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[2012] NSWSC 1425
mixed. Orders 3 and 4 made on 7 November 2012 continued until further order. The plaintiff's application for other interlocutory relief was dismissed. The plaintiff was ordered to file and serve a statement...
The Court found strong preliminary evidence that the former trainer had used Facebook to attract former clients to the Genesis gyms. The contract prohibited soliciting, canvassing or securing those clients' custom, but the Court did not read it as a ban on providing services to former clients who chose to follow her. Because a broader order would be hard to identify and enforce and could affect people not shown to have been solicited, the Court refused that relief. It also refused to stop the gyms employing or contracting with her. The existing orders preventing further solicitation remained in place while the case proceeded.
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2,168 words · generated 29/09/2026
Planet Fitness Pty Limited applied for interlocutory orders concerning Brooke Dunlop, a personal trainer who had previously contracted to provide training services to Planet Fitness clients. It also sought orders against GFC Warners Bay Pty Ltd and GFC Mayfield Pty Ltd, which operated Genesis gyms in the Newcastle area [1], [4].
No linked legislation citations have been extracted yet.
The agreement was dated 21 June 2010. Clause 3.5 said that, during the agreement and for a “Restraint Period” of three months after termination, Dunlop must not, without written agreement, “solicit, canvass or secure the custom” of defined clients. Those clients included people who had been members of a Planet Fitness-branded gym or attended one while she was providing services under the agreement [2]-[3].
The plaintiff's requested relief included orders against further Facebook communications or other solicitation, an order preventing the Genesis companies from employing or contracting with Dunlop, and an alternative order preventing Dunlop from providing personal training to former clients [1], [12]-[13]. The evidence included Facebook messages in which Dunlop described negotiations with Genesis and offered her personal training clients and other participants a reduced-rate arrangement. Some former clients cancelled their Planet Fitness memberships and took up her services through Genesis [14]-[15].
There was also a threshold uncertainty about who had contracted with Dunlop. The agreement named Planet Fitness Lambton Pty Limited, whereas the plaintiff was Planet Fitness Pty Limited. The Court found a serious question to be tried that the plaintiff was the contracting party and that the agreement's reference to Planet Fitness Lambton Pty Limited was a misnomer [5]-[10].
The result was mixed. The Court continued the existing orders restraining further specified Facebook posts and other solicitation. It dismissed the application for the other interlocutory relief, directed the filing of pleadings, and made different costs orders for Dunlop and the Genesis companies [30]-[32]. This was an interlocutory decision, not a final determination of the contractual dispute.
The Court separated three matters: the apparent solicitation, the meaning of the clause, and the appropriateness of the remedies sought.
First, the Facebook material provided a strong prima facie basis for finding that Dunlop had solicited or canvassed former clients. One post offered an “amazing deal” exclusively for personal training clients, personal contract members and class participants, and invited them to contact Genesis Warners Bay [14]. The evidence also indicated that some of those people moved their memberships and training to Genesis [15]. On this preliminary record, the Court continued orders against further solicitation [27]-[30].
Second, the Court rejected the plaintiff's argument that every continued training session was a continuing act of “securing” custom. It read “solicit, canvass or secure the custom of” as one phrase. In the Court's view, the phrase addressed efforts to attract custom, or the achievement of that attraction, after the agreement ended [18]. The clause did not simply prohibit Dunlop from training former clients. A former client might choose, of their own volition, to continue with the same trainer [19]. The Court added that a contract intended to prohibit provision of services to former clients would need to say so clearly, and that different enforceability questions might then arise [19].
That construction made the distinction between a continuing breach and the consequences of a past breach important. The Court considered that the solicitation could already be complete, except for any new solicitation. The plaintiff's alternative submission was that continuing services themselves repeatedly secured custom, but the Court did not accept that reading [16]-[20]. An injunction restraining future solicitation was different from an injunction stopping Dunlop from serving people who had previously been solicited.
Third, the proposed order against ongoing services presented practical and discretionary problems. The evidence did not clearly establish how many people would fall within the proposed group. Dunlop had taught group classes and personal training sessions, potentially involving hundreds of people. Restricting the order to her Facebook friends would still leave uncertainty about identifying the relevant people [22]. Genesis staff could have difficulty knowing whether allowing someone to train with Dunlop would breach an injunction or assist a breach of contract [23].
The order could also affect former clients who had not been influenced by solicitation and who might have followed Dunlop anyway. Those third parties had not been heard, and the Court considered it impracticable to hear them all [24]. The Court found no clear authority supporting an injunction against the consequences of past solicitation, as distinct from continuing the restraint on the breach itself [21], [25]. Taken together, the scope, enforcement and third-party issues led it to refuse that remedy.
The proposed order preventing Genesis from employing, contracting with or permitting Dunlop to provide services was also refused. The agreement did not make Dunlop's services exclusive to Planet Fitness and contained no restraint on her working elsewhere after termination [11]. The Court considered that, without such a contractual restraint, an injunction against employment simpliciter could not be justified on the basis of protecting goodwill or confidential information [12]. The plaintiff ultimately accepted that the order it had sought was too wide [12], [32].
The judgment does not set out a comprehensive account of the law before the decision, and it does not purport to change the general law. It records no cited authorities. The legal propositions that can safely be attributed to this decision are therefore limited to the Court's reasoning on this interlocutory application.
As applied here, the contract's words mattered. “Solicit, canvass or secure the custom of” were read together, and the Court treated them as directed to attracting former clients' custom. It did not treat them as equivalent to an express prohibition on providing services to former clients [18]-[19]. The Court also drew a remedial distinction between restraining further solicitation and stopping the consequences of completed solicitation [20]-[25].
The decision illustrates the Court's assessment of whether an injunction is workable. It considered the group's uncertain boundaries, the burden of day-to-day compliance, the position of people not before the Court and the difficulty of enforcing the order [21]-[25]. The judgment expressly characterised an injunction as discretionary [25]. It does not establish that these factors always defeat an injunction, or that a particular form of client restraint will necessarily be enforceable.
Nor does the decision determine whether a differently worded clause restraining services to former clients would be enforceable. White J expressly left that question open, noting that such a clause would need to be clearly expressed and might raise different enforceability questions [19]. The Court also did not finally determine the plaintiff's identity as contracting party. It found a serious question to be tried on the evidence before it [9]-[10]. The ultimate contractual and monetary claims remained for later proceedings.
At [9], the Court said there was “a serious question to be tried” that the plaintiff was the contracting party and the reference to Planet Fitness Lambton Pty Limited was a misnomer. In plain English, the mismatch in the company names did not prevent the plaintiff from obtaining the limited interlocutory relief granted, but the question was not finally resolved.
At [18], the Court described clause 3.5 as a restraint on “endeavouring to attract, or achieving the attraction of” former clients' custom. In plain English, the clause targeted efforts to draw clients away, rather than every later interaction between the trainer and a person who had once been a client.
At [19], the Court said a clause that simply barred provision of services to former clients would need to be “clearly so expressed.” In plain English, the Court would not read that broader prohibition into the non-solicitation words that were actually used. The passage does not decide whether a differently drafted service prohibition would be valid.
At [21], the Court identified the proposed service restraint as one directed at the “consequences of former solicitation.” It noted that an order might capture people who were still using Planet Fitness because of solicitation, but the evidence and proposed group presented identification and enforcement problems. In plain English, the Court considered it materially different to stop future approaches than to prevent all service relationships that might have followed earlier approaches.
At [25], the Court concluded that the difficulties of framing and enforcing the order, together with the absence of clear authority identified for that remedy, meant it should not be granted. In plain English, the Court was not satisfied that the proposed order was a suitable discretionary remedy on the material before it.
The formal orders at [30] are important to the scope of the result. Orders 3 and 4 from 7 November 2012 continued until further order, but the rest of the interlocutory application was dismissed. The Court did not decide the final claim for damages, an account of profits, or knowing inducement.
The decision is most directly relevant to an interlocutory dispute with facts resembling those recorded in this judgment: a service provider's contract contains a non-solicitation clause; after the contract ends, the provider communicates with former clients about moving to a competitor; and the former clients begin receiving services through that competitor [3], [14]-[15].
It is particularly relevant where the clause prohibits solicitation, canvassing or securing custom, but does not expressly prohibit employment by a competitor or provision of services to former clients. In that setting, the decision demonstrates why the wording of the actual clause and the distinction between attracting clients and serving them later may matter [11], [18]-[20].
The practical aspects of the proposed injunction are also relevant where the affected class is uncertain, numerous or difficult to identify, and where compliance would require a third party to decide daily whether a particular client falls within an order [21]-[24]. The judgment emphasises that an order may have effects on people who are not parties and may be difficult to administer.
The decision should not be read as resolving every non-solicitation dispute. It concerned an interlocutory application, a particular clause and a particular evidentiary record. It does not decide how a differently worded restraint would be construed, whether such a restraint would be enforceable, or what final remedies would be available after trial.
The judgment supplied for analysis contains no later decisions and identifies no authorities considered by White J. On this material, it is not possible to state how later courts have treated Planet Fitness v Dunlop, whether they have followed or distinguished it, or whether its reasoning has been approved or criticised.
The decision itself identifies no precedent relationship. White J said that no authority had been referred to in support of an injunction against the consequences of former solicitation, and that he had not found one in the limited time available [21]. That observation is confined to the hearing and research described in this judgment. It is not evidence about later case law or a conclusion that no such authority existed elsewhere.
For research use, the narrow propositions to track in any later treatment are the construction of “solicit, canvass or secure the custom” as a whole phrase, the distinction between continuing solicitation and its consequences, and the practical difficulties of an order affecting former clients and third parties [18]-[25]. Whether a later court adopted or departed from those propositions cannot be determined from the supplied judgment.
The most explicit open question is whether a clearly drafted clause prohibiting the provision of services to former clients would be enforceable. White J said that such a clause would need to be clearly expressed and that different enforceability questions might arise, but did not resolve those questions [19].
The identity of the contracting party also remained a trial issue. The Court found a serious question that Planet Fitness Pty Limited was the party and that the name in the agreement was a misnomer, but the evidence before the Court did not include evidence establishing the plaintiff's asserted trustee capacity. The Court noted that further evidence might be provided, but proceeded on the material then available [5]-[10].
The judgment did not decide whether Dunlop ultimately breached the agreement, what monetary relief might follow, or whether Genesis knowingly induced a breach. It said only that the plaintiff would presumably be entitled to damages or an account of profits against Dunlop if its case were established, and that monetary remedies might be available against Genesis if knowing inducement were established [26]. These were possibilities, not final findings.
Finally, the judgment does not determine how a more precisely defined group of clients, stronger evidence of the effect of solicitation, or a different proposed order would affect the discretionary analysis. It records why the particular proposed relief was considered difficult to frame and enforce, but does not prescribe a universal result for differently framed injunctions [21]-[25].
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Judgment 1HIS HONOUR: The plaintiff moves for the interlocutory relief sought in paras 8 to 10 of the summons. As I understand the position, the first defendant, without admissions, does not oppose an order being made in accordance with para 8 for a period of seven days, nor an order in the form of para 9 for a period of seven days. However, the second and third defendants resist an order in terms of para 9. All defendants oppose order 10. 2The plaintiff seeks to enforce clause 3.5 of an agreement dated 21 June 2010, which the plaintiff says was made between it and the first defendant. The first defendant, by that agreement, agreed to provide services of a personal trainer to the entity named in the agreement as "the Company". The agreement recites that "the Company" is engaged in operating a business running a gym located in Turton Road, Lambton. 3Clause 3.5 provides: "Restraint of Trade: During the term of this agreement and during the Restraint Period, the Contractor must not directly or indirectly or through any interposed entity (including a corporate vehicle, trust or partnership) without the prior written agreement of the Company, solicit, canvass or secure the custom of any person who is the Company's client. In this clause: (a) 'Client' means a person who has been a member of the Company (or any other 'Planet Fitness' branded gym) or otherwise attended any 'Planet Fitness' branded gym at any time whilst the Contractor is providing the Services under this agreement; and (b) 'Restraint Period' means a period of three months after this agreement is terminated. This clause survives termination of this agreement." 4The second and third defendants operate gyms (or so it can be inferred) at Warners Bay and Mayfield. All of these locations are in the Newcastle area. The second and third defendants trade under the name Genesis. 5There is an issue as to whether the plaintiff is a party to the agreement which it seeks to enforce. The company named in the agreement is Planet Fitness Lambton Pty Limited ABN 17 350 760 994. The plaintiff is Planet Fitness Pty Limited ACN 073 563 489. The director, or a director, of the plaintiff, Mr Rosekelly, deposes that the plaintiff operates a fitness gym at Lambton in Newcastle that trades as Planet Fitness. That is consistent with the business described in the agreement as the business carried on by "the Company". Mr Rosekelly deposes that: "In around June 2010 we took steps to have all our personal trainers sign Independent Contractor Agreements. At this time Planet Fitness held a meeting with all our personal trainers ... and talked through the agreement. ... Brooke [Dunlop, the first defendant] signed her agreement with Planet Fitness on 21 June 2010." 6Mr Rosekelly then annexes what he says is the copy of the Independent Contractors Agreement. 7A business name search of ABN 17 350 760 994 discloses that there is an entity with that ABN which is "the trustee for Planet Fitness Trust". The entity type is described as "Discretionary Trading Trust". 8There is no evidence that Planet Fitness Pty Limited is the trustee of a discretionary trading trust. I was told by counsel for the plaintiff that such evidence could be provided, but no adjournment was sought in that respect, except that counsel suggested that evidence on this question could be provided this afternoon. I expressed doubt as to whether that would give the defendants sufficient time to deal with the question. The defendants have urged me to deal with the matter on the basis of the evidence with which the plaintiff came to court, and I think I should do so. 9Having regard to the description in Mr Rosekelly's affidavit of the business of the plaintiff, and the correspondence of that description of the plaintiff's business with the business of "the Company" in the agreement, coupled with Mr Rosekelly's evidence that the agreement was in fact made between the plaintiff and the first defendant, I am satisfied that there is a serious question to be tried that the plaintiff is the contracting party with the first defendant and that the reference to Planet Fitness Lambton Pty Limited is a misnomer. Indeed, I was told by counsel for the second and third defendants that his searches had not revealed the existence of such an entity. 10If it is indeed the fact that the plaintiff is the contracting party then I can infer that it contracted in its capacity as trustee for a discretionary trading trust. Given that the trust is described as being a trading trust, I do not think there is any real question likely to be raised that its business, the goodwill of which is entitled to protection, would be any different from that described in the contract. 11The first defendant was engaged by the plaintiff as an independent contractor to provide the services of a personal trainer to clients of the plaintiff. The agreement does not provide for the first defendant to provide such services exclusively to the plaintiff. Nor is there any restraint on the plaintiff's providing services as a personal trainer to others after the agreement comes to an end. 12The relief sought in order 10 of the summons was for an order that the second and third defendants be restrained from employing, otherwise contracting with or permitting the first defendant to provide fitness training services or personal training services. Such an order would be too wide, as I think was ultimately accepted in the course of the plaintiff's submissions in reply. Whilst a contractual restraint of employment can be justified by the need to protect goodwill or confidential information and the difficulties of detecting breaches of obligations against solicitation or against disclosure of confidential information, I do not think that in the absence of such a contractual restraint against employment, an injunction against employment simpliciter could lie. 13In the alternative to that order the plaintiff sought an order restraining the first defendant from providing personal training services to persons who had been her clients when she worked for the plaintiff. Such persons were in fact clients of the plaintiff, but in a sense they would also have been clients of the first defendant. 14There is a strong prima facie case that the first defendant has solicited or canvassed persons for whom she provided personal training services when she was contracted to the plaintiff. She did so by posting messages on her Facebook page in which, amongst other things, she advised her Facebook friends that, first, she was in negotiation, and later that she had negotiated arrangements, with Genesis (that is, the second and third defendants), whereby those persons would be able to train at Genesis clubs at a reduced rate for the remaining periods of their contracts with the plaintiff. One of those messages stated: "I have negotiated an amazing deal exclusively for any of my PT [personal training] clients, PC members and Class participants. Please call Sean and the guys at GENESIS Warnersbay [sic] NOW ... All you need to do is mention my name and show your current membership tag ..." 15It is unnecessary to detail the various messages which at least prima facie strongly point to the first defendant having solicited and canvassed her former clients. It is clear from the extracts from her Facebook pages that many of her former clients, when she was contracted with the plaintiff, were amongst the first defendant's Facebook friends. The evidence also establishes that a number of those persons have cancelled their membership with the plaintiff and taken up the services of the first defendant through the gyms of the second and third defendants. 16The difficult question is what, if any, injunctive relief should follow as a consequence of those prima facie breaches. If the covenant in clause 3.5 is construed as being entirely a restraint against the first defendant's attempting to bring her former clients to her in a new position, then it can be said that the breach is complete, except in respect of any new acts of solicitation or canvassing. The question would then arise whether an injunction could be granted to restrain the consequences of the breach, that is, to restrain the first defendant from providing ongoing personal training services to those who have been so attracted. 17Counsel for the plaintiff said that it was not necessary to go so far. He submitted that the restraint against securing the custom of any person would be breached on an ongoing basis by the continuing provision of personal training services to such persons. He submitted that when personal training services were first provided to those persons in the second and third defendants' gyms, the first defendant would then have secured their custom, and that there would be continued acts of securing the custom by the continued provision of services. Hence the acts of providing services to such people would be continuing breaches of clause 3.5 which could be restrained. 18I do not think that that is the proper construction of clause 3.5. I agree with the submission of counsel for the second and third defendants that the words "solicit, canvas or secure the custom of" have to be read as a whole phrase and that each word in it gives sense to what is restrained. I agree that, considered as a whole, the clause is a restraint against endeavouring to attract, or achieving the attraction of, custom of the former clients of the first defendant, after her contract with the plaintiff had been terminated. 19 A clause which was intended simply to restrain the first defendant from providing services to former clients would need to be clearly so expressed. Different questions might then arise as to the enforceability of such a clause. I think the clause is one directed against soliciting and was not intended to deal, for example, with the case where a former client of his or her own volition wished to continue to use the first defendant as his or her personal trainer. 20It follows in my view that an injunction could only be granted, at the most, which restrained future solicitation, (which is not the matter in issue), and which sought to restrain the consequences of former solicitation. 21I was not referred to any authority to support the grant of an injunction to achieve the latter end. In the limited time available I have not myself found such an authority. An injunction which addressed the consequences of former solicitation would have to be framed so as to restrain the first defendant from providing her services as a personal trainer to her former clients that she had when she was contracted to the plaintiff, and who were or are her Facebook friends. In respect of those people one could infer that there is a real likelihood, although not a certainty, that they are still engaging the plaintiff because of her acts of solicitation or canvassing. But such an injunction would be very difficult to enforce and would create problems not only for the first defendant, but the second and third defendants. True it is that the second and third defendants have themselves been actively soliciting people's custom on the first defendant's Facebook page. But there is no evidence that at the time that was done they had knowledge of clause 3.5. That is to say, there is no evidence that they had knowledge that they may have been assisting the first defendant to breach her contract. 22The evidence is not entirely clear as to how many people might fall into the category of those who should be restrained. Mr Rosekelly deposes that the first defendant would have had contact with between 50 to 70 members at each group class and on average took between six and eight classes each week. He said that she would train on average approximately 20 to 30 members each week at personal training sessions, either one-on-one or in group classes. There are thus possibly some hundreds of people, depending on how many times people attended a group or personal class, who might be the subject of the order. That could be limited by putting those people into the subgroup of Facebook friends of the first defendant, but it is not clear how that subclass could be identified. 23There would be a real difficulty on a day-to-day level in the employees of the second and third defendant who run their gyms knowing whether, if they allowed persons to be trained by the first defendant, they would then be assisting in a breach of an injunction, or inducing a breach of contract. 24A further difficulty is that an injunction so framed would obviously affect third parties, namely, those who would want to use the first defendant's services. Those persons have not been heard and it would not be practicable to hear them. There may well be many such persons who were unaffected by the solicitation of the first defendant and who would have followed her in any event. 25An injunction is a discretionary remedy. The difficulties of both framing an injunction and enforcing it, as well as the absence of any clear authority that an injunction against the consequences of the prima facie breach, as distinct from continuance of the breach, would be justifiable, lead to the conclusion that I ought not to grant such a remedy. 26The plaintiff, if it establishes its case at trial, will presumably be entitled to damages or an account of profits against the first defendant. If it establishes a case of knowing inducement of a breach of contract against the second and third defendants, it will be entitled to monetary remedies against them. 27In my view the orders that I ought to make are to continue the orders that I made ex parte on 7 November 2012 restraining the first defendant from posting any new messages on her Facebook page of the kind referred to in order 3 or from otherwise soliciting, canvassing or securing the custom of persons who were clients of the plaintiff during the relevant periods. 28The solicitors for the first defendant have advised that, without admission, the offending Facebook posts have now been removed and I do not understand any further order to require that to be done is now sought. 29Subject to hearing from counsel as to the appropriate form of order I think the orders should be that orders 3 and 4 made on 7 November 2012 be continued until further order, and then to direct pleadings, and to stand the matter over to the Registrar's list for directions so that the plaintiff's claim for final relief can come forward. [Counsel addressed.] 30I make the following orders: 1.Order that orders 3 and 4 made on 7 November 2012 continue until further order. 2.Order that the plaintiff's application for interlocutory relief in the summons be otherwise dismissed. 3.Order that the plaintiff file and service a statement of claim by 16 November 2012 and that the defendants file and serve their defences and any cross-claim by 28 November 2012. 4.Stand the matter over to the Registrar's list on 30 November 2012. [Counsel addressed on costs.] 31I think that separate costs orders should be made in respect to the first defendant on the one hand and the second and third defendants on the other. The first defendant has consented to the orders which I have continued in substance and was successful in her opposition to the further orders that the plaintiff sought today. On the other hand, at a final hearing it might be determined that the plaintiff should have been entitled to interlocutory relief against the first defendant. In those circumstances I think the appropriate order is that the costs of today be the first defendant's costs in the proceedings. 32So far as the costs of the second and third defendants are concerned, the real issue was the order sought in para 10 of the summons that would have restrained the second and third defendants from employing, or contracting with, or permitting the first defendant to provide fitness training or personal training services. In the end it was acknowledged that that order was too wide. The second and third defendants' opposition to that order was entirely justified. Further, although there is a strong prima facie case that this interlocutory application has been brought about by breaches by the first defendant of the contract, there is no such strong prima facie case against the second and third defendants. I think in those circumstances the appropriate order is that the plaintiffs pay the second and third defendants' costs of today. I make those orders. DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 23 November 2012
Planet Fitness Pty Limited
Brooke Dunlop & Ors
Orders 3 and 4 made on 7 November 2012 continued until further order. The plaintiff's application for other interlocutory relief was dismissed. The plaintiff was ordered to file and serve a statement of claim by 16 November 2012, with defences and any cross-claim due by 28 November 2012. The matter was stood over to the Registrar's list on 30 November 2012. The first defendant received the costs of the day as costs in the proceedings, and the plaintiff was ordered to pay the second and third defendants' costs of the day [30]-[32].