Raine & Horne Pty Limited v Adacol Pty Limited & Ors [2006] NSWSC 36

Raine & Horne Pty Limited v Adacol Pty Limited & Ors [2006] NSWSC 36

The plaintiff established a strong case for the enforceability of the restraint of trade clause; the restraint was not shown to be void on public policy grounds nor unreasonably wide; damages would not be an adequate remedy due to the difficulty of quantifying loss from competition in the same area; and the balance of convenience favoured injunctive relief. Therefore, injunctions in terms of the plaintiff's notice of motion should be granted, conditional on undertakings as to damages and communication arrangements.

Parties
Plaintiff: Raine & Horne Pty Limited; First Defendant: Adacol Pty Limited; Second Defendant: Mr Colin Shade; Third Defendant: Mr Adam Wylie
Jurisdiction
Australia
Judgment Date
12 January 2006
Procedural Posture
Application for Interlocutory Injunction / Interlocutory
Outcome
Interlocutory injunctive relief granted
Legal Topics
Restraint of Trade, Franchise Agreements, Injunctive Relief, Public Policy, Adequacy of Damages, Balance of Convenience
Equity Contract Law Restraint of Trade Franchise Agreements Injunctive Relief Public Policy Adequacy of Damages Balance of Convenience

Case Brief

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Parties

Raine & Horne Pty Limited

Plaintiff

Adacol Pty Limited

First Defendant

Mr Colin Shade

Second Defendant

Mr Adam Wylie

Third Defendant

Procedural Posture

Application for Interlocutory Injunction / Interlocutory

Legal Issues

  1. 1 Whether interlocutory injunctive relief should be granted to enforce certain termination provisions and a restraint of trade clause in a franchise agreement
  2. 2 Whether the restraint in clause 29.1 is void on public policy grounds
  3. 3 Whether the restraint is no wider than necessary to protect the plaintiff's legitimate interests

Ratio Decidendi

The plaintiff established a strong case for the enforceability of the restraint of trade clause; the restraint was not shown to be void on public policy grounds nor unreasonably wide; damages would not be an adequate remedy due to the difficulty of quantifying loss from competition in the same area; and the balance of convenience favoured injunctive relief. Therefore, injunctions in terms of the plaintiff's notice of motion should be granted, conditional on undertakings as to damages and communication arrangements.

Court Disposition

Interlocutory injunctive relief granted

Orders

  • Orders in terms of prayers 1, 2, 6, 7, 13 and 14 of the plaintiff's notice of motion.
  • Orders are conditional upon plaintiff giving usual undertakings as to damages and, regarding telephone/facsimile service, an acceptable undertaking as to handling calls.