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Mellstrom V. Garner Notes

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MELLSTROM V. GARNER FACTS The plaintiff and the defendants are all chartered accountants. The plaintiff was in partnership with two of the defendants up to April 7, 1967. He then entered into an agreement dissolving the partnership in which he had been the moving spirit; and the agreement provided that he should continue (on terms which it is unnecessary for me to recite) as what was defined in the agreement as a "salaried partner." One clause of the agreement which apparently is causing the plaintiff concern is clause 5(b). It is in these terms: "It is further provided that the retiring partner shall not accept as clients clients of the old partnership" "and shall not at any time hereafter interfere with or intervene or endeavour to divert any of the business intended to be carried on by the continuing partners and forming the basis of goodwill." No one has ever suggested that it prevents the plaintiff from acting for persons who had been clients of the partnership after April 7, 1967, and during the time when he was a salaried partner. It is conceded that he would be entitled to act for such clients if they came to him of their own free will. What has disturbed the plaintiff about the second part of the clause is whether it prohibits him from canvassing the clients to whom I have referred. Accordingly he issued this originating summons endeavouring to obtain a declaration that the clause on its true construction does not prohibit him from canvassing these clients. HOLDING HARMAN LJ The Supreme Court Practice (1970), so far as it has got anything to do with it, in a note on what is now R.S.C. Ord. 15, r. 16 (which originally was Ord. 25, r. 5) says this: "No action … shall be open to objection on the ground that a merely declaratory judgment or order is sought thereby, and the court may make binding declarations of right whether or not any consequential relief is or could be claimed." In the Supreme Court Practice (1970), p. 202, one finds this: "Where specific relief, other than a declaration, is not claimed, the jurisdiction to make a binding declaration of right should be exercised with great caution"; and, just above that, "The power to make binding declarations of right is a discretionary power." Various examples of that are given. It goes on:

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