Benchmark Signs Incorporated v Daniel and Another (J1153/16) [2016] ZALCJHB 264 (7 July 2016)

Benchmark Signs Incorporated v Daniel and Another (J1153/16) [2016] ZALCJHB 264 (7 July 2016)

The court found that the restraint of trade clause imposed by the applicant was unreasonable in both its three-year duration and nationwide geographic scope. The applicant failed to lay a proper factual basis for partial enforcement, raising the issue only in reply and without conceding the overbreadth of the restraint. The employee's prior lack of industry experience and the change in the applicant's business model further undermined the justification for such a broad restraint. The pending constructive dismissal dispute before the CCMA was irrelevant to the enforceability of the restraint. The court held that the restraint was unduly repressive and contrary to public policy, and...

Citation
[2016] ZALCJHB 264
Parties
Applicant: Benchmark Signs Incorporated; Respondent: Muller Daniel; Respondent: Seek Group (Proprietary Limited)
Court
Labour Court Johannesburg
Jurisdiction
South Africa
Judgment Date
7 July 2016
Case Number
J1153/16
Procedural Posture
Urgent Application / Judgment
Outcome
Application dismissed with costs.
Judges
Molahlehi
Legal Topics
Restraint of Trade, Confidential Information, Partial Enforcement, Reasonableness of Restriction
Labour Law Commercial and Corporate Restraint of Trade Confidential Information Partial Enforcement Reasonableness of Restriction

Case Brief

Summary, issues, holding and outcome

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Parties

Benchmark Signs Incorporated

Applicant

Muller Daniel

Respondent

Seek Group (Proprietary Limited)

Respondent

Procedural Posture

Urgent Application / Judgment

Legal Issues

  1. 1 Whether the restraint of trade clause is enforceable against the employee.
  2. 2 Whether the restraint is reasonable in terms of duration and geographic scope.
  3. 3 Whether partial enforcement of the restraint is appropriate given the applicant's submissions.

Ratio Decidendi

The court found that the restraint of trade clause imposed by the applicant was unreasonable in both its three-year duration and nationwide geographic scope. The applicant failed to lay a proper factual basis for partial enforcement, raising the issue only in reply and without conceding the overbreadth of the restraint. The employee's prior lack of industry experience and the change in the applicant's business model further undermined the justification for such a broad restraint. The pending constructive dismissal dispute before the CCMA was irrelevant to the enforceability of the restraint. The court held that the restraint was unduly repressive and contrary to public policy, and...

Court Disposition

Application dismissed with costs.

Orders

  • The applicant's application is dismissed with costs.