The Court of Appeal in this case found that the High Court was
wrong in holding that Mr Ranson had fiduciary duties towards his
employer. The Court of Appeal found that Mr Ranson had only the
ordinary duty of loyalty owed by employees, which was not to be
confused with the distinct and greater duty of loyalty that is
peculiar to directors.
Mr Ranson was not a director and therefore his implied duty of
loyalty required him only to have regard to the interests of his
employer. He was not obliged to sacrifice his own interests to
further those of his employer or to act with the
"single-minded or exclusive loyalty" required of a
The Court of Appeal made repeated reference to the earlier case of
Wessex Dairies Ltd v Smith, in which it was held that an employee
can "be as agreeable, attentive and skilful as it is in his
power to be to others, with the ultimate view of obtaining the
benefit of the customers' friendly feelings when he calls upon
them if and when he sets up business for himself".
The only way in which Mr Ranson's duties to the company might
have be modified was by the express terms of his contract. The
Court of Appeal found that there was no evidence to show any
This decision reflects the more traditional and accepted law in
relation to the distinct duties of employees and directors. Subject
to any further appeal, it closes down the window temporarily opened
up by the High Court's original decision for employer's to
pursue claims against employees on the basis of them having
fiduciary duties equivalent to directors.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
To print this article, all you need is to be registered on Mondaq.com.
Click to Login as an existing user or Register so you can print this article.
In October 2012, the Court of Appeal confirmed that a Service Provision Change ("SPC") TUPE transfer can only occur where the client who receives the service, before and after the change, remains the same (Hunter v McCarrick  EWCA Civ 1399).
Following much debate, on 24 April 2013 the House of Lords finally gave its approval to employee shareholder status which will now take effect from Autumn 2013.
Some comments from our readers… “The articles are extremely timely and highly applicable” “I often find critical information not available elsewhere” “As in-house counsel, Mondaq’s service is of great value”