thorough, forceful when required and very good in court, he always operateswith a view to getting the result you want." Chambers UK 2018

"A genuine expert on LLP and partnership law". Legal 500 2017.

Previous editions say he is "sharp, charming and absolutely devastating in cross-examination". He also receives recommendations as a leading junior in theDirectories for his chancery commercial work and property litigation.

Jonathan has particular experience in dealing with partner exits, lateral hires andteam moves both in an advisory capacity and dealing with litigation and injunctions.He appeared recently in the Patley Wood Farm LLP v Brake litigation which dealt withthe cross-over of Court orders, injunctions and arbitrations. He is a Fellow of theChartered Institute of Arbitrators, and a Recorder of the Crown Court.

NNaaoommii WWiinnssttoonn

"Extremely bright with a deep and detailed knowledge of all things partnership and LLP,she brings huge enthusiasm and energy to all her cases". Chambers UK, 2019.

"She is top of the game for partnership and LLP work, and a pleasure to work with".Legal 500, 2019

Previous editions have commented on her "commercial approach" and "greatstrategic advice".

Naomi regularly acts for and advises both firms and individual members or partnersacross a wide range of partnerships from solicitors andaccountancy firms toinvestment banking consultancies and private equity firms tomedical practices,farming partnerships and property partnerships. In particular, she regularly advises inrelation to partnership exits, team moves, restrictive covenants and remunerationdisputes. She has significant experience of advising managing partners on internalissues and also of drafting partnership and members' agreements, retirement deedsand other related documents.

JJaammeess EEggaann

James's practice has seen him instructed across the full range of Chambers'commercial, chancery, and partnership/LLP work. He has a wealth of advocacyexperience and has been instructed to advise and represent clients in the CountyCourt (small claims, fast track, and multi-track), and in the High Court for both trialsand applications.

James's recent experience in partnership law includes advising individual members inrelation to mergers, partnership exits, transfers of business and the dissolution ofpartnerships.

James also has experience in dealing with the overlap between partnerships, LLPsand insolvency procedures; in particular, the winding-up of insolvent partnerships(and concurrent bankruptcy petitions of individual partners) under the InsolventPartnerships Order 1994, and/or the winding-up of LLPs under s.14 LPPA 2000 andthe LPP Regulations 2001.

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Kill or cure?

LLPs and partnerships seminar

Jeremy Callman

Jonathan Gavaghan

Naomi Winston

James Egan

Restrictive covenants

James Egan

Obligations following departure from the firm

• Restrictive covenants invariably apply after the departuredate and include:

• Non-Compete – Seeking to prevent a partner from joininga competitor firm;

• Non-Solicitation/Non-Dealing – Seeking to prevent apartner from approaching clients or acting for them; and

• Non-poaching – Seeking to prevent a partner fromrecruiting colleagues

20/11/2019

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Bridge v Deacons [1984] AC 705• Privy Council upheld a 5-year solicitation/non-dealing

applying throughout all of Hong Kong for persons who hadbeen “a client of the partnership” during the period 3-yearsprior to the person ceasing to be a partner.

• "The public have an interest in every person's carrying on his trade freely: so hasthe individual. All interference with individual liberty of action in trading, and allrestraints of trade of themselves, if there is nothing more, are contrary to publicpolicy, and therefore void. That is the general rule. But there are exceptions:restraints of trade and interference with individual liberty of action may be justifiedby the special circumstances of a particular case. It is a sufficient justification, andindeed it is the only justification, if the restriction is reasonable - reasonable, thatis, in reference to the interests of the parties concerned and reasonable inreference to the interests of the public, so framed and so guarded as to affordadequate protection to the party in whose favour it is imposed, while at thesame time it is in no way injurious to the public.”

Key Principles

• Is restraint on trade engaged? In Tillman the SC referred toProactive Sports Management v Rooney [2011] whichendorsed a “broad, practical, rule of reason approach”

• To establish the RC is reasonable, C must establish:

1. He has a legitimate interest capable of being protected;

2. The restrictive covenants are no more than adequate toprotect the interest (meaning not excessive as regardsarea, duration or prohibited activities); and

3. Without the enforcement of such covenants, the interestor goodwill could be injured or damaged.

• Where some parts of an unenforceable covenant in restraintof trade are reasonable, can it be severed?

Tillman v Egon Zehnder [2019] UKSC 32

• The employment contract stated T would not “directly orindirectly engage or be concerned or interested in anybusiness carried on in competition with any of the businessesof the Company…” within 6 months of the termination date.

• The Supreme Court endorsed the Beckett approach:

1. Is the unenforceable provision capable of being removedwithout adding to or modifying what remains?

2. Will the remaining terms continue to be supported byadequate consideration?

3. Is it possible to remove the offending provision withoutgenerating any major change in the overall effect of allthe post-employment restraints in the contract?

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Bitter Pill LLP: Post Termination Restrictions

Clause 20

If the Outgoing Partner retires, is deemed to retire or is expelled,they shall not at any time, directly or indirectly:

[…]

20.1 During the period of six months commencing immediatelyprior to the Cessation Date, act as a solicitor or do the work of asolicitor or be concerned or interested in any firm of solicitorscarried on in competition with any of the business of the LLPwhich were carried on at the Cessation Date

Bitter Pill LLP: Post Termination Restrictions

Clause 20

If the Outgoing Partner retires, is deemed to retire or is expelled,they shall not at any time, directly or indirectly:

[…]

20.2 During the period of two years commencing immediatelyprior to the Cessation Date, to be followed by a further year,canvass instructions or solicit, supply legal services to, or in anyway interfere with any person or business who shall have been aclient of the LLP at any time during the period of three yearsimmediately preceding the Cessation Date.

How To Prevent Partners Haemorrhaging:

Hotel California/Waiting Room Clauses & Other Cures!

Jonathan Gavaghan

20/11/2019

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Different medicines, treating similar symptoms…

Three specific types of clause which seek to prevent a partner leaving when they want to:

(1)Lock-in clause following merger

(2)Lengthy notice periods

(3)Waiting Room/Hotel California Clauses

Hotel California/Waiting Room clauses

Restriction on the number of partners/members who can retireduring the same period.

“Relax!” said the night man.

“We are programmed to receive.

You can check out any time you like,

But you can never leave!”

Restraint of trade

Restraint of trade doctrine does not just apply to post termination restrictions, can apply to clauses during the duration of a contract see e.g. older cases such as:

McEllistrim v The Ballymacelligott Co-op [1910] A.C. 548

English Hop Growers Ltd v Dering [1928] 2 K.B. 174

Foley v Classique Coaches Ltd [1934] 2 K.B. 1.

Remember, the Court is not concerned with the form of the provisions but with their substance and practical effect: see Stenhouse Australia Ltd v Phillips [1974] A.C. 391, PC.

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When is a restraint not a restraint of trade?

A number of cases indicate that “ordinary commercial contracts” fall outside the doctrine of restraint of trade.

Lord Pearce in Esso Petroleum Co Ltd v Harper's Garage (Stourport) Ltd[1968] AC 269:

“Somewhere there must be a line between those contracts which are in restraint of trade and whose reasonableness can, therefore, be considered by the courts and those contracts which merely regulate the normal commercial relations between the parties and are, therefore, free from doctrine …”

Recent analysis

There has been some more recent analysis of when the doctrine of restraint of trade will be triggered, see:

Proactive Sports Management Ltd v Rooney [2012] IRLR 241

CJ Motorsport Consulting Ltd v Bird [2019] EWHC 2330 (QB) (3/9/19) [2019] IRLR 1080

The (sort of) two stage approach

The Court of Appeal in Proactive recognised a two stage approach:

(1)Whether the contract in question is in restraint of trade (or, which amounts to the same thing, whether the contract attracts the doctrine of restraint of trade)?

(2)Whether, if so, it is reasonable?

But:

Gross LJ: “these questions, though analytically separate, cannot be viewed as existing in wholly watertight compartments.”

Arden LJ: “The line between the two stages… is not clear cut, and… the analysis has to be an iterative one between them. In particular, the matters that might be raised under the second stage might also be relevant to the question whether the doctrine of restraint of trade is engaged at all.”

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What time do you apply the analysis?

The question of whether a contract attracts the doctrine of restraint of trade must be determined by reference to the contract at the time it was made: see Proactive at para 149 and CJ Motorsports at 24

“As it seems to me, how the contract has subsequently turned out is only relevant for these purposes insofar as it furnishes evidence of the nature of the contract in question when made.” (per Gross LJ in Proactive at para 149)

Stage 1 test

Murray J in CJ Motorsports reiterated the potential assistance to be gained from distinguishing between:

(1)A contract or term which absorbs someone’s services, custom or output (not covered by restraint of trade); and

(2)A contract or term which sterilises someone’s capacity (covered by restraint of trade).

There is also a hint of the Elephant test in many of the cases: see e.g. Arden LJ in Proactive at para 99 looking at the terms in the contract and saying they took it “out of the range of a normal commercial contract imposing restrictions on a contracting party's ability to carry on a business activity”.

Stage 2 test

Where a restraint of trade has been identified in a contract to which the doctrine applies, the onus is on the party in whose favour the restraint operates to show that it is reasonable: Esso Petroleum at [1968] AC 269, p 323G (Lord Pearce).

In relation to traditional partnerships and (probably) LLPs: Bridge v Deacons (supra) will apply.

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Additional Partnership/LLP foibles

A disgruntled partner/member locked in for a long time might also have recourse to other remedies rather than simply complaining of restraint of trade:

•Partner in a traditional partnership, might seek to use s. 35(f) of the Partnership Act 1890 to seek a dissolution

•Member of LLP might threaten to wind up the LLP under the just and equitable ground

Bitter Pill LLP: waiting room clause

Clause 16.2:

No more than 3 FEPs may give notice to retire from membership on any Accounting Date. If more than 3 FEPs give notice to retire terminating on the same Accounting Date, then only the notices from the 3 most senior FEPS (in terms of time spent as FEPs or if that is the same, in terms of Profit Points allocated for the previous 2 years) shall be effective. Any notice from other FEPs terminating on that Accounting Date irrespective of when served will be deemed void and of no effect.

Anti-team move clauses

Jeremy Callman

20/11/2019

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Wider context

Fit within a wider range of clauses:

• Interface with notice periods

• Interface with waiting room/Hotel California clauses

• Limit on number of retirements from a department

• Interface with pre-termination duties (express, implied and fiduciary)

• Interface with garden leave

• Interface with confidentiality

The potential for injunctive relief, including springboard injunctions

Types of anti-team move clauses

• Anti-inducing clauses:

• whilst a member/partner, would likely to caught bygood faith clauses and a host of other duties

• post termination may well be enforceable applying the general RC principles discussed above

• Anti-coordinated departure clauses: really a variant ofwaiting room clauses discussed above

• Anti-association clauses: prevents engagement in a business with others

Focus on anti-association clauses: do they work?

• Bloch & Brearley (Edn 4, para 11.224) the authors express the view that in the employment context: “a court is likely to be reluctant to enforce such a covenant”

• Hydra Plc v Anastasi [2005] EWHC 1559 (QB) at paras 51-54 limited discussion of a clause prohibiting for 12 months entering into partnership or association with a “Key Person”, being someone employed in the 12 month period prior to the termination date

• no discussion of whether the clause was enforceable (and it isnot clear whether it was challenged) but Royce J said that the individual concerned was “technically in breach of the clause”

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Problems with drafting and scope

• Problems arise with trying to draft such clauses sufficientlyclearly and narrowly, eg:

• what happens if someone who is subject to such a clause is joined in a firm by someone from his/her old firm butwho is free from such covenants?

• in big firms there will often be many individuals from the same prior firms, how can it be legitimate or reasonable to prevent this?

• One can see that the aim of preventing a group going as a team to a new firm could be legitimate and reasonable; whilst the drafting is difficult, is it impossible to achieve?

Bitter Pill LLP: team move clause

Clause 17.1 of the Members Agreement provides:

an FEP may not enter into any partnership with any person who has in the period of two year prior to the FEP’s leaving date been an FEP of the LLP, where that other individual has:

(a) at any time within that period of two year worked with that FEP; and

(b) they are proposing to enter into that partnership relationship with a view to carrying on a business in competition to the LLP or any part of it.

Forfeiture & liquidated damages clauses

Naomi Winston

20/11/2019

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Forfeiture: the rule

The forfeiture rule:

A fiduciary who breaches their duties can lose their right to remuneration.

The rule may not apply where:

• the breach was made honestly (i.e. innocently): see Keppel v Wheeler [1927] 1 KB 577 and Kelly v Cooper [1993] AC 205; or

• in the court’s view, it would not be proportionate and equitable to apply it: see The Governor of the Bank of Ireland v Jaffery; Avrahami v Biran [2012] EWHC 1377 (Ch).

Even if the rule applies, an allowance might be made for skill and effort: see Premium Real Estate Ltd v Stevens [2009] 5 LRC 56; Gamatronic (UK) Ltd v Hamilton [2016] EWHC 2225.

Forfeiture: remuneration

• For the rule to apply, the money due to/received by fiduciary received must have been remuneration for services.

• Traditionally, partners/members get a profit share, not remuneration.

• But Hosking v Marathon Asset Management LLP [2017] Ch 157 says that, in some circumstances, they can be seen as being remunerated for services.

• In that case, former founding members received 50% of the ‘profit share’ of current members who were still working. So:

• part of the money was paid to reflect an interest in the business; and

• part as remuneration for services.

Forfeiture: LLPs & partnerships

Newey J said, at [43(ii)]:

“it will often (typically, I suspect) be impossible to characterise all or any

particular part of the profit share of a partner or LLP member as "remuneration””.

But consider the import of:

• Partners/members working part-time for less profit share butsame capital contribution;

• Reductions in profit share for sick leave/family leave.

May be a more regular occurrence than we expect.

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Liquidated damages

• Liquidated damages clauses set out the sum that will be due by a party if they breach a primary contractual obligation.

• Purposes: certainty; no need to prove loss; no need to quantify loss.

• Usually an exhaustive remedy, excluding a claim for general damages.

• A party cannot rely on these clauses beyond actual loss where:

• he has prevented the other from complying with the contract;

• he has failed to comply with contractual procedure; or

• the clause is penal.

Penalties: the old test

The old test:

• Whether the clause was a genuine pre-estimate of the damage that would be caused by a breach, calculated at the time the contract is made.

• The purpose of the clause should not be deterrence.

• The old test may still apply where the clause is trying to protecta party in circumstances where damages would be an adequate remedy.

• But it will not apply where the aim of the clause is to do more than just require the payment of damages – e.g. to influence one party’s behaviour (i.e. deterrence) to protect a legitimate interest.

Penalties: the new test(s)

The new test: The Supreme Court in Cavendish Square Holding BV v Talal El Makdessi [2016] AC 1172 said:

“The true test is whether the impugned provision is a secondary obligation which imposes a detriment on the contract-breaker out of all proportion to any legitimate interest of the innocent party in the enforcement of the primary obligation”: per Neuberger & Sumption at [32]; or

“What is necessary in each case is to consider, first, whether any (and if so what) legitimate business interest is served and protected by the clause, and, second, whether, assuming such an interest to exist, the provision made for the interest is nevertheless in the circumstances extravagant, exorbitant or unconscionable”: per Lord Mance at [152].

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Bitter Pill LLP: forfeiture/liquidated damages

If any member commits a material breach of this Agreement, then the LLP shall be entitled to:

(a) withhold or clawback the profit share of that member for the year in which that breach was committed in accordance with the forfeiture rule; and

(b) compensation for that breach which shall be calculated in the following manner:...

(iv) where the breach relates to a client of the LLP, by multiplying all of the fees billed in relation to that client in the financial yearproceeding the breach by 1.5;...

And, for the avoidance of doubt, the parties to this Agreement agree that these are genuine pre-estimates of loss and are commercially justified because it protects the legitimate interests of the LLP.

Kill or Cure?LLPs and partnerships seminar

Jeremy Callman

Jonathan Gavaghan

Naomi Winston

James Egan

20 November 2019

These notes and slides areprovided free-of-charge. Thecontents do not constitute legaladvice and should not be reliedon as such. No responsibility forthe accuracy and/or correctnessof the information set out herein,or for any consequences ofrelying on it, is assumed oraccepted by us, any member ofChambers or by Chambers as awhole.

20/11/2019

Ten Old Square: Kill or Cure Case Study

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1. Bitter Pill LLP is a law firm founded in 2004 which specialises in pharmaceutical companies. When it was first formed, there were 5 Full Equity Partners (FEPs) and 10 salaried “partners”.

Background

2. Ivor Deathwish became managing partner in 2012 and proceeded to expand the firm rapidly. By 2015 there were 30 FEPs and 150 salaried partners. The firm took on a 15 year lease of a brand new state of the art office building in the City of London with 3 year rent reviews and opened another 6 new offices that year.

3. Profits started to fall in 2016 and the spectre of Brexit caused a further loss of client work. There were a series of angry partners’ meetings in 2018 about the trajectory of the firm, but no resolution to the disputes was reached.

Penny Cillin: restrictions

4. Penny Cillin is a junior FEP and has received an invitation to become a ‘Senior Lawyer’ and 25% shareholder in Cutem & Sue Solicitors Limited, a medical negligence firm based in Manchester. Penny informs Bitter Pill LLP that she intends to leave and wishes to take the business of one of her clients, Steph O’Scope Supplies Ltd who is based in Newcastle. In response, Ivor Deathwish sends Penny an email stating:

“Penny, please read the Agreement. Clause 20.1 stops you from working as a solicitor or being ‘concerned or interested’ in any competitor firm for 6 months. Clause 20.2 stops you from taking Steph O’Scope’s business for two years.”

5. Clause 20 of the Members Agreement includes, amongst other restrictions, the following:

If the Outgoing Partner retires, is deemed to retire or is expelled, they shall not at any time, directly or indirectly:

20.1 During the period of six months commencing immediately prior to the Cessation Date, act as a solicitor or do the work of a solicitor or be concerned or interested in any firm of solicitors carried on in competition with any of the business of the LLP which were carried on at the Cessation Date (the “Non-Compete Covenant”);

20.2 During the period of two years commencing immediately prior to the Cessation Date, to be followed by a further year, canvass instructions or solicit, supply legal services to, or in any way interfere with any person or business who shall have been a client of the LLP at any time during the period of three years immediately preceding the Cessation Date. (the “Non-Act/Non-Solicitation Covenant”)

6. Clause 24.1 of the Members Agreement provides:

(a) Each covenant contained in Clause 20 shall be construed as a separate covenant and if one or more of the covenants is held to be against the public interest or unlawful or in any way an unreasonable restraint of trade the remaining covenants shall continue to bind the Outgoing Partner.

(b) If any covenant contained in Clause 20 would be void as drawn but would be valid if some part of the covenant were deleted the covenant in question shall apply with such deletion as may be necessary to make it valid and effective.

7. What is the effect of the restrictive covenants?

Ten Old Square: Kill or Cure Case Study

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Liv Moore: waiting room clauses

8. Liv joined the firm as an FEP in 2015 in the dispute resolution department. The above events led her to decide to join a competitor firm. She gave notice to retire on 1 April 2019, terminating on 30 April 2020. On 20 April 2019, 3 senior FEPs (who joined in 2004 and 2005) gave notice, as did 3 others on 21 April 2019.

9. Retirement from membership of the LLP by FEPs was dealt with under clause 16 of the Members Agreement, in the following way:

16.1 Subject to clauses 16.2 and 16.3, an FEP may retire from membership of the LLP by giving no less than 12 months’ written notice of their intention to retire terminating on an Accounting Date. Notice shall be given to the Managing Partner, save if the Managing Partner is the FEP retiring then he or she shall give notice to the Senior Partner.

16.2 No more than 3 FEPs may give notice to retire from membership on any Accounting Date. If more than 3 FEPs give notice to retire terminating on the same Accounting Date, then only the notices from the 3 most senior FEPS (in terms of time spent as FEPs or if that is the same, in terms of Profit Points allocated for the previous 2 years) shall be effective. Any notice from other FEPs terminating on that Accounting Date irrespective of when served will be deemed void and of no effect.

16.3 All partners shall automatically retire on the Accounting Date following their 65th birthday.

10. Salaried partners could retire on 6 months written notice.

11. “Accounting Date” was defined as 30 April of any year, or such other date as the members may agree by majority vote.

12. Is Liv stuck at Bitter Pill LLP?

Bitter Pill LLP : team moves

13. The 3 senior FEPs who resigned on 20 April 2019 are all members of the same team at Bitter Pill LLP and propose to join the same department of a competitor firm (Apothecary LLP). The firm that Liv intends to join is a different competitor (Home Remedy LLP), but one at which two former FEPs of Bitter Pill LLP who were in the same team as Liv are already in situ as equity partners, having joined that competitor 10 months ago. Prior to that date, Liv worked closely with those two individuals.

14. Liv is informed by the Managing Partner that she will have to serve a fresh notice terminating on 30 April 2021, albeit whether it is valid will depend on who else seeks to retire on that Accounting Date.

15. Clause 17.1 of the Members Agreement provides:

an FEP may not enter into any partnership with any person who has in the period of two year prior to the FEP’s leaving date been an FEP of the LLP, where that other individual has:

(a) at any time within that period of two year worked with that FEP; and

(b) they are proposing to enter into that partnership relationship with a view to carrying on a business in competition to the LLP or any part of it.

16. Can Bitter Pill LLP use the anti-team move clause to prevent members joining competitors?

Ten Old Square: Kill or Cure Case Study

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Liv Moore: forfeiture/liquidated damages

17. Liv is frustrated when she is told she cannot retire yet and arranges meetings between her three key clients and Home Remedy LLP. Two of the clients announce that they are leaving Bitter Pill LLP; one is going to the firm Home Remedy LLP, the other is to an unrelated firm. The client going to Home Remedy LLP has only been instructing Bitter Pill LLP since the start of this financial year. Bitter Pill LLP only finds out about Liv’s involvement when it asks the CEO of one of the clients why his company is leaving.

18. The Members’ Agreement contains a standard members’ duties and obligations clause, which among other things, imposes a duty of good faith on members towards the LLP, requires them to account to the LLP, to devote their whole time and attention to the LLP and to promote the LLP’s business.

19. Clause 17.8 then provides as follows:

If any member commits a material breach of this Agreement, then the LLP shall be entitled to:

(a) withhold or clawback the profit share of that member for the year in which that breach was committed in accordance with the forfeiture rule; and

(b) compensation for that breach which shall be calculated in the following manner:

...

(iv) where the breach relates to a client of the LLP, by multiplying all of the fees billed in relation to that client in the financial year proceeding the breach by 1.5;...

And, for the avoidance of doubt, the parties to this Agreement agree that these are genuine pre-estimates of loss and are commercially justified because it protects the legitimate interests of the LLP.

20. What can Bitter Pill LLP do to punish Liv in relation to its lost clients?

We offer expert legal advice and representation with barristers who specialise in traditional

Chancery and commercial Chancery law.

Chambers has extensive, collective expertise and considerable practical experience of how

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