Dreameworks Investments 138 (Pty) Ltd and Another v Brettchneider and Another (10445/2006) [2007] ZAGPHC 354 (23 February 2007)

Dreameworks Investments 138 (Pty) Ltd and Another v Brettchneider and Another (10445/2006) [2007] ZAGPHC 354 (23 February 2007)

The court found that the restraint of trade clause imposed by the applicants was excessively broad in both duration and geographic scope, extending to 36 months and covering the entire country and beyond. There was no convincing evidence that the respondents had lured clients away or caused any direct financial loss to the applicants. The limitations placed on the respondents were deemed too stringent and unfair, hampering free competition and operating to the detriment of the public. The applicants failed to demonstrate a protectable interest that justified such a restraint, and the court concluded that the clause was oppressive and not in the public interest. Accordingly, the...

Citation
[2007] ZAGPHC 354
Parties
Applicant: Dreameworks Investments 138 (Pty) Ltd; Applicant: The Special Holdings (SA) (Pty) Ltd; Respondent: Leanie Brettchneider; Respondent: LB Plaagbeheer CC
Court
High Courts - Gauteng
Jurisdiction
South Africa
Judgment Date
23 February 2007
Case Number
10445/2006
Procedural Posture
Urgent Application / First Instance
Outcome
Application dismissed with costs.
Judges
E M Patel
Legal Topics
Restraint of Trade, Unfair Competition, Franchise Agreement, Public Interest, Contractual Fairness
Commercial and Corporate Restraint of Trade Unfair Competition Franchise Agreement Public Interest Contractual Fairness

Case Brief

Summary, issues, holding and outcome

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Parties

Dreameworks Investments 138 (Pty) Ltd

Applicant

The Special Holdings (SA) (Pty) Ltd

Applicant

Leanie Brettchneider

Respondent

LB Plaagbeheer CC

Respondent

Procedural Posture

Urgent Application / First Instance

Legal Issues

  1. 1 Whether the restraint of trade clause in the agreements is enforceable against the respondents.
  2. 2 Whether the applicants have a protectable interest justifying the restraint.
  3. 3 Whether the duration and geographic scope of the restraint are reasonable and in the public interest.

Ratio Decidendi

The court found that the restraint of trade clause imposed by the applicants was excessively broad in both duration and geographic scope, extending to 36 months and covering the entire country and beyond. There was no convincing evidence that the respondents had lured clients away or caused any direct financial loss to the applicants. The limitations placed on the respondents were deemed too stringent and unfair, hampering free competition and operating to the detriment of the public. The applicants failed to demonstrate a protectable interest that justified such a restraint, and the court concluded that the clause was oppressive and not in the public interest. Accordingly, the...

Court Disposition

Application dismissed with costs.

Orders

  • The application is dismissed with costs.