Himoinsa Southern Africa (Pty) Ltd v Taylor and Another (J873/2021) [2021] ZALCJHB 329 (1 October 2021)
The court found that the restraint of trade and confidentiality undertakings in the employment contract were valid and binding. The respondent's employment with Aggreko, a direct competitor, constituted a breach of the restraint. The respondent had access to confidential information and customer connections, which,...
Source-derived case information.
- Citation
- [2021] ZALCJHB 329
- Parties
- Applicant: Himoinsa Southern Africa (Pty) Ltd; Respondent: Warrick John Taylor; Respondent: Aggreko Energy Rental South Africa (Pty) Ltd
- Court
- Labour Court Johannesburg
- Jurisdiction
- South Africa
- Case Number
- J 873/2021
- Procedural Posture
- Urgent Application / Final Interdict Application on Urgent Roll
- Outcome
- Application granted. The restraint of trade is enforced for six months from 1 August 2021. No order as to costs.
- Judges
- Mahosi
- Legal Topics
- Restraint of Trade, Confidential Information, Employment Contract, Interdict, Protectable Interest
Source-derived case record
Summary, issues, holding and outcome
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Parties
Himoinsa Southern Africa (Pty) Ltd
Applicant
Warrick John Taylor
Respondent
Aggreko Energy Rental South Africa (Pty) Ltd
Respondent
Procedural Posture
Urgent Application / Final Interdict Application on Urgent Roll
Legal Issues
- 1 Whether the restraint of trade and confidentiality undertakings in the employment contract are valid and enforceable.
- 2 Whether the applicant has a protectable interest justifying enforcement of the restraint.
- 3 Whether the respondent's employment with a competitor constitutes a breach of the restraint.
Ratio Decidendi
The court found that the restraint of trade and confidentiality undertakings in the employment contract were valid and binding. The respondent's employment with Aggreko, a direct competitor, constituted a breach of the restraint. The respondent had access to confidential information and customer connections, which, if disclosed or used, would cause irreparable harm to the applicant. The undertakings given by the respondent were insufficient to protect the applicant's interests. Although the urgency was not genuine and the applicant's attorneys were tardy, the court deemed it expedient to resolve the matter on the merits to avoid further delay and waste of resources. The applicant...
Court Disposition
Application granted. The restraint of trade is enforced for six months from 1 August 2021. No order as to costs.
Orders
- The application is treated as urgent and non-compliance with normal time periods, forms, and service is condoned.
- The first respondent is interdicted and prevented for six months from 1 August 2021 from soliciting customers or being employed by a competitor in specified territories.
Full Case Text
Judgment text and source record
133 paragraphs
IN THE LABOUR COURT OF SOUTH AFRICA, JOHANNESBURG
Not Reportable
Case no: J 873/2021
In the matter between:
HIMOINSA SOUTHERN AFRICA (PTY) LTD Applicant
and
WARRICK JOHN TAYLOR First
Respondent
AGGREKO ENERGY RENTAL
SOUTH AFRICA (PTY) LTD Second
Respondent
Heard: 19 August 2021
Delivered: This judgment is handed electronically by circulation to the parties' legal representatives by email and released to the court’s
library. The date for hand-down is deemed to be 01 October 2021.
JUDGMENT
MAHOSI. J
Introduction
[1] This is an application brought on an urgent basis for an order to enforce a restraint of trade agreement and confidentiality undertakings as contained in a written contract of employment concluded between the applicant, Himoinsa Southern Africa (Pty) Ltd (Himoinsa) and the first respondent, Warrick John Taylor (Taylor).
[2] Himoinsa seeks to enforce the restraint for a period of 6 months throughout the Republic of South Africa, Lesotho, Swaziland, Namibia, Botswana, Zambia, Zimbabwe, DRC, Mozambique and Malawi and any other country in which the applicant is conducting or has conducted business or any part thereof.
[3] Taylor is opposing the application, whilst the second respondent, Aggreko Energy Rental South Africa (Pty) Ltd (Aggreko) filed a notice to abide by the decision of the Court.
[4] Prior to outlining Himoinsa’s claims in detail and considering the issues to which they give rise, it is necessary to summarise the relevant facts which form the background to the dispute between the parties.
Background
[5] Himoinsa is part of Himoinsa Spain Limited, a global corporation that designs, manufactures, retails, rents and distributes diesel and gas power generation equipment worldwide.
[6] In line with its parent company, Himoinsa provides diesel, gas generator sets, control panels and paralleling systems for standby emergency power, prime power, continuous power and distributed power. It further provides sales, rentals, maintenance, and technical services of generators and lighting towers to a wide range of users in both the public and private sectors, which includes elemental fleet of generators and balance of plant, providing bespoke manufactured equipment solutions for customers, together with installation, after sales service, operations and maintenance of all sold and rental generation equipment.
[7] On 30 October 2019, Taylor and Himoinsa entered into an employment agreement in terms of which Taylor was appointed as a Senior Sales Engineer. Although the effective date was 01 January 2020, the parties agreed that Taylor was to commence his employment relationship in a consultancy role from 01 October 2019. It is common cause that the restraint of trade undertakings that Himoinsa seeks to enforce are incorporated in the employment agreement entered into between the parties.
[8] On 30 June 2021, Taylor tendered his letter of resignation to Himoinsa’s General Manager, Mr Christopher Davidson and informed him that he intends to accept a position of Key Account Manager: Manufacturing with Aggreko. Taylor served his notice period until 31 August 2021.
[9] On 02 July 2021, Himoinsa’s attorneys addressed a correspondence to both the first and the second respondents in terms of which it demanded that they provide an undertaking by no later than 07 July 2021 that the first respondent would not accept the position with the second respondent, who is its competitor, for a duration of the restraint period of six months.
[10] On 07 July 2021, the first and second respondents’ attorneys responded to the applicant’s demand by addressing a letter in terms of which they refused to provide the undertaking required by the applicant and maintained that the applicant had no protectable interest. In order to avoid litigation and as an indication of the respondents’ good faith, Taylor undertook not to:
‘7.1 employ or offer to employ or encourage or entice or persuade or induce any employee of your client to terminate his/her employment with your client;
7.2 furnish any information or advice to any customers that he engaged with while at your client which is designed to result in any such client termination his/her association with your client;
7.3 supply any know-how and/or technology relating to client, which is allegedly in his possession, to any person;
7.4 solicit and/or tender orders from any customers that he engaged with while at your client;
7.5 become a distributor, licensee, agent or representative or employee of any customers that he engaged with while at your client;
7.6 disclose any alleged confidential information or trade secrets of your clients to any third party, including Aggreko; and
7.7 use or attempt to use any of your client’s confidential information or trade secrets in any manner which may injure or cause loss either directly or indirectly to the client.’[1]
[11] On 15 July 2021, Himoinsa’s attorneys addressed another correspondence to the respondents’ attorneys, in terms of which they demanded that in addition to the undertakings already made, Taylor must undertake to respect the six month restraining period by not pursuing employment with Aggreko until 01 February 2022. However, it appeared from the correspondence from the respondents’ attorneys dated 16 July 2022 that the undertaking sought by Himoinsa was not forthcoming. It was for that reason that Himoinsa brought this application.
[12] Taylor opposed this application on the basis that it was not urgent and/or that the urgency was self-created as well as on merits. The issue of urgency is considered first.
Urgency
[13] Rule 8(2) of the Rules for the Conduct of Proceedings in the Labour Court (the Rules), which governs urgent applications provides as follows:
‘(1) A party that applies for urgent relief must file an application that complies with the requirements of rules 7(1), 7(2), 7(3) and, if applicable, 7(7).
(2) The affidavit in support of the application must also contain-
(a) the reasons for urgency and why urgent relief is necessary;
(b) the reasons why the requirements of the rules were not complied with, if that is the case; and
(c) if a party brings an application in a shorter period than that provided for in terms of section 68(2) of the Act, the party must provide reasons why a shorter period of notice should be permitted.’
[14] In Jiba v Minister of Justice and Constitutional Development and others,[2] this Court considered rule 8 and stated as follows:
‘Rule 8 of the rules of this Court require a party seeking urgent relief to set out the reasons for urgency and why urgent relief is necessary. It is trite law that there are degrees of urgency. And the degree to which the ordinary applicable rules should be relaxed is dependent on the degree of urgency. It is equally trite that an applicant is not entitled to rely on urgency that is self created when seeking a deviation from the rules.’
[15] It is trite that in instances where a party seeks final relief on an urgent basis, such as the applicant in this matter, the bar is raised even higher. As the Court in Tshwaedi v Greater Louis Trichardt Transitional Council[3] stated:
‘… An applicant who comes to court on an urgent basis for final relief bears an even greater burden to establish his right to urgent relief than an applicant who comes to court for interim relief…’
[16] In Mozart Ice Cream Classic Franchises (Pty) Ltd v Davidhoff and another,[4] the Court found that breaches of restraint of trade are inherently urgent. However, applicants in restraint of trade matters cannot use that to their advantage. As was espoused in Ecolab (Pty) Ltd v Thoabala and another,[5] a party that approaches this Court on an urgent basis for an interdict in a restraint of trade “at his leisure” must be denied relief.
[17] In the current matter, although Taylor admits that restraint applications inherently posses a degree of urgency, he also contended that Himoinsa should be denied urgent hearing as the urgency was self-created. To support his contention, Taylor submits that Himoinsa failed to diligently prosecute this application in that although he resigned on 31 June 2021 the founding papers were ready by 20 July 2021, they were only served on him on 4 August 2021 when the stated date on which he was required to file his notice of opposition had already passed.
[18] To make matters worse, Himoinsa neglected to file a formal notice to amend the notice of motion. Instead, Himoinsa’s attorneys simply informed Taylor’s attorneys of a later date for the filing of opposition by email. Clearly, this is irregular and contrary to the rules of this Court.
[19] It is Taylor’s contention that Himoinsa failed to explain the delay in serving the notice of motion between 20 July 2021 and 04 August 2021 in the founding affidavit, but only attempted to do so in the replying affidavit. According to Taylor, Himoinsa’s explanation provides no excuse for the delay as it fails to outline the reason for not serving the application through email as agreed by the parties.
[20] Himoinsa attributes the delay in the filing of this application to the engagement it had with the respondents in attempting to resolve the dispute amicably prior to seeking the intervention of the court. Regarding the delay in serving the founding papers after being finalised on 20 July 2021, Himoinsa attributes the delay to what it says was a bona fide mistake committed by his legal representative in accepting the advice from the Registrar’s office that only original papers were required in order to issue the application, as well as the confusion on the part of the courier company despite clear instruction to deliver to the correspondent instead of the Sheriff’s office in East London.
[21] Having had regard to the parties’ submission, I agree with Taylor that this is definitely ‘litigation at leisure’. The manner in which the Himoinsa’s attorneys conducted this application exhibits tardiness, disregard to the rules of the Court and lack of due haste in bringing this application. This Court must caution Himoinsa’s attorneys that the latitude extended to parties to dispense with the rules of the court in circumstances of urgency is not available to parties who are dilatory to the point where their very inactivity is the cause of the harm on which they rely on to seek relief.
[22] Notwithstanding the fact that this matter is not truly urgent, I am of the view that to struck it off from the urgent roll would burden the expedited motion roll within another month which would be a waste of this Court’s scarce resources. It would, therefore, be expeditious to resolve the matter on its merits. As such, in keeping with the tenets of the Labour Relations Act[6] (LRA), to resolve labour disputes speedily this matter would be heard as one of urgency.
Submissions on merits
[23] Himoinsa contends that the restraint and confidentiality undertakings embodied in Mason’s employment contract were valid and enforceable.
Further that Taylor was in breach of such undertakings as he has been in the employ of Aggreko since August 2021, which is its direct competitor in the energy sector providing diesel and gas generators for standby emergency power by selling and renting their products. It was Himoinsa’s further contention that for every day that Taylor remains in Aggreko’s employ, he would be able to divulge and use its confidential information to assist Aggreko to compete with it and to further exploit its customer connections for the benefit of Aggreko.
[24] In particular, Himoinsa submits that during his employment, Taylor’s discharged, inter alia, the following responsibilities and duties:
24.1 report to the management, and if required, the board, on such matters and furnish such information as the management may from time to time, require;
24.2 implement such directives, powers and procedures, and such manner, as management may require;
24.3 provide timely and accurately financial information to the management for its review and consideration;
24.4 at all times faithfully, promptly and culturally carry out and perform all his duties including such duties as may conform with his position or be it delegated or assigned to him by the management;
24.5 using his best endeavours properly to conduct improve, extend and develop the business;
24.6 attend meetings abroad if and when requested by the management to do so or where required to expand the business elsewhere in the world;
24.7 both during and after termination of his employment, not to disclose to anyone any information whatsoever in regard to Himoinsa, save as required in fulfilling his duties; and
24.8 use the IT system only to conduct Himoinsa’s business and enhance his productivity.
[25] It was Himoinsa’s further submission that during his employment, Taylor was involved with both sales and rental of its products. Accordingly, he identified key customers; educated customers on the technical benefits, pricing points and key differentiators provided by Himoinsa; cold called, scheduled and met with customers; qualified, coated and secured sales and rentals of products and services; serviced existing customers any lead generation from effective prospecting; secured orders and drove after sales and service contracts; managed key account and built long lasting customer relationships; assisted with annual marketing plan and hands-on involvement with events; managed and fostered the existing relationships between Himoinsa and its most valuable and important customers.
[26] According to Himoinsa, Taylor had access to and obtained knowledge regarding detailed customer information including customer contact details, the terms of contractual relationships between Himoinsa and its customers and the specific requirements for each customer; development of its client’s rental rates in contractual terms offered to customers; details of all proposals made to customers; the customer relationship management (CRM) system in plan implemented by Himoinsa and lead generation tools; technical information about Himoinsa’s rental engine specifications; knowledge of the identity of potential
customers being targeted by Himoinsa, and business development plan implemented and/or to be implemented to secure those customers and build lasting relationships with them; project opportunities where Himoinsa is presented competing directly against Aggreko; and other matters we shall need to Himoinsa’s business, and in respect of which information is not readily available in the ordinary course of business to his competitors including Aggreko.
[27] Himoinsa contends that its rental range of products and equipment were designed specifically for rental applications, which was previously bought by Aggreko at which point it was customised for its rental customers and applications.
[28] It was not disputed that after tracking Mr Taylor’s activity on its central server, it came to Himoinsa’s attention that, on 24 May 2021, Mr Taylor accessed information relating to manufacturing sector from Himoinsa’s database regarding information in respect of other sales persons employed by it. Further that Himoinsa introduced Taylor to its customers and so as to establish relationships with them and also expose human, at its expense to customer locations, social events and customer entertainment.
[29] Himoinsa contends that Taylor was being positioned as a senior member of its team with decision-making authority to engage directly with customers and submit commercial terms pressing and technical solutions for both parental and customer sales. Further that he was the main point of contact for all his customers and he did not have mandatory and/or excessive management supervision or involvement. Furthermore, Taylor enjoyed wide latitude when it came to establishing and maintaining customer relations.
[30] It was Himoinsa’s further contention that Taylor was directly involved with contract negotiations with Himoinsa’s Delta Gold and Renergen, both of which are rental contracts which were awarded to it. Further that Taylor was also engaged with contracts relating to tender awarding to Himoinsa as well as unsolicited business which resulted in the conclusion of both sale and rental contracts.
[31] Furthermore, Himoinsa contends that Taylor was involved in many strategic discussions with Himoinsa’s senior management which included the 2021 sales strategy (22 to 25 February 2021), where he was confirmed as Sector Focus Lead for the manufacturing sector and presented the key accounts to target in this sector, a new business model strategic planning workshop (15 April 2021), a new product launch (26 June 2021) and the recently launched customer relationship management system. He was also involved in formulation of pricing structures and for some projects where Himoinsa and Aggreko when in direct competition.
[32] According to Himoinsa, Taylor’s role as of February 2021 was unchanged in that he focused on the manufacturing sector. Himoinsa invested in him by purchasing lead generation and market information tools to assist him to gain insight into the manufacturing sector. As recently as May this year, Taylor concluded a tender for work on behalf of Himoinsa in the manufacturing sector against Aggreko, more particularly rental opportunity with Ford.
[33] In opposing, Taylor disputes that Himoinsa has any proprietary interests deserving of protection or that his employment with Aggreko poses no threat to its protectable interest.
[34] Taylor further contends that although Himoinsa and Aggreko operate within the generation industry, Aggreko’s main business is the rental supply generation, whilst Himoinsa focusses on the sale of generators with its rental business generating a small portion of its overall revenue. Furthermore, Taylor contends that the restraint is unreasonable and should not be enforced for the following reasons because it is both generic and wide.
[35] Taylor contends that, during his short stint at Himoinsa, he was exposed to a limited extent to its confidential information. Taylor submits that he attended general strategic meetings which included details of sales rentals but which did not disclose confidential information which would jeopadise Himoinsa’s business should it come to Aggreko’s attention. Further that he never attended meetings at senior management or board level and did not take executive decisions.
[36] Taylor further contends that, as a Senior Sales Engineer, he had little influence on or knowledge of formulation of Himoinsa’s pricing structure. Whilst he had very limited scope to negotiate the sale price that Himoinsa would charge its various customers, the parameters for negotiations is set by Himoinsa’s Global Quoting Portal called “Red” and the costing of the retail price is determined by Himoinsa’s Head Office in Spain.
[37] Furthermore, Taylor contends that he had not memorised Himoinsa’s pricing information and had no documentation in relation thereto. Taylor argued that whatever pricing information he may have had would be of no value as prices were adjusted every three months in line with the supplier increases and the exchange rate.
[38] In respect of rental pricing, Taylor contends that Himoinsa had a locked Microsoft Excel spreadsheet, certain fields of which could be altered for the purpose of calculating the final price for the client and that the formulae used in the calculation of the rental price were neither accessible nor known to him. Accordingly, Taylor argued that he did not know the true rental cost structure of Himoinsa or how various factors influence it.
[39] Taylor further contends that the placing of the distributor agreement of Himoinsa was never under his control; Aggreko would obtain no unfair competitive advantage in employing him and Himoinsa has no protectable interest; Aggreko was not an original equipment manufacturer (OEM); there was nothing unique about Himoinsa’s customer needs; Himoinsa and Aggreko shared customers; customers’ needs depended on the industry that the customer operates in; the “lead generation and marketing information tools” Himoinsa referred to were generic and generally available tools available to all internet advertisers and not specific to any sector; and Himoinsa could not in law prevent him from utilising skills and competencies he acquired through experience.
[40] Taylor further contends that whatever confidential information he had relating to Himoinsa was of limited lifespan and that Himoinsa would have lost whatever protectable interest it may have had in that information. Furthermore, Taylor contended that the undertakings which he had given cure any prejudice which Himoinsa may suffer.
Applicable law and analysis
[41] It is trite that in order for a restraint covenant to be enforced by way of a final interdict, an employer has to show that there is a valid restraint of trade agreement, that the same has been breached or there is a reasonable apprehension that same will be breached, and that the employer will suffer irreparable harm. In turn, the respondent who seeks to avoid the restraint bears an onus to demonstrate, on a balance of probabilities, that the restraint agreement is either invalid or unenforceable because it is unreasonable and/or against constitutional values and public policy.[7]
[42] In the current matter, it is not in dispute that there is a valid restraint of trade clause. To an extent that Taylor neither raises any concerns with regards to the employment contract nor make any allegation of there being an element of duress or a misunderstanding when signing the contact, the only reasonable conclusion that could be drawn is that the employment contract is binding on both parties.
[43] In light of the fact that it is established that there is a valid restraint of trade agreement, Himoinsa has the onus to show that
there has been a breach. Once a breach is shown to exist, then the onus shifts to the respondent to show that the restraint of trade covenant is unreasonable and unenforceable.[8]
[44] Himoinsa’ case is underpinned by the fact that Taylor took employment with its competitor. In this regard, Himoinsa contends that Taylor’s taking up employment with Aggreko is in direct contravention of the restraint of trade covenant as it provides that for a period of six months after the termination of his employment with Himoinsa, Taylor undertakes that he will not be employed by any person or entity within the defined territories which carries on the same or similar business to the business carried on by Himoinsa.
[45] Taylor’s contention, in this regard, is that the restraint was unreasonable and that it should not be enforced. Further that Aggreko and Himoinsa were only competitors in respect of rental of generators, a relatively small portion of the Himoinsa’s local business. Unfortunately for Taylor, this does not take anything away from the fact that Himoinsa offers products for both the sale and rental segments within the electricity generation industry or that it focuses on one segment to the exclusion of the other. Further, it is not disputed that Himoinsa employs dedicated service team made up of South African nationals. There is therefore no merit to Taylor’s defense in this regard.
[46] The argument that there was no breach of restraint as clause 5 prohibits the rendering of services that are competitive to the prescribed services to the competitor and not the taking up of employment with the competitor was only raised for the first time by Taylor’s legal representative in the heads of arguments and not foreshadowed in the pleadings. For that reason, it is considered.
[47] Himoinsa further contends that it has protectable interest in the form of confidential information and customer connections to which Taylor had access and which if disclosed to Aggreko would be detrimental and further cause irreparable harm to its business. Taylor contends that the undertakings already provided adequately protect any supposed confidential information or proprietary interest, which Himoinsa seeks to protect. I agree with Himoinsa that Taylor’s undertakings are cold comfort to it, as they provide no protection against the unfair advantage that Aggreko would derive and enjoy by having Taylor in its employ. The undertakings amounts to cherry picking and further falls short of respecting the terms of the restraint.
[48] Regarding Taylor’s contention that his knowledge of Himoinsa’s confidential information has a limited lifespan, Himoinsa submitted that many of its contracts were long and often extended. Further that two of such contracts which were awarded to Himoinsa and in which Taylor was involved in had Aggreko as a competing bidder. These contracts are Renergen contract for 8 months and Delta contract for 4 years. It is Himoinsa’s contention that if its competitors such as Aggreko were to know at what price those contracts were awarded to it and the commercial terms relating to those contracts, they would gain an unfair advantage in the marketplace to outbid it for similar types of contracts and it could be displaced as a preferred supplier and may also be at risk of not securing any possible future extensions of existing contracts.
[49] Himoinsa further contends that Taylor worked directly with its major short-term customers such as Dimension Data, GL events and Huawei. In this regard, Himoinsa contends that if its competitors were to know what rental units it offers in terms of short term contracts, they would gain a technical advantage in terms of size of the generator units, capacity, remote monitoring, synchronise requirements as well as the commercial advantages relating to pricing, contractual terms and payment terms.
[50] Regarding pricing, Himoinsa contends that Taylor is aware and privy to two rental pricing templates. The one is a locked spread sheet which he refers to and the other that he omits to mention is the project financial model template, the development of which he was directly involved in. Himoinsa contends that the latter is unique as it was developed internally, very detailed, used for both sales and rentals and was used by Taylor to acquire knowledge of and access to its confidential information relating to costing structure, profit margins and the like.
[51] In addition, it is not in dispute that on 24 May 2021 while he was still employed, which was 28 business days prior to serving his resignation letter, Taylor accessed information relating the manufacturing sector from Himoinsa’s database regarding information in respect of other salespersons employed by it. The explanation proffered by Himoinsa for his conduct was that he was gathering as much information as he could to benefit him in his position which he was to take up with Aggreko and for Aggreko.
[52] From the above, it is apparent that Taylor has confidential knowledge relating to Himoinsa’s sales and rental products, its pricing and customer connections and is therefore in a position to act to the detriment of Himoinsa.
[53] There is no merit to Taylor’s argument that to an extent that the primary threat that he poses is in relation to its customers, both in relation to customer connection and confidential information, Himoinsa’s interest does not require protection by way of a restraint against him because the threat is mitigated by the fact that many of Himoinsa’s rental contracts are for a long term and often extended and their terms exceed the terms of the restraint sought to be imposed. As such, Himoinsa has established that it has a clear right that it seeks to protect.
Irreparable harm and lack of alternative remedy
[54] To an extent that Himoinsa has established that it has a clear right, the Court needs to determine whether it will suffer irreparable harm and whether there is an appropriate alternative remedy but for the interdictory relief sought. Steenkamp J, stated the following in his judgment of Continuous Oxygen Suppliers (Pty) Ltd t/a Vital Aire v Meintjies and another[9]:
‘[49] I have come to the conclusion that the restraint of trade agreement is enforceable and that the applicant has interest’s worthy of protecting. It is axiomatic that the applicant will suffer irreparable harm if it is not enforced. The potential harm caused by an employee who is in a position to divulge trade secrets to and exploit customer connections in favour of her new employer cannot be easily remedied by a damages claim in due course.
[50] … The obvious alternative remedy of a damages claim is cold comfort to an applicant that seeks to enforce a legitimate restraint of trade covenant. By the time a damages claim is likely to be heard, the horse would have bolted and the harm would have been done. That harm is very difficult to repair.’
[55] In light of the above authority, it is my view that Himoinsa has shown that it has a protectable interest, which if not enforced will cause irreparable harm to its business. Further, Himoinsa should not be denied urgent relief because it has an alternative remedy in due course, because such a remedy will be cold comfort.
Costs
[56] The Labour Appeal Court in Ball v Bambelela Bolts (Pty) Ltd[10] found that since these matters raise a constitutional issue, the rule of costs following the results does not apply. Therefore, the appropriate order to make is that of each party paying its own costs.
[57] Accordingly, the following order is made:
Order
1. This application is treated as one of urgency as provided for in terms of Labour Court Rule 8 and the applicant’s failure to comply with the normal time periods, forms and services are hereby condoned.
2. The first respondent is interdicted and prevented for a period of 6 months from 01 August 2021 from:
2.1 approaching, advising or contacting any person in order to, either directly or indirectly, solicit the custom of person or entity who was the customer with whom or to whom, on behalf of the applicant, negotiations, discussions, order, representations were entered into or made during the period of the first respondent employment with the applicant; and
2.2 being employed either directly or indirectly by or have an interest in either as an employee, principal agent, member, shareholder, director, partner, consultant, financier or advisor or in any other like capacity, in any consent or entity which carries on the same business or at a business substantially similar or like the business of the applicant in South Africa, Lesotho, Swaziland, Namibia, Botswana, Zambia, Zimbabwe, DRC, Mozambique and Malawi and any other country in which the applicant is conducting or has conducted business or any part thereof, in one year preceding 30 June 2021 where Himoinsa conducts its business.
3. There is no order as to costs.
D. Mahosi
Judge of the Labour Court of South Africa
Appearances:
For the applicant: Advocate
GJ Gajjar
Instructed by: Le
Roux Incorporated Attorneys
For the first respondent: Advocate HM Viljoen
Instructed by: Cowan-Harper-Madikizela
Attorneys
[1] Index, p 67 para 7.
[2] (2010) 31 ILJ 112 (LC) at para 18.
[3] [2000] 4 BLLR 469 (LC) at para 11.
[4] 2009 (3) SA 78 (C).
[5] (2017) 38 ILJ 2741 (LC).
[6] Act 66 of 1995 as amended.
[7] See: Basson v Chilwan and others [1993] ZASCA 61; 1993 (3) SA 742 (AD); Magna Alloys and Research SA (Pty) Ltd v Ellis [1984] ZASCA 116; [1984] 2 ALL SA 583 (A).
[8] See: John Saner SC, Agreements in Restraint of Trade in South African law (Lexis Nexis) at 5-8.
[9] (J 2073/11) [2011] ZALCJHB 150 (17 October 2011) at paras 49 and 50.
[10] [2013] 9 BLLR 843 (LAC).