21 There was some dispute before me as to the ability of the defendant to access the main data base of the plaintiff in order to obtain that information. However, what has emerged, and has been established to my satisfaction, for these purposes, is that a sales consultant cannot only access the main data base for information concerning his own clients, but that he can also access the main data base to obtain the name and suburb of other persons and contacts with whom other sales consultants of the plaintiffs have had dealings.
22 As I have described above, the evidence discloses that the defendant on the cessation of his employment with the plaintiff, wrote a number of letters to persons who were apparently listed on his own individual data base. I have quoted from part of the letter from one of those persons. At the cessation of his employment, apparently the defendant had some 297 such names on his individual data base.
23 Initially there was debate before me as to whether all or any of those persons might be properly described as customers, which the law would protect. The defendant argued that some of those names related to person who had simply been contacted as potential or possible sales. In other words they were mere prospects rather than customers. However, the defendant's own affidavit described the persons on his own data base as clients. More importantly, in the letter that he sent to those persons, and which I have referred to, he thanked those persons for their support, loyalty and referral business that many of them had generated for him throughout the years.
24 The terms of that letter reflected that it was sent to persons on the defendant's individual data base, who the defendant, himself, treated as customers. At this stage of the proceeding the letter is sufficient to show that there is a serious issue that the defendant did have customers with whom he had had contact through his employment with the plaintiff and which the plaintiff, at law, is entitled to protect by appropriate restraint clause.
25 In the course of argument, Mr Angelopolous who appeared for the defendant, recognised the difficulty exposed by the evidence to which I have just referred. Accordingly in the course of his argument he proffered an undertaking not only on behalf of his own clients but also on behalf of Hocking Stuart from whom apparently he has instructions. That undertaking was that for a period of six months from 20 December 2004 they would not canvass, approach or accept any approach from any person on the defendant's individual data base where the property of such a person is within a 10 kilometre radius of the former employment of the defendant at Stephensons Road, Mount Waverley. In my opinion, the defendant was correct in making that concession during argument.
26 The law recognises that an employee may, during his entitlement, forge a relationship with a client or contact or prospective client of his employer, which the employer may protect by appropriate contractual restraint - see Hartleys Limited v Martin;[15] I.F. Asia Pacific Pty Ltd v Simon Galbally & Ors.[16] Thus the plaintiff has established that it has a legitimate interest in the persons with whom the defendant had had contact in the course of his employment, and it is entitled to protect that interest by appropriate contractual restraint.
27 The letter sent by the defendant to persons nominated on his individual data base, and his contact with two such persons in respect of sales of their properties, are sufficient at this level to show that there is a serious issue to be tried in relation to a breach of the restraint. Accordingly, the plaintiff at this stage is entitled interlocutory relief in respect of that aspect of his claim. As I stated, Mr Angelopolous proffered an undertaking on behalf of his client to provide such protection. The plaintiff is not bound to accept such an undertaking. He was entitled to an injunction in those terms which I shall grant in due course.
28 The plaintiff, however, seeks a broader relief than that proffered by the defendant in argument. The plaintiff, first, seeks to enjoin under Clause 22(b)(iii), the defendant from dealing with any person on the plaintiff's own name data base for a period of six months where such person has a residence within 10 kilometres of the defendant's former place of employment. The plaintiff also seeks to restrain the defendant from being employed at all by any competitor of the plaintiff pursuant to Clause 22(b)(i), again within a distance of 10 kilometres of the defendant's former employment, for a period of six months from the cessation of his employment with the plaintiff.
29 Mr D'Abaco who appeared for the plaintiff, contended that the latter restraint is necessary because if the plaintiff were confined for relief under Clause 22(b)(iii), it might at trial have difficulty in proving any damages resulting from a breach of such a clause by the defendant. On the other hand, Mr Angelopolous for the defendant, contended that the restraint sought by the plaintiff does not protect a legitimate interest of the plaintiff recognised by law. Rather, it is said that the restraint is wider than is necessary to protect what might possibly be described as the customers of the plaintiff but is rather a restraint on competition.
30 In order to resolve that dispute I turn again briefly to the evidence. The affidavit of Mr Wartnaby provides very little detail concerning the nature and composition of the six categories of persons which he lists in paragraph 8 and which I have quoted above. The first three categories are described as potential vendors. There is no evidence as to what is meant by the adjective "potential".
31 The first category relates to potential vendors contacted by the plaintiff's tele-canvassers. Little information is proffered as to that category in Mr Wartnaby's affidavit. However, Mr Maxwell, at paragraph 46 of his affidavit, described such contacts as follows.
32 "Tele-canvasser leads are what we call in the industry soft leads. That is, they are leads that we manufactured by way of being proactive. The result is that the majority of these home owners are not ready to sell. They generally just want an idea of the current value of their home or may be thinking of selling in the distant future, and are happy to be given a rough idea of the value in the current market and a guide as to the home's future value. It is extremely rare for one of these leads to he listed within a two to four week period. Some of these soft appraisals take years to come onto the market and the majority (indistinct)."
33 That description and the bare description of persons as potential purchasers, in my opinion, for these purposes, falls well short of what the law understands as customers of an employer which an employer is entitled to protect by appropriate injunctive relief. An estate agent is, of course, in a different category to, for example, a retailer of goods from a shop. His clientele is different of course to such a retailer. However, there is no evidence in this case that any of the names on the main data base of the plaintiff, constituted recurring customers as vendors - there Philip Levy v Christopoulos.[17]
34 I have no doubt that estate agents are, as Mr Wartnaby says, proactive in seeking out persons who might potentially decide to sell at a future date, and if they do so, might potentially engage the plaintiff to effect such a sale. However, as I stated, such persons are very different and are not, in my view, what might be described as customers of a business which a plaintiff employer is entitled to protect by a restrictive covenant.
35 Similar comments may be made in relation to the other three categories of persons on the main data base. The next two are categories of past purchasers - potential purchasers or past purchasers. There is no evidence that they include persons who put recurring business in the hands of the plaintiff. Indeed there is no evidence that any such purchasers engaged the plaintiff, which as I understand it, acts on behalf of vendors.
36 The sixth category, "Other Listing Opportunities" is, in my view, hopelessly vague and imprecise for these purposes. Thus I do not consider that, on the material which has been proffered at this stage, there is a serious issue that the plaintiff has an interest in the categories described in paragraph 8 of Mr Wartnaby's affidavit, which it is entitled to protect by a restrict covenant. On any view the case of the plaintiff in this respect is not strong at all, and certainly is not sufficiently strong to justify the far-reaching restraint which it seeks to have imposed pending trial on the defendant.
37 In addition, there is no evidence that the defendant has dealt with what the plaintiff might describe as its customers, other than those persons with whom he has had contact and who are contained on the defendant's own individual data base. The plaintiff is understandably anxious that the defendant may have had such contact or may be liable to do so, given his conduct in relation to the persons set out on his individual data base, but there is no evidence that the defendant has done so, and not sufficient evidence certainly to establish a serious issue to be tried as to breach.
38 In I.F. Asia Pacific Pty Ltd v Galbally, Dodds-Streeton J noted:[18]