ADT Security (Pty) Ltd v Botha and Others (13217/2010) [2010] ZAWCHC 563 (18 November 2010)

ADT Security (Pty) Ltd v Botha and Others (13217/2010) [2010] ZAWCHC 563 (18 November 2010)

The court found that the first, second, and fourth respondents were bound by restraint of trade and non-solicitation covenants in favour of the applicant, either directly or by virtue of their conduct and abuse of corporate personality. The applicant's customer lists and connections constituted confidential information and protectable proprietary interests. The respondents' use of new corporate entities to continue competing with the applicant and solicit its customers was a dishonest device to evade contractual obligations. The respondents failed to discharge the onus of showing that the restraints were unreasonable or contrary to public policy. The court held that the applicant was...

Citation
[2010] ZAWCHC 563
Parties
Applicant: ADT Security (Pty) Limited; Respondent: Anton Johan Botha; Respondent: Willem Jacobus Bosman; Respondent: Marger Lamont Security CC; Respondent: Jazz Spirit 1100 CC t/a Blue Bay Guards and Security Solutions
Court
Western Cape High Court, Cape Town
Jurisdiction
South Africa
Judgment Date
18 November 2010
Case Number
13217/2010
Procedural Posture
Final Interdict Application / Final Relief Following Interim Interdict
Outcome
Final interdict granted in favour of the applicant; costs awarded against first, second, and fourth respondents jointly and severally.
Judges
A.G. Binns-Ward
Legal Topics
Restraint of Trade, Enforcement of Contractual Obligations, Piercing Corporate Veil, Confidential Information, Interdictory Relief
Commercial and Corporate Civil Procedure Restraint of Trade Enforcement of Contractual Obligations Piercing Corporate Veil Confidential Information Interdictory Relief

Case Brief

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Parties

ADT Security (Pty) Limited

Applicant

Anton Johan Botha

Respondent

Willem Jacobus Bosman

Respondent

Marger Lamont Security CC

Respondent

Jazz Spirit 1100 CC t/a Blue Bay Guards and Security Solutions

Respondent

Procedural Posture

Final Interdict Application / Final Relief Following Interim Interdict

Legal Issues

  1. 1 Whether the respondents breached restraint of trade and non-solicitation covenants in favour of the applicant.
  2. 2 Whether the applicant has protectable proprietary interests justifying enforcement of the restraints.
  3. 3 Whether the use of corporate vehicles by respondents constitutes an abuse of corporate personality warranting piercing the corporate veil.

Ratio Decidendi

The court found that the first, second, and fourth respondents were bound by restraint of trade and non-solicitation covenants in favour of the applicant, either directly or by virtue of their conduct and abuse of corporate personality. The applicant's customer lists and connections constituted confidential information and protectable proprietary interests. The respondents' use of new corporate entities to continue competing with the applicant and solicit its customers was a dishonest device to evade contractual obligations. The respondents failed to discharge the onus of showing that the restraints were unreasonable or contrary to public policy. The court held that the applicant was...

Court Disposition

Final interdict granted in favour of the applicant; costs awarded against first, second, and fourth respondents jointly and severally.

Orders

  • Interdicting and restraining the first, second, and fourth respondents, for a period of 12 months from 1 May 2010, from soliciting, contacting, or persuading any of the applicant's customers listed in annexure FA6A to terminate their contractual relationship with the applicant.
  • Directing the first, second, and fourth respondents, jointly and severally, the one paying the others being absolved, to pay the applicant's costs of suit, including the costs of the hearings on 23 June 2010 and 27 July 2010.