$200K borrowed from husband's company funded wife's startup that took his clients
A Newfoundland court has ordered a pest control company owned by an employee's wife to produce confidential business records after the company acquired major clients and hired eight workers from the husband's former employer shortly after his resignation. Justice Garrett A. Handrigan of the Supreme Court of Newfoundland and Labrador ruled on Feb. 3, 2026, that Viking Pest Management Inc. must turn over client lists, contracts, and financial statements despite claims the wife operated independently of her husband, Kenneth Pretty, Rentokil Canada Corporation's former Newfoundland branch manager.
The case involves a timeline that raised questions about whether restrictive covenants could be circumvented through family business structures.
The arrangement that wasn't
Kenneth Pretty worked for Rentokil from October 2022 to June 2023 after the company merged with his previous employer, Terminix. During his eight-month tenure, Pretty sought Rentokil's permission to operate his own pest control company, North Lab Pest Control Ltd., while serving as branch manager.
According to testimony from Safik Malick, Rentokil's HR director, Pretty's proposal went beyond a simple side business. Malick testified: "Sure, though it would have been the fact that he thought that it would have been okay to get paid by the organization for time that he spent doing North Lab work. He thought it would be okay to use the same vendor under the Terminix banner to purchase equipment for North Lab. He thought that it was fine to, under North Lab's arrangement to have that equipment stored at the Terminix building, and the phone number as well, …so all of these were things that he was primarily concerned about…"
Rentokil refused. Pretty resigned on June 8, 2023, claiming constructive dismissal.
Employee’s wife incorporated new business
In March 2023, less than three months before Pretty's resignation, his wife Kathy Pretty incorporated Viking Pest Management. She testified that Quebec-based Maheu & Maheu had approached her husband to subcontract pest control work in Newfoundland, but Kenneth declined because of his Rentokil employment.
Viking soon acquired substantial accounts previously held by Rentokil, including contracts with Loblaws, Ultramar, and Central Dairies. The company also hired eight former Rentokil employees, including the couple's son, Evan Pretty. When asked how the employees came to work at Viking, Kathy Pretty stated: "They, some contacted me, I contacted some of them because I…I have a relationship with these people."
North Lab loaned Kathy Pretty $200,000, which she transferred to Viking as a shareholder loan for startup costs. Viking and North Lab shared office space, the same bank, and the same accountant.
Husband and wife’s companies not at arm’s length
Justice Handrigan found the business relationships warranted scrutiny. The court noted that "Mr. Pretty, Ms. Pretty, North Lab and Viking do not operate at arm's length from each other," citing their shared address, banking, accounting services, and the flow of money and employees between entities.
Kenneth Pretty remained bound by confidentiality and non-solicitation obligations from his 2015 asset purchase agreement with Rentokil's predecessor until June 2024.
The court ordered Viking to produce documents from May 2023 to June 2024, finding "that they may inform and assist Rentokil in prosecuting its claim, as well defending against the counterclaim that Mr. Pretty has brought against it."
