Mars Consumer Products Africa (Pty) Ltd v Smith and Another (J967/23) [2023] ZALCJHB 281 (6 October 2023)

IN THE LABOUR COURT OF SOUTH AFRICA, JOHANNESBURG

Not Reportable

Case No: J967/23

In the matter between:

MARS CONSUMER PRODUCTS AFRICA (PTY) LTD

Applicant

and

WILLEM SMITH

First Respondent

PERFETTI VAN MELLE SOUTH AFRICA (PTY) LTD

Second Respondent

Heard: 24 August 2023

Delivered: 06 October 2023 (This judgment was handed down electronically by circulation to the parties’ legal representatives by email, publication on the Labour Court website and release to SAFLII. The date and time for handing-down is deemed to be 10h00 on 06 October 2023.

JUDGMENT

PHEHANE, J

Introduction

[1] The applicant (Mars Africa) approaches this Court on an urgent basis to enforce the confidentiality and restraint of trade undertakings that the first respondent (Mr. Smith) agreed to by virtue of his

previous employment with Mars Africa. The second respondent (Perfetti) is joined in these proceedings as it has interest in the matter as it is Mr. Smith’s new employer. Both Mr. Smith and Perfetti have opposed this application.

Background and argument

[2] Mars Africa manufactures and sells various products in the fast-moving consumer goods sector (FMCGS) to various retailers and distributors. Its business is retailer and districution-based.

[3] Mr. Smith signed his employment contract with Mars Africa on 26 February 2016. Mr. Smith was employed in the position of Customer Development Manager with effect from 1 April 2016, tasked with growing and developing Mars Africa’s sales in South Africa. The restraint of trade and confidentiality undertakings are recorded in clauses 5 to 8 of the employment contract[1] which read as follows :

‘5. All information to which you gain access at MARS Multisales Africa must be held in strictest confidence and not divulged to any outside or unauthorised person. You will not at any time during your employment with the company, (except in the proper performance of the job), disclose or make use of any confidential information belonging to or coming into possession or control of MARS Multisales Africa.

6. The term “confidential information” means any information in any form emanating from MARS Multisales Africa or any other company of Mars Incorporated, which is not in the public domain.

6.1 Examples of such information include but not limited to, trade secrets, manufacturing methods, prices of materials sold or acquired, details of business contracts, cost and pricing policy, particulars of future business and personnel matters.

7. For a period of one year you will not render services to any client with whom you had business dealings of any nature on behalf of MARS Multisales Africa either directly or indirectly.

8. For a period of one year you will not be employed by a competitor of MARS Multisales Africa either directly or indirectly, e.g. consultant.’

[4] On 27 February 2018, Mr. Smith signed a confidentiality and a non-disclosure undertaking in favour of Mars Africa.[2] These confidentiality indertakings were signed by Mr. Smith in contemplation of his new role as Group Accounts Manager: South Africa, a role which he was promoted to on 1 March 2018.[3] This was a leadership role in which Mr. Smith oversaw Mars Africa’s key accounts strategy in South Africa.

[5] It is common cause that on 1 January 2022, Mr. Smith was appointed to the position of Group Accounts Manager: ROSSA (Rest of Sub-Saharan Africa)[4], which entailed a role swap of the incumbants of the roles of Group Accounts Manager: South Africa and Group Accounts Manager: ROSSA. Further, that Mr. Smith was tasked to build and maintain relationships with Mars Africa’s biggest customers in key ROSSA jurisdictions, particularly, Namibia, Botswana, Zimbabwe, Mozambique, Zambia, Malawi, Angola, the DRC and the Republic of Congo (Sub-Saharan Africa). Mr. Smith visited the key areas in the ROSSA region to develop new business and to develop Mars Africa’s strategy to deal with regulatory challenges in the region in order to enable Mars Africa to sell its products in the region. Mr. Smith was tasked to develop brand plans, actvity plans and tarding terms with distributors. In this leadership role, Mr. Smith had access to Mars Africa’s brand plans, account plans, market plans, new product development, stategic markets, investment portfolios, financial information, pricing and trading terms and loss and profit data.[5]

[6] It is also common cause that Mr. Smith resigned from Mars Africa with effect from 30 April 2023.[6]

[7] Mars Africa contends that Mr. Smith has breached the restraint of trade and confidentiality undertakings when he became employed by Perfetti, a direct competitor of Mars Africa, on 12 June 2023. Mr. Smith is employed by Perfetti in the position of Buiness Development Manager – South, Central Africa and Indian Ocean Islands and reports to Perfetti’s General Manager, Mr. Marx (also a former employee of Mars Africa). Mars Africa contends that the position Mr. Smith holds in Perfetti is subtantially the same position he held at Mars Africa.[7]

[8] Mars Africa contends that Perfetti operates in direct competition with Mars Africa, as both Mars Africa and Perfetti sell sweets, confectionery and chewing gum in several sub-Saharan territories. It is common cause that Mars Africa and Perfetti both operate and distribute the products in South Africa, Angola, the Democratic Republic of Congo (DRC), Botswana, Zambia and Zimbabwe.[8]

[9] Mr. Smith and Perfetti challenge the relief sought by Mars Africa on the following basis:

9.1 the restraint of trade agreement is ‘void for vagueness’ and thus unenforceable;

9.2 Mars Africa and Perfetti are not competitors; and

9.3 Mars Africa has no protectable interest.

[10] Mr. Smith contends that when he concluded restraint undertakings in 2016, this pertained to the role he was in at the time, which was relevant to South Africa only and therefore, the restraint provisions to not apply to the sub-Saharan region.[9] He signed no other restraint agreements when he was promoted and when the roles were swapped. He therefore contends that the restraint

undertakings are unenforeceable.[10] In addition, he avers that he is not in possession of any confidential information of Mars Africa, as he handed in his laptop when he resigned. Any confidential information he was exposed to, he cannot recall; the strategy session he attended in 2023 which

discussed Mars Africa’s strategic plans for sub-Saharan Africa for the period 2023 to 2025, he states, he cannot recall and that the plans would in any event, be revised. He further states that any confidential information is of no use to Perfetti as explained in the paragraph below.

[11] Both Mr. Smith and Perfetti allege that Perfetti is not a competitor of Mars Africa as the main business of Perfetti is the distribution of candy across the African continent and has a different business model/strategy, having secured distribution agreements with their distributors over the past 10 to 13 years in various conutries. They aver that Perfitti has different clients, products and operates in different geographical areas. In the same breath, the respondents allege that the products that Mars Africa sell and distribute are similar where they operate in the same countries in sub-Saharan Africa.

[12] Mr. Smith avers that he as extensive experience in the FMCGS which he obtained approximately 20 years before joining Mars Africa and he utilized his skills set in his employ with Mars Africa and required no training. In the premise, he contends that his know-how or skills cannot be subjected to restraint undertakings.[11]

Urgency

[13] Disputes regarding the enforcement of restraint of trade undertakings are inherently urgent.[12] Such disputes are inextricably bound to specific timeframes in which they can be enforced, and if they are not enforced within such period, they are rendered academic. As such, there is normally no alternative manner in which an applicant in such a dispute may obtain adequate redress.[13]

[14] Mars Africa contends that this application is urgent because Mr. Smith, for every day that he remains in the employ of or otherwise associated with Perfetti, is able to make the confidential information of Mars Africa available for Perfetti’s use, which Perfetti, in turn, is able to use to compete unlawfully with Mars Africa. Further, Mr. Smith having been privy to the confidential strategic information of Mars Africa, is able to use such information to advance his work for and obligations to Perfetti in terms of his job description with Perfetti.

[15] Mr. Smith left the employ of Mars Africa on 30 April 2023. Mars Africa became aware of Mr. Smith’s employment with Perfetti on 10 June 2023, after Mr. Smith updated his LinkedIn page. Mars Africa immediately contacted Mr. Smith and reminded him of his restraint and confidentiality undertakings and that he was in breach thereof and tried to encourage him not to persist with such breach, which he refused to do.

[16] Before launching this application, Mars Africa attempted to resolve the dispute with Mr. Smith and Perfetti. Mr. Smith admitted on 15 June 2023 to being employed by Perfetti and according to Mars Africa, Mr. Smith provided Mars Africa with irrefutable evidence, including his job description at Perfetti, that he had breached his restraint of trade undertakings.

[17] There were numerous subsequent exchanges between Mars Africa and Mr. Smith. Mr. Smith was afforded until 30 June 2023 to provide written undertakings to Mars Africa’s satisfaction and when he refused to do so on 30 June 2023, Mars Africa proceeded to prepare this application.

[18] I am satisfied that Mars Africa has made out a case on emergency and this application is dealt with on an urgent basis.

Applicable legal framework

[19] The legal principles applicable in restraint disputes are now settled in our law.[14] A party seeking to enforce restraint of trade undertakings is required only to invoke the restraint agreement and to prove a breach thereof. The respondent who then seeks to avoid the restraint undertakings bears the onus to demonstrate, on a balance of probabilities, that the restraint agreement is unenforceable because it is unreasonable.

[20] The test to determine the reasonableness of restraint of trade undertakings is set out in Basson v Chilwan and others[15] (Basson). The test is summarised in the following four questions:

20.1 is there any interest of the one party which is deserving of protection at the termination of this agreement?

20.2 is such interest prejudiced by the other party?

20.3 if so, does such interests weigh up qualitatively and quantitatively against the interest of the latter party, in that the latter party should not be economically inactive and unproductive?

20.4 is there another facet of public policy having nothing to do with the relationship between the parties, but which requires that the restraint should either be maintained or rejected?

[21] In Kwik Kopy (SA) (Pty) Ltd v van Haarlem and Another[16] Wunsh J added a further consideration, namely whether the restraint goes further than is necessary to protect the interest which is contrary to public policy.

[22] It is well established that proprietary interests that can be protected by the restraint agreement are comprised of two kinds –

22.1 firstly, confidential information which is useful for the carrying on of the business and which if disclosed, could be used by a competitor to gain a relative competitive advantage. Such confidential material is succinctly referred to as “trade secrets”; and

22.2 secondly, the relationships with customers, potential customers, suppliers and others, referred to as the “trade connection” of the business.[17]

[23] In New Justfun Group (Pty) Ltd v Turner and others[18], this Court, per van Niekerk J with reference to Sibex Engineering Services[19] summarised proprietary interests as follows:

‘[12] Proprietary interests that are legitimately capable of protection by a restraint agreement extend both to confidential matters which are useful for the carrying on of the business and which could be used by a competitor, if disclosed, to gain a relative competitive advantage, and to relationships with customers, potential customers, suppliers and others that go to make up what is referred to as the “trade connection” of the business. The second kind of proprietary interest capable of protection is that which comprises confidential matter useful for the carrying on of the business, and which could be used by a competitor, if disclosed, to gain a relative competitive advantage. These are referred to as “trade secrets” (see Sibex Engineering Services (Pty) Ltd v Van Wyk 1991 (2) SA 482 (T)).

[13] …

[14] Whether confidential information is properly the subject of protection is a factual question. The respondent must establish that he or she had no access to that information or that he or she had never acquired any significant personal knowledge of, for instance, the applicant’s customers while in the applicant’s employ. All that an applicant need show is that there is secret information to which the respondent had access and which in theory the respondent could transmit to the new employer should he or she desire to do so. Where the ex-employer seeks to enforce against an ex-employee a protectable interest recorded in a restraint, the ex-employer does not have to show that the ex-employee has in fact utilised information confidential to it; it is sufficient to show that the ex-employee could do so. Indeed, the very purpose of a restraint agreement is that the applicant does not wish to have to rely on the bona fides or lack of retained knowledge on the part of the respondent, of the confidential information.’ [Emphasis added]

[24] From the afore-going, it transpires that whether information is confidential is a factual enquiry – the information must be capable of application in trade or industry; that is, it must be useful and must not be in the public domain and must be of economic value to the person seeking to protect it.[20]

[25] The need for an employer to protect its trade connections arises in a situation where the employee has access to customers and is able to build up a particular relationship with those customers, so that when the employee leaves the employer’s service she/he could easily induce the customers to follow him/her to a new business to the detriment of the former employer.

[26] In Den Braven SA (Pty) Ltd v Pillay and another,[21] the Court stated as follows:

‘… It suffices for the applicant to show the trade connections through customer contact exist and can be exploited by the former employee if employed by a competitor.’

[27] The respondent must demonstrate that he had no access to confidential information and that he never acquired any significant personal

knowledge of, or influence over, the applicant’s customers while in the applicant’s employ.[22]

[28] Where the applicant has endeavoured to safeguard itself against the unpoliceable danger of the respondent communicating its trade secrets to, or utilising its customer connections on behalf of a rival concern by obtaining a restraint, the risk that the respondent will do so is one which the applicant does not have to run. Neither is it incumbent upon the applicant to enquire into the bona fides of the respondent and demonstrate that he is not mala fides before being allowed to enforce its contractually agreed right to restrain the respondent.[23]

[29] In those circumstances, all the applicant needs to do, is to demonstrate that there is confidential information to which the respondent had access, and which the respondent could transmit to a competitor. Put differently, where a former employer seeks to enforce against its former employee a protectable interest recorded in restraint undertakings, the former employer does not have to show that the former employee has in fact used the confidential information - it suffices that the former employee could do so. The former employer should not have to content itself with “crossing his fingers” in the hope that the former employee would abide by the restraint undertakings.[24]

[30] In Experian South Africa (Pty) Ltd v Haynes and another[25], Mbha J stated as follows with reference to the respondent’s contention that the applicant’s information was not confidential because it was in the public domain:

‘… irrespective of whether or not information is in the public domain, the fact that the respondent has obtained such information within the context of a confidential relationship means that it in fact is protectable’.

[31] Mbha J then referred to Multi Tube Systems (Pty) Ltd v Ponting and others[26] where Broome J quoted the following from Terrapin Ltd v Builders Supply Co (Hayes) Ltd:[27]

‘As I understand it, the essence of this branch of the law, whatever the origin of it may be, is that a person has obtained information in confidence is not allowed to use it as a springboard for activities detrimental to the person who made the confidential communication, and springboard it remains even when all the features have been published can be ascertained by actual inspection by any member of the public’.

Argument and evaluation

[32] Perfetti raised a preliminary point that Mr. Smith is not employed by it, but by a labour broker. This preliminary point was abandoned at the commencing of the hearing of oral argument.

[33] The answering affidavits of Mr. Smith and Mr. Marx (the deponent to the answering affidavit and the General Manager of Perfetti, and former employer of Mars Africa,) contain averments that are to a large extent, a copy and paste of each other’s affidavits in relation to firstly, them challenging the locus standi of Mr. Klopper, the deponent to the founding affidavit of Mars Africa and its Sales and Export Director. The respondents no longer pursue this challenge, it would appear, pursuant Mars Africa attaching to its replying affidavit, a resolution demonstrating that Mr. Klopper (amongst others) is duly authorised to launch these proceedings on its behalf.[28] Secondly, Messrs. Smith and Marx’s answering affidavits contain a copy and paste of averments relating to the comparison of products that are sold (and distributed) by Perfitti and Mars Africa, ultimately, stating that the products are similar. Thirdly, the affidavits contain a copy and paste of the countries in which Perfetti and Mars Africa have a footprint in sub-Saharan Africa.

Fourthly, the affidavits contain a cut and paste of each of the several replies to the founding affidavit. Mr. Marx asserts

that Perfettii did not intend to opose this applicaton, but elected to do so as, according to him, the founding affidavit of Mr. Kloppers is “fraught with inaccuracies and defamatory allegations”[29] I mention the copy and paste, as set out above, as this has resulted in repetitive averments and voluminous pleadings before this Court which is uncecessary and the reason for the costs order as set out below.

[34] In the heads of argument filed on behalf of the respondents, the respondents raise for the first time, that Mr. Smith’s appointment letter is drafted on the letter head. Ostensibly, of Mars Consumer Products (Pty) Ltd, but the restraint undertakings are in favour of an entity named MARS Multisales Africa.[30]

[35] Mr. Whitcutt on behalf of the applicant submitted that MARS Multisales Africa is the trading name of the applicant and referred to the registartion number of the entity as it appears on page 34 (Mr. Smith’s letter of appointment) and the resolution of Mars Africa authorising Mr. Kloppers and others to launch these proceedings. In addition, Mr. Whitcutt sought leave for Mars Africa to file a further affidavit explaining that Mars Africa and Mars Consumer Products (Pty) Ltd are the same entity in light of the issue being raised by the respondents for the first time in their heads of argument without Mars Africa having the opportunity to deal with the issue. Leave was granted to Mars Africa to file a further affidavit in this regard. The further affidavit filed by Mars Africa confirms the aforegoing.

[36] It is in any event, not disputed that Mr. Smith concluded a restraint and confidentiality undertakings with Mars Africa as refelected in his letter of appointment and confidentiality undertakings which documents bear the same registration number as that in the resolution.

[37] Mr. Smith and Perfetti allege that the restraint provisions are vague as it is unclear from what date the restraint takes effect. Further, the geographical area of the restraint is unknown, as are the clients of the applicant. In light of the vagueness of the restraint provisions, the respondents contend that the restraint agreement is

unenforceable.

[38] It has been held, that even when a restraint of trade clause is not a “model of clarity” it can make sense once one “cuts through the clutter”.[31]

[39] In Natal Joint Municipal Pension Fund v Endumeni Municipality,[32] the Supreme Court of Appeal (SCA) held that legal documents should be interpreted in a business-like manner and stated thus:

‘Interpretation is a process of attributing meaning to the words used in a document, be it legislation, some other statutory instrument, or contract, having regard to the context provided by reading the particular provision or provisions in the light of the document as a whole and the circumstances attended upon its coming into existence. Whatever the nature of the document, consideration was given to the language used in the light of the ordinary rules of grammar and syntax; the context in which the provision appears; the apparent purpose to which it is directed, and the material to those responsible for its production. Where more than one meaning as possible each possibility must be weighed in the light of all these factors. The process is objective not subjective. A sensible meaning is to be preferred to one that leads to insensible and business-like results or undermines the apparent purpose of the document. Judges must be allergic to, and are against, the temptation to substitute what is reasonable, sensible business-like for the was actually used. To do so in regard to a statute or statutory instrument is to cross the divide between interpretation and legislation. A contractual context it is to make a contract for the parties rather than one day in fact made. The inevitable point of departure is the language of the provision itself - waiting context and having regard to the purpose of the provision and the background to the preparation and production of the document’.

[40] Although the restraint undertakings are not a model of clarity, on a business-like and sensible interpretation of the restraint

undertakings, taking into consideration the context of the restraint undertakings, their purpose, as well as the intentions of the parties in concluding the restraint undertakings, the period of restraint commences from the date of termination of Mr. Smith’s

employment with the applicant. This is the usual position in restraint undertakings: the employee is restrained from the date of

termination of employment for the period stated in the agreement, in the present case, a period of one year. This is certainly Mr. Smith’s own understanding, as he undertakes (although belatedly given that the applicant sought this undertaking prior to launching these proceedings), that he will not contact or approach Mars Africa’s distributors in any of the countries where it operates for a year from his resignation.[33] The products of and countries in which Mars Africa operates is common cause, and it is common cause that these products are similar to those of Perfetti.[34] In the circumstances, I do not find that the restraint provisions are vague.

[41] Mr. Smith bears the onus of proving that the enforcement of the restraint undertakings are unreasonable and contrary to public interest.[35]

[42] Mr. Smith alleges that the restraint undertakings should not apply, as the parties did not contemplate their application beyond his original role at Mars Africa and that the restraint is “void for vagueness”. I have already dealt with the latter contention. The allegation that the restraint undertakings do not apply beyond his original role does not prove that the restraint undertakings are unreasonable or contrary to public interest. It is common cause that Mr. Smith fulfils substantially the same role at Perfetti that he did at Mars Africa. Mr. Smith is privy to the account plans of Mars Africa which disclose Mars Africa’s strategy, financial and investment plans in the sub-Saharan African region for 2023 to 2025. Mr. Smith had access to confidential and proprietary information of Mars Africa, including new products in development, markets in which Mars Africa was strategically focused on, investment portfolios, financial information, pricing and trading terms concluded with distributors and value chains, including profit and loss data. Mr. Smith was involved in the development of and access to brand plans, activity plans and trading terms concluded with distributors of Mars Africa. Further, Mr. Smith was tasked with building and maintaining relationships with Mars Africa’s biggest customers and key jurisdictions, including Angola, the DRC, Zambia and Zimbabwe and was tasked with growing and developing Mars Africa sales in South Africa.

[43] Mr. Smith had access to confidential and proprietary information of Mars Africa relating to its area, brand plans, competence, local plans, new products and developments and which areas Mars Africa was or is strategically focused on. He knows Mars Africa strategy and trade in sub-Saharan Africa and is able to enable Perfetti to compete directly with Mars Africa. Mr. Smith was described by Mr. Marx as the best candidate for the job as he could “hit the ground running”, knowing the markets and product categories in which Perfetti operates.

[44] Mr. Smith’s job description with Perfetti shows that he is responsible for the growth of Perfetti’s business across sub-Saharan Africa. The answering affidavits by Mr Smith and Perfetti state the countries that Perfetti currently operates in. Given Mr. Smith’s role to grow Perfetti’s business, a role he was tasked with in Mars Africa, albeit for a period of nine months before he resigned, the risk is that he could disclose information to Perfetti to the detriment of Mars Africa, as his loyalties lie with Perfetti, his new employer.[36] Mars Africa is thus entitled to enforce this restraint and confidentiality undertakings.

[45] In view of the afore-going, Mars Africa has made out a case of the relief that it seeks, supported by the facts admitted by Mr Smith and Mr Marx.[37]

[46] The respondents allege that Mars Africa has not demonstrated any protectable interest and simply listing plans, financial information,

investment portfolios is not sufficient.[38]

[47] Mars Africa has demonstrated the nature of its business, its area of operation and the confidential information Mr Smith has access to. This is not disputed. Mars Africa has also demonstrated the two types of proprietary interests as set out in Sibex that are worthy of protection: It has shown the existence of trade secrets that if disclosed by Mr. Smith, would give Perfetti a relative competitive advantage over it and it has shown that trade connections exist and could be exploited by Mr. Smith as he is employed by its competitor.[39] That being said, the onus is on Mars Africa to invoke the restraint agreement and to prove the breach thereof. Mars Africa has discharged its onus.

[48] For a restraint to be unreasonable and unenforceable, there must be an absence of an interest deserving of protection. Mr Smith has not discharged the onus on him to prove that the restraint undertakings are unenforceable and contrary to public interest. He has not shown that he has not had access to the confidential information that Mars Africa seeks to protect. The confidential information of Mars Africa that he has had access to, would give Perfetti, a competitor, a relative competitive advantage over Mars Africa.

[49] Mr. Smith has vast experience in the FMCGS – this is not disputed. In my view, nothing deters him from being employed in this sector in other geographical regions where Mars Africa does not operate and with regard to other products that Mars Africa does not trade in.

[50] In light of the afore-going, the applicant has demonstrated injury that is reasonably apprehended and this necessitates the granting of final relief.

Costs

[51] In adjudicating disputes involving the enforcement of restraint undertakings, this Court exercises jurisdiction in terms section 77 of the Basic Conditions of Employment Act.[40] In the premises, the rule that costs do not follow the result does not apply.

[52] Both Messrs. Smith and Marx’s affidavits are argumentative, repetitive, replete with allegations in emotive terms that are not borne out by the evidence and are void of objective fact or evidence to counter Mars Africa’s contentions.[41] Mr Marx, an erstwhile employee of Mars Africa, states that this application was “fraught with inconsistencies and defamatory allegations” and that Perfetti accordingly had “no other option but to oppose application”[42] and to “set the record straight”[43] whereas the opposition to a large extent comprised of a copy and paste of Mr. Smith’s opposing affidavit. The conduct of the respondents in opposing this application on the grounds of the vagueness of the restraint provisions, the unenforceability of the restraint provisions due to role changes and identity of the applicant, all against the backdrop of a plea for leniency by Perfetti not to enforce the restraint undertakings,[44] and Mr. Marx listing other former employees of Mars Africa against whom restraint provisions were not enforced, all point to Mr. Smith attempting to avoid his restraint undertakings. In my view, the fact surrounding the restraint undertakings of other employees do not detract from the right of Mars Africa to enforce the restraint and confidentiality undertakings by Mr. Smith in its favour.

[53] In view of Mr. Smith and Perfetti’s conduct as aforesaid, the requirements of the law and fairness dictate that an order as to the payment of costs should be made against the respondents.

[54] In the premise, the following order is made:

Order:

1. The matter is heard as urgent in terms of rule 8 of the Rules for the Conduct of Proceedings in the Labour Court.

2. Leave is granted to the applicant to file a further affidavit.

3. The first respondent is interdicted and restrained until 30 April 2024, from either directly or indirectly:

3.1 being employed by, or otherwise engaged (for example, as a consultant) within the business of the second respondent;

3.2 competing with the applicant, or being employed or otherwise concerned with any business entity competing with the business of the applicant (i.e. in the Republic of South Africa, Namibia, Botswana, Zimbabwe, Mozambique, Zambia, Malawi, Angola, the Democratic Republic of the Congo, Republic of Congo, Tanzania, Kenya, Ethiopia, Djibouti,

Nigeria and Ghana (“the territory”)).

4. The first respondent is interdicted and restrained until 30 April 2024 months from either directly or indirectly rendering services to the applicant’s clients with whom the first respondent had business dealings on behalf of the applicant;

5. The first respondent is interdicted and restrained until 30 April 2024 from either directly or indirectly:

5.1 using any of the confidential property, intellectual property or trade secrets of the applicant;

5.2 divulging or disclosing to any third party, including the second respondent, any other confidential information, intellectual property, or trade secrets of the applicant.

6. The first and the second respondents are to pay the costs of this application jointly and severally, the one paying and the other to be absolved.

M. T. M. Phehane

Judge of the Labour Court of South Africa

Appearances:

For the Applicant: Adv. Christopher Whitcutt SC and Adv. Chrisna Bekker Instructed by: Edward Nathan Sonnenbergs Inc. For the First Respondent: Adv. WJ Bezuidenhout Instructed by: Van Niekerk Attorneys

[1] Annexure “FA2” on p 35.

[2] Annexure “FA3” on pp 37 to 38.

[3] Respondents’ heads of argument, at para 2.5.

[4] First respondent’s answering affidavit, at para 9, p 73.

[5] Mr. Smith does not dispute or take issue with the facts pleaded in the founding affidavit insofar as they relate to the business of the applicant and his role and area of responsibility while he was employed by the applicant.

[6] See: founding affidavit, at para 6, p 6 and first respondent’s answering affidavit, at para 8, p 91.

[7] Replying affidavit, at para 8.4, p 143.

[8] Applicant’s heads of argument at para 8.

[9] See: first respondent’s answering affidavit at paras 21 to 25, pp 75 to 76.

[10] First respondent’s answering affidavit at paras 21 to 25, pp 75 to 76.

[11] Respondents’ heads of argument at paras 23 and 24 and the authorities cited therein.

[12] ARB Electrical Wholesalers (Pty) Ltd v Grove and others (C335/14) [2014] ZALCCT 31 (03 June 2014) at para 20.

[13] Mpact Operations (Pty) Ltd t/a Mpact Plastics Wadeville v Whitehead and Another J1335/2015 [2015] ZALCJHB 442 (25 September 2015) at para 8.

[14] See: Experian South Africa (Pty) Ltd v Haynes and another (2013) 34 ILJ 529 (GSJ); Basson v Chilwan and others [1993] ZASCA 61; 1993 (3) SA 742 (A). Magna Alloys and Research (SA) (Pty) Ltd v Ellis [1984] ZASCA 116; 1984 (4) SA 874 (A); Den Braven SA (Pty) Ltd v Pillay and another 2008 (6) SA 229 (D).

[15] 1993 (3) SA 742 (A) 767 F – H.

[16] 1999 (1) SA 472 (W) at 484 E.

[17] Sibex Engineering Services (Pty) Limited v Van Wyk and another 1991 (2) SA 482 (T).

[18] (2018) 39 ILJ 2721 (LC) at paras 12 and 14. See also: Experian (Id fn 14) at para 17 and BHT Water Treatment (Pty) Ltd v Leslie and another 1993 (1) SA 47 (W) at 57J to 58D.

[19] Fn 17 supra.

[20] Townsend Productions (Pty) Ltd v Leech and others 2001 (4) SA 33 (C) at 53 H – 54 B; Mossgas (Pty) Ltd v Sasol Technology (Pty) Ltd [1999] 3 All SA 321 (W) at 333F; Walter McNaughten (Pty) Ltd v Schwartz and others 2004 (3) SA 381 (C) at 388 J – 389 B.

[21] 2008 (6) SA 229 (D) at 240 H.

[22] Rawlins and another v Caravantruck (Pty) Ltd [1992] ZASCA 204; 1993 (1) SA 537 (A) at 542 F – 543 A; Branco and another t/a Mr Cool v Gale 1996 (1) SA 163 (E) at 178 G - H.

[23] See: IIR South Africa BV (Incorporated in the Netherlands) t/a Institute for International Research v Tarita and others 2004 (4) SA 156 (W) at 166 H – 167 C.

[24] See: IIR South Africa (Ibid).

[25] (2013) 34 ILJ 529 (GSJ).

[26] 1984 (3) SA 182 (D) at p 189 D – E.

[27] 1960 RPC128 (CA).

[28] Replying Affidavit pp173 to 174.

[29] Second respondent’s founding affidavit at para 19, p 114.

[30] Respondents’ heads of argument, at paras 2 and following. The answering affidavits do not traverse the allegation in paragraph 1 of the founding affidavit at p6, which states that the applicant is Mars Consumer Products Africa (Pty) Ltd.

[31] See: ARB Electrical Wholesalers, (id fn 12) at paras 6 and 7.

[32] 2012 (4) SA 593 (SCA) at para 18.

[33] First respondent’s answering affidavit, at para 153, on p 103.

[34] On the admission of both Mr Smith and Marx, there is at least “a possible” 15% overlap in similar products.

[35] See: Basson v Chilwan (Id fn 15).

[36] Reddy v Siemens Telecommunications (Pty) Ltd 2007 (2) SA 486 (SCA); BHT Water Treatment (Pty) Ltd v Leslie and another 1993 (1) SA 47 (W).

[37] Plascon-Evans Paints (TVL) Ltd v Van Riebeeck Paints (Pty) Ltd [1984] ZASCA 51; (1984) (3) SA 623 (A).

[38] Respondent’s heads of argument at paras 11, 19 to 23 and the authorities cited therein.

[39] See: Den Braven SA v Pillay (Id fn 21).

[40] Act 75 of 1997.

[41] See: Venmop 275 (Pty) Ltd v Cleverland Projects (Pty) Ltd and Another 2016 (1) SA 78 (GJ) at paras 15 to 16.

[42] Second respondent’s answering affidavit at para 19 on p 114.

[43] Ibid at para 13, p 198.

[44] See: founding affidavit at para 57 on pp 21 to 22 and answering affidavit by the second respondent at paras 75 o p 126 and paras 14 to 20 on p113.