| Restrictions | OK |
|---|---|
| Jurisdiction | Employment Relations Authority - Auckland |
| Reference No | [2012] NZERA Auckland 69 |
| Hearing date | 20 Feb 2012 |
| Determination date | 24 February 2012 |
| Member | R Arthur |
| Representation | B Syred ; A Silberstein |
| Location | Auckland |
| Parties | Dirtworks Ltd (as trustee of Dirtworks Trust) v Blomfield and Anor |
| Other Parties | Marshall |
| Summary | INJUNCTION – Applicant sought interim injunction – First respondent (“B”) dismissed for redundancy – Second respondent (“M”) resigned employment – B and M started new company – Applicant claimed B, before employment ended with applicant, obtained applicant’s clients and B and M carried out work for own benefit not applicant’s – Applicant claimed B and M in breach of terms of employment agreements – Applicant claimed activities resulted in loss of revenue for applicant – B and M claimed did not agree to two year non-solicitation clause – Authority found B and M entered employment with applicant on now-disputed terms – Found B and M worked for and paid by applicant for work in knowledge applicant offered B and M employment on terms that included non-solicitation clause – Found email correspondence between applicant and B at time did not suggest B not bound by agreement and terms – B claimed voiced opposition about clause but applicant denied knowledge of opposition – Found unclear whether objection was to non-solicitation or that clause ran for so long – Found M aware of terms on which employed – Found applicant established arguable cases that B breached terms of employment regarding conflict of interest and misuse of confidential information by arranging cleanfill tipping from contractor clients who understood arrangement was with applicant but paid B – Found applicant established arguable case that B and M breached terms of non-solicitation and misuse of confidential information – Found applicant established arguable case that actions of B particularly resulted in losses of revenue from business – Found applicant established arguable case that B and M had access to trade secrets and trade connections in which applicant had legitimate proprietary interest for which protection was reasonably necessary – Found non-solicitation clause too wide as had no geographical limit and two year length arguably too long – Applicant accepted limitations on non-solicitation clause – Found applicant had arguable case for reasonableness and enforceability of non-solicitation clause on geographic limits identified for period of six months – Found no evidence B and M would be able to meet award of damages – Found B had number of debts – Found award of damages not adequate alternative remedy – Found applicant suffered revenue loss – Found if interim injunction not granted, applicant would likely continue to suffer losses and award of damages may not be able to be paid by B and M – Found B and M had reasonable prospects for employment or business which did not rely on taking custom from applicant – Found balance of convenience favoured applicant – Found overall justice supported interim injunction – Found B and M not to solicit or carry out work or services involving accepting or importing cleanfill for any of applicant’s clients in specified area within specified timeframe – Found applicant to lodge with Authority sum calculated that was due to B and M in final pay to be held in interest bearing account until further order – Found B and M not restricted from working for primary contractor – Found client list included all those clients that B and M would reasonably be expected to know were clients of applicant – Machine Operators |
| Result | Application granted ; Costs reserved |
| Main Category | Injunction |
| Statutes | ERA s134;ERA s162;Employment Relations Authority Regulations 2000 r8(3) |
| Cases Cited | Credit Consultants Debt Services NZ Ltd v Wilson (No 2) [2007] ERNZ 205;Fuel Espresso Limited v Hsieh [2007] ERNZ 60;The Broadcasting Corporation of New Zealand v Nielson (1988) 2 NZELC 96,040;Tullet Prebon (Australia) Pty Ltd v Simon Purcell [2008] NSWSC 852 |
| Number of Pages | 17 |
| PDF File Link: | 2012_NZERA_Auckland_69.pdf [pdf 81 KB] |