| Restrictions | OK |
|---|---|
| Jurisdiction | Employment Relations Authority - Auckland |
| Reference No | [2011] NZERA Auckland 223 |
| Hearing date | 20 May 2011 |
| Determination date | 25 May 2011 |
| Member | R Arthur |
| Representation | M Wilson ; D Sim |
| Location | Auckland |
| Parties | AFFCO New Zealand Ltd v Graham and Anor |
| Other Parties | Silver Fern Farms Ltd |
| Summary | INJUNCTION – Restraint of Trade – Applicant sought interim injunction to prevent first respondent working for second respondent during three month restraint of trade previously agreed between parties – First respondent made redundant by applicant and turned down relocation offers for family reasons - First respondent accepted employment with second respondent – On familiarisation tour of second respondent’s premises first respondent involved in conversation with representative from company which was also customer of applicant - Applicant claimed first respondent taking job with second respondent and activities in meeting with customer breached obligations in employment agreement because in previous role first respondent had access to and knowledge of information in which applicant had proprietary interest – Authority found on general principles, was real prospect that trade restraint for manager at first respondent’s level would, more likely than not, be found to be reasonable and enforceable for three months provided asserted proprietary interests in respect of information were established at substantive investigation – Found point of contention was whether first respondent in fact, had or was likely to have had, information in which applicant would retain proprietary interest throughout full three months of purported restraint period – Found that could not be determined definitively on affidavit evidence - However, Authority accepted was arguable case that first respondent had access to ‘myriad’ of information about operations and plans of applicant which were of mixed confidential and non-confidential nature and restraint was necessary to protect that portion of information which was truly confidential and in which applicant had legitimate interest in protecting from risk of disclosure whether deliberate, inadvertent or innocent - Authority found balance of convenience favoured applicant - Firstly, found establishing and quantifying loss would not be easy for applicant – Found more just that first respondent be restrained by injunction for balance of restraint period than applicant be required to prove loss and damages in further litigation - Secondly, found first respondent not without resources to see him through restraint period, or without prospects following it - Thirdly, Authority did not accept effect on second respondent, as third party, of not having benefit of applicant’s work for restraint period outweighed potential detriment to applicant - Fourthly, alternatives proposed by first respondent to ‘blanket’ restraint, would not adequately protect applicant from identified potential risk of inadvertent disclosure – Found overall justice favoured applicant – Found applicant lodged application within a few days of situation with first respondent’s new employment becoming clear – Application granted – First respondent restrained from having any involvement in business of second respondent without express prior written consent of applicant until specified date - Operation Manager |
| Result | Application granted ; Costs reserved |
| Main Category | Injunction |
| Statutes | ERA s134 |
| Cases Cited | Allright v Canon New Zealand Ltd unreported, Couch J, 3 Dec 2008, AC 47/08;Green v Transpacific Industries Group (NZ) Ltd [2011] NZEMPC 6;Littlewoods Organisation Limited v Harris [1978] 1 All ER 1026;Television New Zealand v Bradley unreported, Colgan J, 10 Mar 1995, AEC 14/95;Wellington Free Ambulance Service Inc v Adams [2010] NZEMPC 59 |
| Number of Pages | 11 |
| PDF File Link: | 2011_NZERA_Auckland_223.pdf [pdf 36 KB] |