[2025] FCA 1154
General information, not legal advice.
Federal Court of Australia
2025-09-08
Longbottom J
Original judgment source is linked above.
Australian Broadcasting Corporation v O'Neill [2006] HCA 46; (2006) 227 CLR 57
Australian Property Scout Holdings Pty Ltd v Titus [2025] FCA 1064
Beecham Group Ltd v Bristol Laboratories Pty Ltd (1968) 118 CLR 618
Del Casale v Artedomus (Aust) Pty Ltd [2007] NSWCA 172; (2007) 73 IPR 326
Federal Commissioner of Taxation v Trustee for the Michael Hayes Family Trust [2019] FCAFC 226; (2019) 273 FCR 567
IPC Global Pty Ltd v Pavetest Pty Ltd [2017] FCA 82; (2017) 122 IPR 445
Just Group Ltd v Peck [2016] VSCA 334; (2016) 344 ALR 162
Moorgate Tobacco Co Ltd v Philip Morris (No 2) [1984] HCA 73; (1984) 156 CLR 414
Mount Bruce Mining Pty Ltd v Wright Prospecting Pty Ltd [2015] HCA 37; [2015] 256 CLR 104
Native Extracts Pty Ltd v Plant Extracts Pty Ltd (No 2) [2024] FCA 106
Optus Networks Pty Ltd v Telstra Corporation [2010] FCAFC 21; (2010) 265 ALR 281
Ord Minnett Holdings Pty Ltd v Longmuir [2023] FCA 1262
Samsung Electronics Co Ltd v Apple Inc (2011) 217 FCR 239
Seymour Whyte Constructions Pty Ltd v Ostwald Bros Pty Ltd (In Liq) [2019] NSWCA 11; (2019) 99 NSWLR 317
Shercliff v Engadine Acceptance Corp Pty Ltd [1978] 1 NSWLR 729
Smart EV Solutions Proprietary Limited v Guy [2023] FCA 1580
Warner-Lambert Co LLC v Apotex Pty Ltd [2014] FCAFC 59; (2014) 311 ALR 632
Wilson Pateras Accounting Pty Ltd v Farmer [2020] FCA 1763
Wright v Gasweld Pty Ltd (1991) 22 NSWLR 317
Zomojo Pty Ltd v Hurd (No 2) [2012] FCA 1458; (2012) 299 ALR 621
Commercial Contracts, Banking, Finance and Insurance
AUSTRALIAN PROPERTY SCOUT HOLDINGS PTY LTD ACN 663 223 425
AUSTRALIAN PROPERTY SCOUT PTY LTD ACN 638 266 369
(a) APS means Australian Property Scout Pty Ltd;
(b) APS Documents means the documents particularised in paragraph 17 of the Further Amended Statement of Claim;
(c) APS Payroll means APS Group Payroll Pty Ltd;
(d) Confidential Operating Areas are the names of Local Government Areas (LGAs) that APS has identified as growth areas which are referred to in the Confidential Annexure A to the Further Amended Statement of Claim (Confidential Annexure A).
(e) Dealt means the completion of work, including: the provision of details and information with respect to a potential property, acting as an advocate, communicated with them (either in writing or verbally) regarding their interest in and or subsequent purchase of, the property (irrespective of whether the purchase completed or not).
(f) Supplier means any person or organisation who supplied goods or services to APS or APS Payroll in exchange for payment of $500 or more in the period 5 April 2024 to 5 April 2025.
(a) taking or accepting any instructions or business from any person or organisation who was at any time between 5 April 2024 and 5 April 2025 a client or customer of, a supplier or contractor to, or investor in APS with whom the first respondent dealt or had substantial contact; or
(b) soliciting, interfering with or endeavouring to entice away from APS Payroll any employee, contractor or consultant of APS Payroll with whom the first respondent had contact in the course of carrying out his duties and which because of that contact obtained knowledge of their special skills and experience in the performance of their duties for APS Payroll.
(a) to be treated as confidential; and
(b) to be sealed on the Court file in an envelope marked "Not to be opened except by leave of the Court or a Judge";
(c) not to be published or made available and any electronic version thereof is to be treated in an analogous fashion;
(d) not to be disclosed to any person other than:
(i) the Court;
(ii) the applicants and their legal representatives; and
(iii) the respondents' legal representatives.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
The relevant principles in Australia are those explained in Beecham Group Ltd v Bristol Laboratories Pty Ltd. This court (Kitto, Taylor, Menzies and Owen JJ) said that on such applications the court addresses itself to two main inquiries, and continued:
The first is whether the plaintiff has made out a prima facie case, in the sense that if the evidence remains as it is there is a probability that at the trial of the action the plaintiff will be held entitled to relief ... The second inquiry is ... whether the inconvenience or injury which the plaintiff would be likely to suffer if an injunction were refused outweighs or is outweighed by the injury which the defendant would suffer if an injunction were granted.
(Footnotes omitted)
... The strength of that probability will depend on the nature of the case. To make out a prima facie case, the applicant need not establish that it is more probable than not that it will succeed at trial; merely that there is a sufficient likelihood of success to justify in the circumstances the preservation of the status quo pending the trial: ABC v O'Neill at 81 - 82 [65]. See also Armstrong World Industries (Australia) Pty Ltd v Parma [2014] FCA 743; (2014) 101 ACSR 150, 157 [24] (Armstrong World Industries).
... Accordingly, where the respondent goes into evidence on an interlocutory application, it is inappropriate to conduct what is, essentially, a preliminary trial to ascertain where the merits lie - in effect giving or withholding the interlocutory relief on a forecast as to the ultimate result of the case: Beecham at 622 - 623. Rather, once a prima facie case is established, the court should move to consider the balance of convenience.
[42] In cases where the confidential information is of the nature of a secret formula or process, involving a number of elements such that independent discovery by enquiry or experiment is unlikely to occur, that confidential information can quite readily be distinguished from an employee's general know-how. In those cases, the courts are ready to restrain use of that information by an ex-employee: see for example Amber Size & Chemical Co. Limited v. Menzel [1913] UKLawRpCh 65; [1913] 2 Ch. 239.
[43] However, where the confidential information is something that is ascertainable by enquiry or experiment, albeit perhaps substantial enquiry or experiment, and the know-how which the ex-employee is clearly entitled to use extends to knowledge of the question which the confidential information answers, it becomes artificial to treat the confidential information as severable and distinguishable from that know-how; and in that kind of case, courts have tended not to grant relief.
(Emphasis in original)
10. Confidentiality
(a) Other than for authorised use during the course of the Employee's employment or otherwise as required by law, the Employee must not disclose or make known to any person (including any firm or corporation) either during or after the Employee's employment has ended, any confidential information that the Employee has been provided, accessed or acquired during the course of the Employee's employment with the Employer.
(b) Confidential information includes but is not limited to the following types of information that the Employee may access, acquire or be provided with during the course of the Employee's employment with the Employer:
(i) all products, ideas, trade secrets and concepts concerning the technology, Intellectual Property or business of the Employer;
(ii) all financial information or other business information about the Employer and any of its divisions, customers, suppliers, products or strategies;
(iii) terms of contracts or arrangements between the Employer and any other party (including, without limitation, employees, contractors, agents, customers, suppliers and directors); and
(iv) research and development information, financial details and information, business plans, marketing plans and strategies, and any other information about the Employer, its business, its products and services or plans.
...
(d) The Employee's obligations under this Agreement do not merge on termination and endure for the benefit of the Employer.
The relevant principles to be applied in determining the validity of cl 9 of the Service Agreement may be summarised as follows:
- an obligation can be imposed by contract to keep information confidential and that obligation can extend to cover subject matter which is not protected by an equitable duty of confidence: Wright v Gasweld Pty Ltd (1991) 22 NSWLR 317 at 329, 335 and 340-341; Del Casale v Artedomus (Aust) Pty Ltd [2007] NSWCA 172; (2007) 73 IPR 326 at [34]- [36], [38], [46], [48], [50], [51], [77], [87], [92], [102], [118], [134] and [140] and Reed Business Information Pty Ltd v Seymour [2010] NSWSC 790 at [36];
- employers are entitled to protect by contractual covenant the use of information that is the result of work, experimentation and expense: Exchange Telegraph Company Limited v Central News Limited [1897] UKLawRpCh 85; [1897] 2 Ch 48 at 53-54; AB Consolidated Ltd v Europe Strength Food Co Pty Ltd [1978] 2 NZLR 515; Interfirm Comparison (Aust) Pty Ltd v Law Society of New South Wales [1975] 2 NSWLR 104 at 117; Industrial Furnaces Ltd v Reaves [1970] RPC 605 at 617 and International Scientific Communications Inc v Pattison [1979] FSR 429 at 434;
- the know-how, or knowledge of how to solve particular problems or the knowledge of methods not necessarily shared by others, acquired by an employee during his or her employment, while ordinarily not protected by equity, is capable of being protected by a contractual covenant: Printers & Finishers Ltd v Holloway (No 2) [1964] 3 All ER 731 and 735-736; Wright at 329; Commercial Plastics Ltd v Vincent [1965] 1 QB 623 at 642 and Milwell Holdings Ltd v Johnson [1988] NZHC 199; (1988) 12 IPR 378 at 391-3;
- a contractual restraint upon the use of confidential information or know-how may be enforceable provided it is reasonable, in the sense of being necessary for the adequate protection of the interests of a party: Brightman v Lamson Paragon Ltd [1914] HCA 90; (1914) 18 CLR 331 at 335 and Reed Business Information at [36];
- whether a restraint is reasonable is a question of law and not of fact: Attorney-General (Cth) v Adelaide Steamship Co Ltd [1913] ArgusLawRp 89; (1913) 18 CLR 30 at 35; Buckley v Tutty [1971] HCA 71; (1971) 125 CLR 353 at 377; Amoco Australia Pty Ltd v Rocca Bros Motor Engineering Co Pty Ltd [1973] HCA 40; (1973) 133 CLR 288 at 317-318; Drake Personnel Ltd v Beddison [1979] VicRp 3; [1979] VR 13 at 19 and Cream v Bushcolt Pty Ltd [2004] WASCA 82; (2004) ATPR 42-004 at [23] and [30];
- in determining whether a restraint is reasonable the court should consider what is necessary to protect the legitimate interests of the person asserting the restraint in the circumstances of the case, assessed from the date of making the contract and making the best possible estimate of probabilities and contingencies then foreseeable: Amoco at 318; Drake Personnel at 25; Woolworths Ltd v Olson [2004] NSWCA 372 at [40] and Reed Business Information at [36]; and
- where, as here, the restraint concerns confidential information, the circumstances to be considered by the Court include:
7.1 the extent to which the information is known outside the business;
7.2 the skill and effort expired to collect the information;
7.3 the extent to which the information is treated as confidential by the employer;
7.4 the value of the information to competitors;
7.5 the ease or difficulty with which the information can be duplicated by others;
7.6 whether it was made known to the employee that the information was confidential; and
7.7 whether the usages and practices in the industry support the claim of confidentiality,
Reed Business Information at [36].
(a) the Confidential Operating Areas are the output of a confidential methodology developed by Mr Gordon by which he identifies growth areas. Those areas are commercially‑sensitive because purchasing properties in those areas is central to APS Group's business. APS typically operates in the Confidential Operating Areas for a period of 12 to 24 months, after which the area will become saturated;
(b) APS Group's staff (including buyers' agents) are subject to contractual obligations of confidentiality with respect to the Confidential Operating Areas. The confidential nature of that information is reinforced by reminders from the Chief of Operations. APS' clients will be informed of one potential property within one growth area but are not told of the Confidential Operating Areas as a whole. The only information that an APS client receives after signing an agreement, which contains a confidentiality clause, is the address of a property that will help the client achieve their investment goals. At no time is an APS client told that the LGA in which their property is located is one of the Confidential Operating Areas; and
(c) Mr Gordon believes that Mr Titus knows about all of the Confidential Operating Areas because they were discussed during the course of buyers' agents' meetings that he attended which occurred between 5 February 2024 and 5 February 2025. On 6 June 2025, Mr Titus uploaded an Instagram reel, the "comment section" of which identifies his "top three areas" for buying investment properties as being three of the Confidential Operating Areas.
By consent, and without admissions, the respondents will from the date of this order until further order or the conclusion of these proceedings keep accounts recording each of their clients, the address of any property or properties purchased for them, and the fees received from them and the expenses incurred in providing services to them.
[46] The rights and liabilities of parties under a provision of a contract are determined objectively, by reference to its text, context (the entire text of the contract as well as any contract, document or statutory provision referred to in the text of the contract) and purpose.
[47] In determining the meaning of the terms of a commercial contract, it is necessary to ask what a reasonable businessperson would have understood those terms to mean. That enquiry will require consideration of the language used by the parties in the contract, the circumstances addressed by the contract and the commercial purpose or objects to be secured by the contract.
[48] Ordinarily, this process of construction is possible by reference to the contract alone. Indeed, if an expression in a contract is unambiguous or susceptible of only one meaning, evidence of surrounding circumstances (events, circumstances and things external to the contract) cannot be adduced to contradict its plain meaning.
[49] However, sometimes, recourse to events, circumstances and things external to the contract is necessary. It may be necessary in identifying the commercial purpose or objects of the contract where that task is facilitated by an understanding "of the genesis of the transaction, the background, the context [and] the market in which the parties are operating". It may be necessary in determining the proper construction where there is a constructional choice. The question whether events, circumstances and things external to the contract may be resorted to, in order to identify the existence of a constructional choice, does not arise in these appeals.
[50] Each of the events, circumstances and things external to the contract to which recourse may be had is objective. What may be referred to are events, circumstances and things external to the contract which are known to the parties or which assist in identifying the purpose or object of the transaction, which may include its history, background and context and the market in which the parties were operating. What is inadmissible is evidence of the parties' statements and actions reflecting their actual intentions and expectations.
[51] Other principles are relevant in the construction of commercial contracts. Unless a contrary intention is indicated in the contract, a court is entitled to approach the task of giving a commercial contract an interpretation on the assumption "that the parties ... intended to produce a commercial result". Put another way, a commercial contract should be construed so as to avoid it "making commercial nonsense or working commercial inconvenience".
(Footnotes omitted)
12. Restrictive covenants after termination of employment
(a) Unless the Employee has obtained the Employer's prior written consent, the Employee must work exclusively for the Employer.
(b) Unless the Employee has obtained the Employer's prior written consent, the Employee must not for the Restraint Period outlined in Item 9 of Schedule 1 of this Agreement after the Employee's employment ends (for whatever reason), in the Restraint Area outlined in Item 10 of Schedule 1:
(i) take or accept any instructions or business from any person or organisation who was at any time during the 12 months prior to the Employee's employment ending, a client or customer of, a supplier or contractor to, or investor in the Employer with whom the Employee dealt or had substantial contact; or
(ii) solicit, interfere with or endeavour to entice away from the Employer any employee, contractor or consultant of the Employer with whom the Employee had contact in the course of carrying out the Employee's duties and which because of that contact obtained knowledge of their special skills and experience in the performance of their duties for the Employer.
(c) The Employee acknowledges and agrees that:
(i) in the course of its employment, the Employee will gain knowledge of confidential information and form working relationships with the other employees, contractors, customers and suppliers of the Employer and as a result will be in a position to cause harm to the legitimate business interests of the Employer on leaving the employment;
(ii) the only effective, fair and reasonable manner in which the interests of the Employer can be protected is by these restraints and the maximum duration, extent and application of these restrictions are not greater than is reasonably necessary for the protection of the legitimate business interests of the Employer, given the nature of the business and undertaking of the Employer; and
(iii) damages may not be an adequate remedy for the Employer for any breach of the restraints contained in this clause and the remedies of injunction, specific performance and other equitable relief may be appropriate for any threatened or actual breach of this clause.
· Prospect and source properties that meet Australian Property Scout criteria.
· Provide weekly and monthly reporting to the Head Buyer's Agent.
· Work with the Head Buyer's Agent on the development of strategies to grow the volume of deals and support new business development opportunities.
· Raise any department related issues to the Head Buyer's Agent and provide immediate resolutions.
· Participate and add value in department and company meetings.
· Build productive and long term relationships with company clients and corporate partners including; Pest and building contractors, conveyancers, mortgage brokers, real estate agents and property managers.
· Support company clients by providing them with consistent and detailed communication.
· Ensure service levels meet or exceed client expectations.
· Raise any grievances to the Head Buyer's Agent and contribute to a positive working environment.
· CRM management - upkeep client records, manage tasks/activities, communications and general workflow within the CRM.
(a) 12 months;
(b) If (a) is not enforceable then, 6 months;
(c) If (a) and (b) are not enforceable then, 3 months; or
(d) If (a), (b) and (c) are not enforceable then, 1 month.
(a) Australia;
(b) If (a) is not enforceable then, within 20km of the Employer's principal place of business;
(c) If (a) and (b) are not enforceable then, within 10km of the Employer's principal place of business; or
(d) If (a), (b) and (c) are not enforceable then, within 5km of the Employer's principal place of business.
8. The Employee is not authorised to trade externally to APS as a buyers agent, buyers advocate or in any similar role to their employment.
(a) that applying the literal meaning of "Employer" is an absurdity because APS Payroll did not have "clients or customers" on behalf of whom properties would be sourced and acquired by Mr Titus as an employee;
(b) it is self-evident that the objective intention was to refer to the actual entity through which APS Group carried on its business of sourcing and acquiring properties for clients and customers, namely, APS.
Definition of "dealt or had substantial contact" and "supplier or contractor"
"dealt or had substantial contact" means:
- substantial correspondence or communication with in my professional capacity and or as part of my work; or
- the completion of work, including: the provision of details and information with respect to a potential property, acting as an advocate, communicated with them (either in writing or verbally) regarding their interest in and or subsequent purchase of, the property (irrespective of whether the purchase completed or not).
"Supplier" means any person or organisation who supplied goods or services to APS or APS Payroll in exchange for payment of at least $500 or more in the financial year period 5 April 2024 to 5 April 2025. to 30 June 2025.
(Amendments in the original)
I certify that the preceding sixty-six (66) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Longbottom.
Australian Property Scout Holdings Pty Ltd
Titus
(2014) 311 ALR 632
(1991) 22 NSWLR 317
(1913) 18 CLR 30
(1973) 133 CLR 288
(2006) 227 CLR 57
(2010) 265 ALR 281
(2011) 217 FCR 239
(1971) 125 CLR 353
(1984) 156 CLR 414
(2019) 99 NSWLR 317
(1988) 12 IPR 378
(1914) 18 CLR 331
(2012) 299 ALR 621
(1968) 118 CLR 618
(2019) 273 FCR 567
(2016) 344 ALR 162
(2007) 73 IPR 326
(2017) 122 IPR 445