Spence’s Coaches Western Pty Ltd v McMahon [2021] NSWSC 786

Spence’s Coaches Western Pty Ltd v McMahon [2021] NSWSC 786

There is a serious question to be tried as to the breach of the restraint clause and whether any event of default under the Vendor Finance Agreement terminated that restraint. However, the undertaking offered by the defendant is sufficient to protect the plaintiff's interests pending the final hearing, and the scope of injunctive relief sought is too broad; accordingly, injunctive relief is refused.

Parties
Plaintiff: Spence's Coaches Western Pty Ltd; Defendant: Charles John McMahon
Jurisdiction
Australia
Judgment Date
23 June 2021
Procedural Posture
Application for Interlocutory Injunction / Interlocutory Stage
Outcome
Application for interlocutory injunctive relief refused; defendant's undertakings accepted.
Legal Topics
Restraint of Trade, Sale of Business, Enforcement of Restraint Clauses, Injunctions
Equity Commercial Law Restraint of Trade Sale of Business Enforcement of Restraint Clauses Injunctions

Case Brief

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Parties

Spence's Coaches Western Pty Ltd

Plaintiff

Charles John McMahon

Defendant

Procedural Posture

Application for Interlocutory Injunction / Interlocutory Stage

Legal Issues

  1. 1 Whether there is a serious question to be tried regarding breach of restraint clause
  2. 2 Whether event of default under the Vendor Finance Agreement terminated the restraint
  3. 3 Adequacy of damages as a remedy

Ratio Decidendi

There is a serious question to be tried as to the breach of the restraint clause and whether any event of default under the Vendor Finance Agreement terminated that restraint. However, the undertaking offered by the defendant is sufficient to protect the plaintiff's interests pending the final hearing, and the scope of injunctive relief sought is too broad; accordingly, injunctive relief is refused.

Court Disposition

Application for interlocutory injunctive relief refused; defendant's undertakings accepted.

Orders

  • Defendant undertakes to resign as director of McRowe Pty Ltd and not consent to reappointment before final hearing; to not be involved in McRowe Pty Ltd save for mechanical repairs, servicing and maintenance on vehicles until final hearing or 30 November 2022, whichever is earlier.
  • Refused application for injunctive relief.