[2007] KEHC 696 (KLR)

REPUBLIC OF KENYA IN THE HIGH COURT OF KENYA AT NAIROBI (NAIROBI LAW COURTS)

Civil Case 329 of 2007

STEEL STRUCTURES LIMITED ...............................PLAINTIFF

V E R S U S

1. DAVID ENGINEERING LTD

2. DAVID NJOROGE MUIRURI ...........................DEFENDANTS

R U L I N G

The Plaintiff herein, by its plaint dated 11th April, 2007, has sought the following main reliefs from the Defendants, jointly and severally:-

(a) General damages.

(b) Special damages.

(c) A permanent injunction to restrain the 1st Defendant form “inducing and/or procuring the Plaintiff’s employees to breach their employment contracts”.

(d) An injunction to restrain the 2nd Defendant from working for the 1st Defendant and/or any other party which is engaged in business that is in competition with the Plaintiff’s business.

(e) .............

(f) .............

Together with the plaint the Plaintiff filed an application by chamber summons dated 11th April, 2007 seeking the following main orders:-

1. (a)......

(b)......

(c).......

(d) A temporary injunction to restrain the 2nd Defendant from taking up employment with the 1st Defendant or any other individual, company or organisation that is engaged in competitive business with the Plaintiff “in violation of the contract dated 28th February 2006” pending hearing and determination of the suit.

(e).....

(f)......

2. A mandatory injunction against the 1st Defendant to “forthwith cease engaging the 2nd Defendant and to forthwith release (him) to the 2nd Defendant”.

3. A temporary injunction to restrain the 1st Defendant from “enticing, inducing and/or prodding the employees of the Plaintiff to breach their contracts of employment”, presumably pending disposal of the suit.

The application is essentially brought under Order 39, rules 1, 2 and 3 of the Civil Procedure Rules (the Rules) and under section 3A of the Civil Procedure Act (the Act). It is premised upon grounds (stated on the face thereof) that the Plaintiff has entered into contracts with its employees to train them, at great expense, specifically on its operations, and that as a term of these contracts there is a restrictive agreement with the employees for a particular period not to seek employment with a competitor; that the 1st Defendant has targeted these specially trained employees for purpose of their breaching their contracts with the aim of paralyzing the Plaintiff’s operations; that the 2nd Defendant has breached his contract with the Plaintiff; and that the Plaintiff has the right, under its contract with the 2nd Defendant, to restrict him from offering the same services to the 1st Defendant.

There is a supporting affidavit sworn by one FRANCIS KABIRU NJENGA, the human resources manager of the Plaintiff. There is a further affidavit sworn by the same person in response to the Defendants’ replying affidavits.

The Defendants’ two replying affidavits were filed on 30th April, 2007. There is a supplementary affidavit of the 1st Defendant filed on 14th June, 2007. The grounds of opposition emerging from these three affidavits are, inter alia:-

1. That the 1st Defendant never solicited the services of the 2nd Defendant. He was employed on a competitive basis from the open market.

2. That the 1st Defendant never induced any of the Plaintiff’s employees from their employment; those that were employed by the 1st Defendant were so employed on a competitive basis on diverse dates whenever a vacancy arose.

3. That the 1st Defendant is not, and has never been, privy to the contract of employment between the Plaintiff and the 2nd Defendant, and the suit against it is therefore frivolous, vexatious and scandalous.

4. That at the time the suit was filed the 2nd Defendant was already employed by the 1st Defendant; an order to restrain the 1st Defendant from employing the 2nd Defendant would thus be in vain.

5. That there is nothing wrong in law for the 1st Defendant to engage in any lawful business that has competitors; this suit is meant to stifle healthy and lawful business competition.

6. That the 2nd Defendant lawfully terminated his employment with the Plaintiff.

7. That the contract in restraint of trade between the Plaintiff and the 2nd Defendant was unreasonable, against public policy and an infringement of the 2nd Defendant’s personal liberties.

8. That in any event any damages that the Plaintiff may suffer can be ascertained.

The arguments of the learned counsels were along the above-stated positions taken by their respective clients. I have considered those arguments, along with the authorities cited by them.

The restraining temporary injunctions are of course sought under Order 39, rules 1, 2 and 3 of the Rules while the mandatory temporary injunction is sought under the inherent powers of the court. It is now well-settled that an applicant for temporary injunction must demonstrate a prima facie case with a probability of success. He must also show that he stands to suffer irreparable loss unless the order sought is granted. For a mandatory temporary injunction, it is also now well-settled, the applicant must further demonstrate that there are special circumstances warranting the grant of interlocutory mandatory injunction. Special circumstances will depend on the facts of each case. Interlocutory mandatory injunction will be granted only in the clearest of cases.

Temporary restraining injunction is sought against the 1st Defendant to restrain it, pending disposal of the suit, from “enticing, inducing and/or prodding the employees of the Plaintiff to breach their contracts of employment”. To begin with, the 1st Defendant is not privy to the contracts of employment between the Plaintiff and any of its employees. No evidence has been placed before the court tending to show that the 1st Defendant has “enticed, induced, and/or prodded” any of the Plaintiff’s employees to breach their contracts of employment. The fact, per se, that the 1st Defendant has employed, at various times, former employees of the Plaintiff, including the 2nd Defendant, is not necessarily such evidence. The 2nd Defendant was employed by the 1st Defendant by letter of appointment dated 8th December, 2006, the employment to take effect on 15th January, 2007. It appears that the 2nd Defendant had left the Plaintiff’s employment on 30th June, 2006, that is six (6) months before. That is not consistent with the 1st Defendant having “enticed, induced, or prodded” him to leave the Plaintiff’s employment. The 1st Defendant says that it recruited the 2nd Defendant and other former employees of the Plaintiff from a competitive open market favouring employers. There is nothing before the court to indicate otherwise. I am not satisfied, upon the material now before the court, that the Plaintiff has demonstrated against the 1st Defendant a prima facie case with a probability of success.

The Plaintiff has contended that as a consequence of the 1st Defendant’s actions and the 2nd Defendant joining employment of the 1st Defendant, the 1st Defendant has infringed the Plaintiff’s proprietary right to a certain industrial design. But, that alleged infringement is the subject of a separate suit, Milimani HCCC No. 189 of 2007. In the present suit it has not been demonstrated what irreparable loss the Plaintiff might suffer.

A mandatory temporary injunction is also sought against the 1st Defendant to forthwith cease engaging the 2nd Defendant and to forthwith release to the Plaintiff the 2nd Defendant. In other words, the Plaintiff seeks a temporary order to compel the 1st Defendant to terminate the 2nd Defendant’s employment with it. Are there any special circumstances to warrant this obviously drastic course of action? I think not. As already seen, the 1st Defendant employed the 2nd Defendant six months after the latter had terminated his employment with the Plaintiff. It appears that in terminating that employment the 2nd Defendant acted in accordance with the contract between him and the Plaintiff. There is now, obviously, a binding contract of employment between the 1st and 2nd Defendants. Is it desirable and in the interests of justice that the same be terminated at this interlocutory stage? I think not. As a general rule, it is against public policy for any employee to be restricted from seeking greener pastures. Contracts in restraint of trade are, as a general rule, against public policy. That is, however, not to say that they are all necessarily illegal. Section 2 of the Contracts in Restraint of Trade Act, Cap. 24, provides in the material part:-

“2. Any agreement or contract which contains a provision or covenant whereby a party thereto is restrained from exercising any lawful profession, trade, business or occupation shall not be void only on the ground that the provision or covenant is therein contained:-

Provided that:-

(i)the High Court shall have power to declare the provision or covenant to be void where the court is satisfied that, having regard to the nature of the profession, trade, business or occupation concerned, and the period of time and the area within which it is expressed to apply, and to all the circumstances of the case, the provision or covenant is not reasonable either in the interests of the parties, in as much as it affords more than adequate protection of the party in whose favour it is imposed against something against which he is entitled to be protected, or in the interests of the public, inasmuch as the provision or covenant is injurious to the public interest”.

It would not be desirable to make any such declaration at this interlocutory stage. It will suffice to say that, upon the material now before the court, it would not be in the interests of justice to compel the 1st Defendant to terminate the 2nd Defendant’s employment.

The second limb of the prayer for temporary mandatory injunction against the 1st Defendant is for the 1st Defendant to forthwith release the 2nd Defendant to the Plaintiff. In this day and age, I do not see how the 1st Defendant can be compelled to release to the Plaintiff the 2nd Defendant, an adult of sound mind and therefore a free agent enjoying certain fundamental rights under the Constitution, or how such an order can be enforced. If the order sought is meant to compel the 2nd Defendant to return to the Plaintiff’s employment, granting such an order would raise certain serious issues, including the issue of servitude.

After considering all matters placed before the court, I would dismiss the application as against the 1st Defendant. What about the 2nd Defendant? A temporary injunction is sought to restrain him from taking up employment with the 1st Defendant or any other individual, company or organisation that is engaged in competitive business with the Plaintiff in violation of the contract between him and the Plaintiff. As far as employment with the 1st Defendant is concerned, it is a fait accompli. The 2nd Defendant took up that employment on 15th January, 2007, about three months before the suit and application were filed. The court cannot restrain that which has already been done. What about employment with other individuals, companies or organisations? On account of the comments I have already made regarding the 2nd Defendant’s right to seek greener pastures and the undesirability of holding him to employment with the Plaintiff, I would not grant this temporary injunction. Besides, it appears to me that the Plaintiff’s main complaint is that the 2nd Defendant has moved over to the 1st Defendant with the Plaintiff’s industrial secrets. That issue is already the subject-matter of the other suit already mentioned. Whatever loss the Plaintiff may have suffered thereby will be taken care of in that suit.

In the circumstances, and for the reasons appearing above, I must refuse the Plaintiff’s application by chamber summons dated 11th April, 2007. It is hereby dismissed with costs to the Defendants. It is so ordered.

DATED AT NAIROBI THIS 13TH DAY OF DECEMBER, 2007

H. P. G. WAWERU

J U D G E

DELIVERED THIS 14TH DAY OF DECEMBER, 2007