| Restrictions | OK |
|---|---|
| Jurisdiction | Employment Relations Authority - Auckland |
| Reference No | [2014] NZERA Auckland 531 |
| Hearing date | 16 Dec 2014 |
| Determination date | 22 December 2014 |
| Member | V Campbell |
| Representation | E Hartdegan ; C Eggleston, S Ebenezer |
| Location | Auckland |
| Parties | Ascot Aluminium Ltd v Lee and Ors |
| Other Parties | Grima, Feleti-Faanama, Ghalib, Nimalan, Southern Cross Installation Ltd, Royale Aluminium Ltd |
| Summary | INJUNCTION - RESTRAINT OF TRADE - Applicant sought interim injunction requiring respondents to comply with fidelity, confidentiality, non-solicitation and restraint of trade (ROT") provisions in employment agreements ("EA") - Whether second to fifth respondents breached duty of fidelity and misused confidential information - Whether second and third respondents breached non-solicitation clauses - Whether second to fourth respondents involved in competing businesses" |
| Abstract | AUTHORITY FOUND -;INJUNCTION - RESTRAINT OF TRADE: Duty of fidelity did not survive termination of employment relationship. Issue to be resolved as to whether second and third respondents had copies of confidential information at meeting with applicant's client. Arguable case that second and third respondents breached confidentiality obligations. Third respondent approached applicant's client within six month period of non-solicitation clause with view to tender for next stage of development. Order that third respondent comply with non-solicitation clause would be ineffective given clause now expired. Strongly arguable that second respondent not bound by unsigned EA but applicant had arguable case to be resolved by testing of evidence. No arguable case second respondent sought actively to recruit third and fourth respondents to compete with applicant. No evidence of proprietary interest requiring protection of ROT. No evidence third or fourth respondents had direct or indirect interest in competing business. No submissions from applicant as to why 24 month ROT required or why 10 to 80 kilometre geographic boundary required. Third respondent's work located outside geographic scope of ROT. No evidence of consideration offered for ROTs. No arguable case third or fourth respondents breached ROT. Strongly arguable second respondent not bound by ROT in unsigned EA but applicant had arguable case to be resolved by testing of evidence. Applicant did not delay in raising claims. Damages likely to be effective alternative remedy. Balance of convenience favoured respondents. Substantive matter able to be heard with relatively short delay. Overall justice of case against applicant. Application for injunctive relief declined. |
| Result | Application dismissed ; Costs reserved |
| Main Category | Injunction |
| Cases Cited | American Cyanamid Co v Ethicon Ltd [1975] AC 396;Fletcher Aluminium Ltd v O'Sullivan [2001] ERNZ 46 ; [2001] 2 NZLR 731;Fuel Espresso Ltd v Hsieh [2007] ERNZ 60 ; [2007] 2 NZLR 651;Gallagher Group Ltd v Walley [1999] 1 ERNZ 490;Marsden Providors (1988) Ltd v Cotterill (1989) 2 NZELC 97,094;Mason (Pauper) v Provident Clothing and Supply Co, Ltd [1913] AC 724;Medic Corp Ltd v Barrett [1992] 3 ERNZ 523;Pottinger v Kelly Services (New Zealand) Ltd [2012] ERNZ 411 |
| Number of Pages | 17 |
| PDF File Link: | 2014_NZERA_Auckland_531.pdf [pdf 195 KB] |