Question
Three years ago, Dr. Cayla Swee started a dental business in the western part of Singapore called Toothkind. Cayla graduated from a local university with
Three years ago, Dr. Cayla Swee started a dental business in the western part of Singapore called "Toothkind". Cayla graduated from a local university with a dentistry degree and had previously worked at her uncle's dental clinic. As an environmentally conscious person, Cayla implemented many sustainability measures in Toothkind. For example, Toothkind utilises biodegradable and environmentally friendly materials in its dental treatments, and practises waste minimisation. A healthcare company, Avant Health, contacted Cayla in November last year to acquire the business of Toothkind, with a view to expanding Toothkind's operations throughout Southeast Asia. Cayla agreed to the deal with Avant Health, which included a "non-compete" clause in their contract that stated as follows:
Non-Compete Clause For a period of five (5) years after the date of this Agreement, Dr. Cayla Swee shall not set up or own any dental business, or practise dentistry in any form, in competition with Toothkind in Singapore or any other part of Southeast Asia.
At the end of last year, Cayla was approached by an ex-classmate, Vincent, to work at his soon-to-open dental clinic in the central part of Singapore called "Alba Dental". Vincent was keen to introduce sustainable business practices at Alba Dental, and he felt that Cayla would be able to contribute significantly in this aspect. (a) Discuss whether Avant Health is able to enforce the "non-compete" clause against Cayla if she were to work at Alba Dental, based on the legal rules relating to restraint of trade. (For this Question 1(a), you are not required to discuss the doctrine of severance.)
(b) Describe the doctrine of severance (i.e. the "blue-pencil" test), and explain if it can be applied (and if so, to what extent) to the "non-compete" clause in this scenario.
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