Heath Lambert Australia Pty Ltd v Keenan [2000] VSC 533

11. On 28 November the plaintiff filed a writ in the proceeding in which it seeks the following relief against the defendants:

"1. An injunction restraining the first and second defendants from breaching the terms of their contracts of employment with the plaintiff dated 28 January 1997 and 17 September 1998 respectively and specifically restraining them from: (a) in the case of the first defendant: undertaking or carrying on or being directly or indirectly concerned or interested either as an employer, an employee, consultant or director in any business other than the plaintiff's during the period from 13 November 2000 to 13 February 2001; (b) in the case of the second defendant: undertaking or carrying on or being directly or indirectly concerned or interested either as an employer, an employee, consultant or director in any business other than the plaintiff's during the period from 13 November 2000 to 13 December 2000; (c) using or distributing in any way any information, process, papers or documents which they have obtained access to in the course of their employment with the plaintiff; (d) from visiting or in any way communicating with any servant or agent of the third defendant during the course of the period from 13 November 2000 to 13 February 2001 in the case of the first defendant and from 13 November 2000 to 13 December 2000 in the case of the second defendant. 2. Each of the first and second defendants deliver up any information, process, papers or documents which they have obtained or had access to in the course of their employment with the plaintiff. 3. The third defendant deliver up any papers or documents which it has obtained by whatever means from the first and second defendants which relate to the plaintiff's business. 4. The third defendant be restrained from using or distributing in any way any information, process, papers or documents which originate from the plaintiff which they have obtained through the first and second defendants. 5. Damages."

15. I now have before me a summons filed on behalf of the plaintiff whereby the plaintiff seeks similar interlocutory injunctive relief to the trial of the proceeding.

18. The affidavits and the exhibits to those affidavits filed on behalf of the parties in support of and in opposition to the application are voluminous. No useful purpose would be served by reciting them in my reasons for judgment, even if I had the time available to do so. I have read those affidavits and exhibits and have taken account of the submissions made to me by counsel for the plaintiff. However, I am not persuaded that in this case it is appropriate to grant the injunctive relief the plaintiff seeks.

21. The courts have invariably refused to grant an injunction the effect of which is to require a person to perform duties as an employee, because to grant one would have the effect of forcing the parties to remain in a close personal relationship which has become obnoxious to them. The matter was adverted to by Kaye, J. in Gordon v. State of Victoria [1981] V.R.235 at 239. His Honour said:

"As a general principle of law, specific performance of a contract of service will not be decreed. The practice of the Court on an application of this nature was stated by Lord Morris of Borth-y-Gest, delivering the judgment of the Privy Council, in Francis v. Municipal Councillors of Kuala Lumpur, [1962] 1 W.L.R. 1411, at pp.1417-1418; [1962] 3 All E.R. 633 as follows: '... when there has been a purported termination of a contract of service a declaration to the effect that the contract of service still subsists will rarely be made. This is a consequence of the general principle of law that courts will not grant specific performance of contracts of service. Special circumstances will be required before such a declaration is made and its making will normally be in the discretion of the court.'"

25. Of course, as his Honour pointed out, special circumstances may exist which require such an order, but in my opinion such circumstances do not exist in the present case.

28. In the case of the first defendant the order seeks to restrain her from working with anyone other than the plaintiff until 13 February 2001, in the case of the second defendant until 13 December of this year, which is only a little more than a week away. The periods of time in question are so short that in my opinion any loss suffered by the plaintiff as a consequence of the absence of the first and second defendants from their employment would be minimal.

31. As to the allegation of misuse of the plaintiff's documents, there is nothing of a confidential nature about the standard form documents exhibited to the second defendant's affidavit. That fact alone, of course, is not conclusive, but I am not persuaded that the use by the first and second defendants of those documents could as a matter of fact be detrimental to the plaintiff. Nor is there any evidence that the third defendant is misusing any documents of the plaintiff. Indeed, in his affidavit of 4 December 2000 the director of the third defendant, Steven Romp, has sworn that he specifically warned the first and second defendants that he did not want any of the plaintiff's documents to be brought across to the third defendant: see paragraphs 7 and 12 of his affidavit. True it is that former clients of the plaintiff may now deal with the third defendant, but that is no basis for granting the injunctive relief now sought.

34. This matter was dealt with by Dr Dean in his book The Law of Trade Secrets. At page 213 the author said:

"The principles upon which the courts distinguish between customer information available to an ex-employee and that which is the ex-employer's trade secret have been enunciated many times. They are predicated upon a conflict between two policy considerations. The first is that the court seeks to uphold contracts between contracting parties and the obligations of confidentiality which have expressly or impliedly been undertaken."

And this in my opinion is pertinent to the present case.

"The second is that the court 'seeks to respect the rights of servants to advance their chosen trade and professions ... promote their own private interest by changing their employment and also to promote the public interest by better use of the servant's personal aptitudes, experience and skill'. An ex-employee is entitled to approach the ex-employer's customers so long as: (i) those customers' names are not trade secrets; (ii) the employee is not in breach of a valid restraint of trade clause; (iii) the employee does not do so by using lists dishonestly removed from the ex-employer or as a consequence of deliberately and dishonestly memorising the ex-employer's clients' names."

40. Finally, if the view I have taken of the matter subsequently proves to be erroneous, it is my opinion that the plaintiff in this case would be adequately compensated by an appropriate award of damages.

43. The plaintiff's summons is dismissed with costs, including reserved costs, to be taxed and paid by the plaintiff.

47. HIS HONOUR: I am not persuaded that I should make any order other than the one I have made.