Network Ten Pty Ltd v Seven Network

Introduction 1The second defendant, Mr John Stephens, is an experienced and highly regarded television programming executive. He is now 67 years of age and has worked in the Australian television industry for over 40 years. 2Since February 2013, Mr Stephens had been an employee of the first defendant, Seven Network (Operations) Ltd ("Seven"), as a Programming, Strategy and Acquisitions Consultant pursuant to an employment contract dated 29 January 2013 ("the 2013 Seven Agreement"). Prior to February 2013, Mr Stephens was Head of Programming, Strategy and Acquisitions at Seven, and prior to that Director of Programming at the Nine Network. 3The term of the 2013 Seven Agreement was to expire on 31 January 2015, but was terminable by either party in the meantime on three months' notice in writing. 4On 6 March 2014, Mr Stephens executed an "Employment Agreement" with the plaintiff, Network Ten Pty Ltd ("Ten") pursuant to which Ten appointed Mr Stephens as "Director of Scheduling and Acquisitions" at Ten from 9 June 2014 for an "Initial Term" of two years ("the Ten Agreement"). 5On 6 March 2014, and again on 7 March 2014, Mr Stephens served on Seven a notice resigning from Seven, and thus terminating the 2013 Seven Agreement. 6By 9 March 2014, Mr Stephens had changed his mind. On 10 March 2014 he told Ten that he would "not be commencing employment" with Ten and withdrew his resignation from Seven "effective immediately". On the same day Mr Stephens executed a document entitled "Your Continuing Employment with [Seven]" ("the 2014 Seven Agreement") which confirmed that Mr Stephens had withdrawn his resignation and stated that Mr Stephens "will be employed by Seven in the position of Head of International Development". 7In these proceedings, Ten alleges that Mr Stephens' conduct constituted a breach of the terms of the Ten Agreement and that Seven has "intentionally interfered" with the Ten Agreement. Ten seeks declaratory and injunctive relief against both Mr Stephens and Seven. 8The injunctive relief sought against Mr Stephens is that he be restrained from: "(a) soliciting, encouraging or accepting any offers of employment from, or offers to provide services to Seven (or its related bodies corporate), where that employment or services includes the employment or services on any date between 9 June 2014 and before 8 June 2016, unless Ten consents; (b) negotiating any offer of employment with Seven (or its related bodies corporate) that includes employment provided on any date between 9 June 2014 and 8 June 2016; (c) negotiating any offer of services with Seven (or its related bodies corporate) that includes services provided by Mr Stephens on any date between 9 June 2014 and 8 June 2016; (d) being employed, acting as agent or being a contractor for Seven (or its related bodies corporate), on any date between 9 June 2014 and 8 June 2016, unless Ten consents." 9In effect, Ten seeks to restrain Mr Stephens from working at Seven for two years commencing 9 June 2014. 10Ten does not seek damages from either Mr Stephens or Seven. It amended its Statement of Claim during the hearing to abandon a claim for damages. Ten seeks declaratory relief in respect of the Ten Agreement and the 2013 Seven Agreement. 11Ten called two witnesses; its Chief Executive Officer, Mr Hamish McLennan and its Head of Human Resources, Mr Graeme Kethel. 12Mr Stephens did not give evidence and Seven called no other witness. It is clear from the documentary evidence that a number of senior executives at Seven (not least, Mr Stephens) have actual knowledge of matters relevant to the issues in these proceedings. As I explain below, in those circumstances I have assumed the evidence of those individuals would not have assisted Mr Stephens or Seven (see Jones v Dunkel (1959) 101 CLR 298) and have drawn inferences accordingly. 13As all events in this case occurred this year I will, from now on, refer only to the day and month of relevant events. 14I have been greatly assisted by the oral and written submissions received from Mr Studdy SC, who appeared with Ms Mirzabegian for Ten, and Dr Bell SC, who appeared with Mr Thomas for Seven. Much of what follows is drawn, with gratitude, from those submissions.