| Restrictions | OK |
|---|---|
| Jurisdiction | Employment Relations Authority - Christchurch |
| Reference No | CA 37/07 |
| Hearing date | 30 Mar 2007 |
| Determination date | 10 April 2007 |
| Member | P Cheyne |
| Representation | N Cervin ; T McGinn |
| Location | Christchurch |
| Parties | Maccaferri NZ Ltd v Langham |
| Summary | COMPLIANCE ORDER – Restraint of trade – Applicant sought order requiring respondent to comply with restraint of trade provision in unsigned employment agreement – Respondent claimed not bound by agreement – Claimed employment agreement formed orally before received draft written agreement - Respondent argued written offer no longer available because applicant did not respondent by stipulated date - Worked for applicant more than a year and assumed responsibilities and benefits of position - Respondent accepted terms of agreement not so much by silence but by actions – Whether restraint enforceable – No dispute level of remuneration agreed orally - Respondent argued express consideration past and ineffective to support restraint - Offer accepted on receipt of draft agreement - At time offer accepted, consideration for restraint not past - Respondent also claimed applicant breached agreement so could not rely on restraint - No repudiatory breach as resigned and respondent paid notice - Six month restraint period covering whole of New Zealand reasonable – Valid and enforceable restraint of trade - Authority found applicant conveyed message employment ended immediately notwithstanding intention to put on garden leave - Respondent not disadvantaged or prejudiced by delay in applicant lodging proceedings - Did not count against granting compliance order - Whether failure to advise respondent of right to independent advice allowed him to avoid order - Answer lay with Authority's obligation to make determination in accordance with substantial merits of case - Failure of form not substance - Respondent aware of restraint but chose not to get advice - Current employment with new employer put respondent in breach of agreement - Respondent to comply with agreement and cease performance of work for new employer similar to that performed by him at applicant – Compliance ordered - PRACTICE AND PROCEDURE - Respondent gave evidence that in reliance on oral agreement with applicant, resigned from prior employment – Respondent not in employment at time accepted employment with applicant – By giving untruthful evidence obstructed Authority’s investigation and failed to act in good faith – Issue of untruthful evidence to be referred to Solicitor General for appropriate action - Sales engineer |
| Result | Application granted ; Orders accordingly ; Costs reserved |
| Main Category | Compliance Order |
| Statutes | ERA s63A, ERA s63A(4), ERA s65(1), ERA s68(2)(d), ERA s137, ERA s157(1), ERA s157(2), ERA s157(3) |
| Cases Cited | Grey Advertising (New Zealand) Ltd v Mainkovich [1999] 2 ERNZ 844;Marine Helicopters Ltd v Stevenson [1996] 1 ERNZ 472;Quantum Global Ltd v Day & Anor unreported, A Dumbleton, 24 January 2003, AA 23/03;Royal v Axon Computer Systems Ltd [1994] 1 ERNZ 312;Space Industries (1979) Ltd v McKavanagh [2000] 1 ERNZ 490;University of Auckland Primary Health Care Trust v Sewell [2000] 1 ERNZ 781;Warwick Henderson Gallery v Weston (No 2) [2005] ERNZ 921 |
| Number of Pages | 7 |
| PDF File Link: | ca 37_07.pdf [pdf 46 KB] |