RajLaw NSW Pty Ltd v RajLaw Pty Ltd [2013] NSWSC 1621

RajLaw NSW Pty Ltd v RajLaw Pty Ltd [2013] NSWSC 1621

Because the first and second defendants were restrained under the contract from carrying on legal business in New South Wales for 7 years, and because there was an arguable case that Arrow Law Pty Ltd was formed to circumvent that restraint and induced the first defendant to breach its contract with the plaintiff, there was a serious question to be tried. The balance of convenience favoured an interlocutory order restraining Arrow from carrying on legal practice in New South Wales, but not the broader restraints sought.

Jurisdiction
Australia
Judgment Date
06 November 2013
Procedural Posture
Interlocutory Application for Injunctions Concerning Restraint of Trade, Inducing Breach of Contract and Australian Consumer Law Claims / Interlocutory Hearing
Outcome
Injunction made in limited terms; balance of interlocutory claims dismissed; costs of the Notice of Motion to be determined by the trial Judge; directions made for pleadings and expedited hearing application.
Legal Topics
['restraint of Trade' 'sale of Legal Business' 'territorial Restraint' 'inducing Breach of Contract' 'interlocutory Injunctions' 'whether Injunction Should Issue Against Company Not a Party to Contract']
['contracts' 'torts' 'equity' 'remedies' 'australian Consumer Law'] ['restraint of Trade' 'sale of Legal Business' 'territorial Restraint' 'inducing Breach of Contract' 'interlocutory Injunctions' 'whether Injunction Should Issue Against Company Not a Party to Contract']

Case Brief

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Procedural Posture

Interlocutory Application for Injunctions Concerning Restraint of Trade, Inducing Breach of Contract and Australian Consumer Law Claims / Interlocutory Hearing

Legal Issues

  1. 1 ['Whether there was a serious question to be tried that Arrow Law Pty Ltd induced breach of the contract between the plaintiff and the first defendant.' 'Whether Arrow Law Pty Ltd was formed as a sham for the purpose of enabling the first and second defendants to evade their obligations under the contract.' 'Whether the balance of convenience favoured interlocutory restraint of Arrow Law Pty Ltd from carrying on legal business in New South Wales.' 'Whether the plaintiff should obtain broader interlocutory restraints against the defendants, including restraints on legal practice outside New South Wales and on work for clients domiciled in New South Wales or work expected to be carried out in New South Wales.' 'Whether relief should be granted under section 18 of Schedule 2 to the Competition and Consumer Act 2010 (Cth) and sections 232/234 of the Australian Consumer Law.']

Ratio Decidendi

Because the first and second defendants were restrained under the contract from carrying on legal business in New South Wales for 7 years, and because there was an arguable case that Arrow Law Pty Ltd was formed to circumvent that restraint and induced the first defendant to breach its contract with the plaintiff, there was a serious question to be tried. The balance of convenience favoured an interlocutory order restraining Arrow from carrying on legal practice in New South Wales, but not the broader restraints sought.

Court Disposition

Injunction made in limited terms; balance of interlocutory claims dismissed; costs of the Notice of Motion to be determined by the trial Judge; directions made for pleadings and expedited hearing application.

Orders

  • ['Upon the plaintiff through its counsel giving the usual undertaking as to damages, order up until the final determination of the action or any prior order the third defendant be restrained from carrying on or being engaged in legal practice in New South Wales.' 'Costs of the Notice of Motion be determined by the...