Doc, a supplier of building materials, entered into the following transactions:(a) An agreement to sell some goods to a longstanding friend, Ed. The contractual document, however, actually stated that the contract was made with Ed’s company, Ed Ltd. Although the materials were delivered, they have not been paid for and Doc has learned that Ed Ltd has just gone into insolvent liquidation. (4 marks)(b) Doc had employed a salesman, Fitt, whose contract of employment contained a clause preventing him, Fitt, from approaching any of Doc’s clients for a period of two years after he had left Doc’s employment. Doc has found out that, on stopping working for him, Fitt has started working for a company, Gen Ltd, wholly owned by Fitt and his wife, and is approaching contacts he had made while working for Doc. (6 marks)Required:In the context of company law, advise Doc as to the legality and likely outcome of the above situations.Notes:– in (b) the legality of the restraint of trade clause in Fitt’s contract of employment may be assumed; and– the mark allocation is shown against each of the transactions above.(10 marks)
