RBM Plastic Extrusions Pty Ltd v Diaz [2006] NSWSC 1332

RBM Plastic Extrusions Pty Ltd v Diaz [2006] NSWSC 1332

Each of the three disputed customers dealt with the plaintiff during the defendant's employment and are within the contractual restraint. The employer has a legitimate interest in protecting customer connection. The duration of a restraint based on customer connection should not be longer than the period of employment in the case of short employment. Relief beyond three months is not justified since the advantage conferred by employment is not shown to last longer. Interlocutory injunction granted for three months restraining the defendant from soliciting customers.

Parties
Plaintiff: RBM Plastic Extrusions Pty Ltd; Defendant: Daniel Diaz
Jurisdiction
Australia
Judgment Date
22 September 2006
Procedural Posture
Interlocutory Application / Decision on Interlocutory Injunction
Outcome
Interlocutory injunction granted restraining solicitation for three months; costs of the interlocutory application to be plaintiff's costs in the cause; directions for further conduct of proceedings given.
Legal Topics
Restraint of Trade, Employer and Employee, Interlocutory Injunction, Confidential Information, Customer Connection, Duty of Fidelity
Equity Restraint of Trade Employer and Employee Interlocutory Injunction Confidential Information Customer Connection Duty of Fidelity

Case Brief

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Parties

RBM Plastic Extrusions Pty Ltd

Plaintiff

Daniel Diaz

Defendant

Procedural Posture

Interlocutory Application / Decision on Interlocutory Injunction

Legal Issues

  1. 1 Whether the contractual restraint extends to the three disputed customers
  2. 2 Whether the restraint is reasonable in scope and duration
  3. 3 Whether interlocutory injunction is appropriate and for what period

Ratio Decidendi

Each of the three disputed customers dealt with the plaintiff during the defendant's employment and are within the contractual restraint. The employer has a legitimate interest in protecting customer connection. The duration of a restraint based on customer connection should not be longer than the period of employment in the case of short employment. Relief beyond three months is not justified since the advantage conferred by employment is not shown to last longer. Interlocutory injunction granted for three months restraining the defendant from soliciting customers.

Court Disposition

Interlocutory injunction granted restraining solicitation for three months; costs of the interlocutory application to be plaintiff's costs in the cause; directions for further conduct of proceedings given.

Orders

  • Defendant restrained until 22 December 2006 or earlier further order from soliciting, canvassing, interfering with or enticing away customers dealt with during employment for three months.
  • Costs of interlocutory application to be plaintiff's costs in the cause.