BUS201: Indulgence Aesthetics Clinic Pte Ltd (“IAC”) is a Medical Company that Specializes in Aesthetic Medicine: Contract and Agency Law Assignment, SUSS, Singapore

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 practicing at IAC ORCHARD.

Angela proved to be a very popular aesthetic doctor who enjoyed great rapport with her clients 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

practice 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, practice any form of medicine directly or indirectly related to aesthetics within a 5-kilometer radius from IAC ORCHARD, and a 5-kilometer 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.