| Restrictions | OK |
|---|---|
| Jurisdiction | Employment Relations Authority - Auckland |
| Reference No | AA 272/07 |
| Hearing date | 2 Jul 2007 |
| Determination date | 03 September 2007 |
| Member | R Arthur |
| Representation | A Clements ; M Gonzales |
| Location | Auckland |
| Parties | Rodwil Enterprises Ltd (previously t/a War Hair Design) v Dominguez & Anor |
| Other Parties | Nirvana Hair and Beauty Ltd |
| Summary | RESTRAINT OF TRADE - Applicant alleged first respondent breached restraint of trade by providing hairdressing services to its former clients at second respondent, 50 metres away - First respondent prohibited from soliciting clients dealt with in preceding six months for three months after employment ended, or competing within three kilometre radius - Restraint reasonable, valid and enforceable - Subsequent agreement entered into by parties after employment ended put beyond any doubt first respondent’s acceptance of reasonableness of restraints - First respondent obliged to honour non-solicitation and non-dealing obligations - Whether respondent “dealt” with clients who followed him to new salon - Evidence established he provided services to clients covered by restraint and later agreement - Remedies - Future loss related to clearly defined period as applicant sold business - Revenue gained by second respondent appropriate measure of loss but revenue from services provided by other stylists to former clients excluded as evidence did not clearly establish respondent “dealt” with those clients - Twenty percent reduction to reflect client turnover - Claim against second respondent for aiding and abetting breach adjourned - UNJUSTIFIED DISMISSAL - Counterclaim - Whether dismissed or resigned - Applicant raised possibility of looking for new job with respondent's owners - Alleged told to finish work that day - Following day applicant sent letter purporting to resign - Appeared parties confused over meaning of conversation - English not applicant’s first language - Confusion over notice period misunderstood as direction to leave immediately - Authority not satisfied events comprised dismissal - COSTS - Length of investigation meeting less than one day - Costs of $1,500 reasonable - Hairdresser |
| Result | Application granted ; Damages ($3,012) ; Interest (10.76%) ; Counterclaim dismissed ; Costs in favour of applicant ($1,500) |
| Main Category | Restraint of Trade |
| Statutes | ERA Second Schedule cl11 |
| Cases Cited | Dawnay, Day & Co Ltd & Anor v D'Alphen & Ors [1997] EWCA Civ 1753 (22nd May 1997);Dawnay Day & Co Ltd v de Braconier d’Alphen [1997] IRLR 285 (HC);Fletcher Aluminium Ltd v O’Sullivan [2001] 1 ERNZ 46;Kostic v Dodd & Milligan t/a Allan Milligan Cars and/or Motorworld Systems Ltd unreported, Couch J, 11 July 2007, CC 14/07;Servilles Ltd v Whiting unreported, Colgan J, 2 June 2000, AC 47/00;Whangarei College Board of Trustees v Lewis [2000] 1 ERNZ 397 (CA) |
| Number of Pages | 16 |
| PDF File Link: | aa 272_07.pdf [pdf 52 KB] |