Question 1
Indulgence Aesthetics Clinic Pte Ltd (“IAC”) is a medical company that specialises in aesthetic
medicine, an extensively broad term for medical specialties that focus on improving cosmetic
appearance, whether on the hair, face or body. They have a one-stop clinic located at Orchard
Road, called “IAC ORCHARD”, where customers would visit to receive various medical
aesthetic treatments with the aid of medical-grade equipment.
Angela is a dermatologist who has been trained in England, and who has worked and lived
there for 10 years. Because of her overseas training and experience, she was employed as an
aesthetic doctor at IAC ORCHARD. There are two other aesthetic doctors practising at IAC
ORCHARD.
Angela proved to be a very popular aesthetic doctor who enjoyed great rapport with her clients
at IAC ORCHARD. Many of these clients trusted Angela implicitly and would procure
whatever treatments Angela recommended, so much so that Angela’s clients accounted for an
average of 60% of IAC ORCHARD’s monthly income. After working at IAC ORCHARD for
three years, Angela decided to leave IAC ORCHARD and set up a dermatology clinic to
practise in dermatology (i.e. the branch of medicine dealing with the skin and its diseases). She
chose to set up this clinic in a shopping mall next to IAC ORCHARD, and she managed to
accomplish this within 3 months of leaving IAC ORCHARD.
IAC is not happy with Angela and wants to sue Angela for breach of her employment contract.
The provision which is in contention is Clause 14, which is set out below:
“In the event that an employee leaves Indulgence Aesthetics Clinic Pte Ltd
(IAC), whether by resignation or dismissal, the employee shall not, for a period
of 12 months after such cessation of employment, practise any form of medicine
directly or indirectly related to aesthetics within a 5-kilometre radius from IAC
ORCHARD, and a 5-kilometre radius from any other new IAC clinic that is set
up whether before or after the employee’s cessation of employment at IAC.”
(a) Discuss whether IAC is able to enforce Clause 14 against Angela, based on the legal
rules relating to restraint of trade.
(b) Give two (2) suggestions to IAC on what they should do with their employment contracts
(between IAC and their aesthetic doctors) to prevent this problem (relating to the
potential non-enforceability of Clause 14 due to the legal rules relating to restraint of
trade) from arising, with brief explanations for your suggestions. Your suggestions
should be based on contract law principles.