Berry v Wong [2000] NSWSC 1002

Berry v Wong [2000] NSWSC 1002

The covenant was unenforceable as the goodwill in the practice was held by the plaintiff’s company rather than the plaintiff personally, so the restraint did not protect a legitimate interest of the plaintiff. Estoppel by deed could not apply so as to prevent the court from inquiring into the true owner of the goodwill in the context of public policy on restraint of trade. The change in remuneration did not amount to a rescission or new contract excluding the restraint. Accordingly, the application for enforcement of the restraint was dismissed.

Jurisdiction
Australia
Judgment Date
16 October 2000
Procedural Posture
Civil (equity Division) / Judgment
Outcome
Proceedings dismissed with no order as to costs.
Legal Topics
['restraint of Trade' 'goodwill' 'estoppel by Deed']
['equity' 'trade & Commerce'] ['restraint of Trade' 'goodwill' 'estoppel by Deed']

Case Brief

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Procedural Posture

Civil (equity Division) / Judgment

Legal Issues

  1. 1 ['Is the restraint of trade covenant enforceable when the goodwill is owned by a company, not the plaintiff?' "Does estoppel by deed prevent the defendant from denying the plaintiff's ownership of the goodwill?" 'Did the change in remuneration amount to a rescission and a new contract excluding the restraint?' 'Is the restraint (5 km, 2 years) reasonable in the circumstances?']

Ratio Decidendi

The covenant was unenforceable as the goodwill in the practice was held by the plaintiff’s company rather than the plaintiff personally, so the restraint did not protect a legitimate interest of the plaintiff. Estoppel by deed could not apply so as to prevent the court from inquiring into the true owner of the goodwill in the context of public policy on restraint of trade. The change in remuneration did not amount to a rescission or new contract excluding the restraint. Accordingly, the application for enforcement of the restraint was dismissed.

Court Disposition

Proceedings dismissed with no order as to costs.

Orders

  • ['Proceedings dismissed.' 'No order as to costs.' 'Exhibits are to remain.']