Case Law[2025] ZAWCHC 414South Africa
Inospace Services (Pty) Ltd v Morris and Another (2025/124057) [2025] ZAWCHC 414 (8 September 2025)
Headnotes
Summary: Restraint of trade – First respondent resigning from the applicant’s employment – First respondent soliciting the applicant’s clients to do business with his new employer, the second respondent. Applicant seeking interim interdict - Effect of the interdict final in effect - First and second respondents interdicted and restrained from soliciting applicant’s clients.
Judgment
begin wrapper
begin container
begin header
begin slogan-floater
end slogan-floater
- About SAFLII
About SAFLII
- Databases
Databases
- Search
Search
- Terms of Use
Terms of Use
- RSS Feeds
RSS Feeds
end header
begin main
begin center
# South Africa: Western Cape High Court, Cape Town
South Africa: Western Cape High Court, Cape Town
You are here:
SAFLII
>>
Databases
>>
South Africa: Western Cape High Court, Cape Town
>>
2025
>>
[2025] ZAWCHC 414
|
Noteup
|
LawCite
sino index
## Inospace Services (Pty) Ltd v Morris and Another (2025/124057) [2025] ZAWCHC 414 (8 September 2025)
Inospace Services (Pty) Ltd v Morris and Another (2025/124057) [2025] ZAWCHC 414 (8 September 2025)
Download original files
PDF format
RTF format
make_database: source=/home/saflii//raw/ZAWCHC/Data/2025_414.html
sino date 8 September 2025
SAFLII
Note:
Certain
personal/private details of parties or witnesses have been
redacted from this document in compliance with the law
and
SAFLII
Policy
IN
THE HIGH COURT OF SOUTH AFRICA
WESTERN
CAPE DIVISION, CAPE TOWN
Case
No: 2025-124057
In
the matter between:
INOSPACE
SERVICES (PTY) LTD
Applicant
and
RYAN
JAMES MORRIS
First Respondent
STACK
ONE FULFILLMENT (PTY) LTD
Second Respondent
Neutral
citation:
Inospace Services v
Ryan James Morris and Anoth
er (Case no124057/2025) [2025]
ZAWCHC…(08 September 2025)
Coram:
LEKHULENI J
Heard:
19 May 2025
Post
hearing submissions: 15 and 29 August 2025
Delivered:
Electronically on 08 September 2025
Summary
:
Restraint of trade – First respondent resigning from the
applicant’s employment – First respondent soliciting
the
applicant’s clients to do business with his new employer, the
second respondent. Applicant seeking interim interdict
- Effect of
the interdict final in effect - First and second respondents
interdicted and restrained from soliciting applicant’s
clients.
JUDGMENT
LEKHULENI
J:
1.
Introduction
[1]
This is an application to enforce a restraint of trade agreement. The
applicant brought
this application on an urgent basis seeking an
order that a rule nisi be issued, calling upon the respondents and
all interested
parties to show cause, if any, on a date to be
determine by the this Court why an order should not be granted
restraining and interdicting
the first respondent for a period of 12
months commencing on 01 July 2025, from breaching the covenant in
restraint of trade he
concluded with the applicant by directly or
indirectly, soliciting business in respect of fulfilment services
from any person who
was a client of the applicant during the first
respondent's employment with the applicant or was a prospective
client of the applicant
at the termination of the first respondent's
employment being 30 June 2025.
[2]
The applicant also seeks an order that the first and second
respondents be interdicted
and restrained for 12 months from
canvassing or soliciting business or attempting to do so in respect
of fulfilment services, particularly
from Ecomignite and Repcillen,
who were clients or customers of the applicant during the first
respondent's employment with the
applicant.
2.
The Parties
[3]
The applicant is Inospace Services (Pty) Ltd, a private company with
limited liability
duly incorporated in accordance with the Company
Laws of the Republic of South Africa under registration number
2017/308733/07,
with its registered office situated at The Block,
5[…] W[…] Street, Cape Town, Western Cape.
[4]
The first respondent is Ryan James Morris, an adult male who
currently resides in
Tamboerskloof, Cape Town, Western Cape. The
second respondent is Stack One Fulfilment (Pty) Ltd, a private
company with limited
liability, duly incorporated in accordance with
the Company Laws of the Republic of South Africa under registration
number 2025/418438/07.
The second respondent is a newly incorporated
company, having been registered on 26 May 2025.
3.
The applicant’s case
[5]
The applicant's group of companies has various business divisions
operating across
Southern Africa, which include providing a variety
of property, logistics and business services. The applicant asserts
that its
fulfilment division was established in 2023, and it is the
group's fastest-growing service business. The applicant states that
fulfilment services encompass the end-to-end process involved in
managing e-commerce customer orders on behalf of third parties,
from
the moment an order is placed to the final delivery of the product.
This includes receiving the order, storing inventory,
picking and
packaging the merchandise, and arranging shipping to the customer.
Fulfilment services enable small to medium-sized
e-commerce retailers
to outsource their warehousing and distribution needs, capabilities
that were traditionally only accessible
to large retailers with the
capital to operate their own bulk storage and distribution
facilities.
[6]
The applicant asserted that it has invested in a rigorous system of
employing and
then training its employees. Once employed, the
applicant systematically educates and nurtures its employees. Its
employees learn
how the industry operates and the business methods
and systems that enable them to succeed. Furthermore, the applicant
asserted
that it cannot train and educate its employees effectively
without exposing them to confidential information at the core of its
business and without introducing them to its customer and supplier
base, which forms part of the goodwill of the business. For
this
reason, the applicant requires its employees to sign a restraint of
trade agreement that is operative for a period of 12 months
as a
condition of their employment.
[7]
The first respondent commenced his employment with the applicant on
01 February 2021.
As an employee, the first respondent was trained
and upskilled by the applicant. He was ultimately promoted to the
head of the
fulfilment division, a senior position in the applicant,
with full management authority, including the authority to hire and
dismiss
employees. Prior to his employment with the applicant, the
applicant stated that the first respondent had no exposure to
fulfilment
services, supply chain management, e-commerce and the
logistics industry. According to the applicant, the skills and
knowledge
the first respondent gained were instilled during the first
respondent's employment with the applicant.
[8]
The restraint of trade incorporated in the first respondent’s
employment contract
records that the first respondent would, through
his employment, gain in-depth knowledge of the confidential
information and protectable
interest of the applicant and that he
will be exposed to clients and suppliers of the applicant. He will
have the opportunity to
forge business links with such parties. For
this reason, the applicant contended that by the first respondent's
signature on his
employment agreement, he agreed that if he were to
take up employment with or become associated with a competitor of the
applicant,
the applicant's protectable interests would be prejudiced.
[9]
In this regard, the first respondent's employment agreement recorded
that the first
respondent would be required to agree to the restraint
of trade. The applicant asserts that the first respondent agreed
freely,
voluntarily, and recognising that such restraint would not
cause him any hardship that he is not willing to bear. The restraint
of trade was for a period of 12 months from the date of termination
of the first respondent's employment with the applicant.
[10]
Additionally, the restraint of trade agreement also provided that any
threatened or actual breach
thereof may result in an interdict
proceeding being launched to enforce the terms of the covenant, in
which event the first respondent
would be liable for costs incurred
on an attorney and client scale. The relevant part of the of the
restraint of trade agreement
stipulated as follows:
‘
Irrevocably and
unconditionally agree and undertake in favour of the company that
[he] shall not within the territory, during [his]
employment with the
company and/or during the restraint period directly or indirectly,
either solely or jointly, whether as proprietor,
partner, director,
shareholder, employee, consultant, contractor, financial, agent,
representative:
12.2.1 carry on, assist,
or otherwise be employed, engaged or concerned or interested in any
person, firm, company, close cooperation,
or entity which is in
direct competition with the company; and
12.2.2 canvas or solicit
(or attempt to do any of the aforegoing) business in respect of the
prescribed services from prescribed
clients.’
[11]
On 29 May 2025, the first respondent submitted his letter of
resignation to the applicant. His
final day of employment was
scheduled to be 30 June 2025. According to the applicant, due to the
seniority of the first respondent
at the applicant’s business,
it was mutually agreed that the first respondent should be placed on
gardening leave during
his notice period, which commenced on 13 June
2025, following a small farewell celebration at the applicant's
offices. The applicant
contends that although the first respondent
last rendered services to the applicant on 13 June 2025, his period
of employment formally
ended on 30 June 2025 after his notice had
come to an end.
[12]
On 13 June 2025, the first respondent sent a WhatsApp message to the
applicant's Chief Executive
Officer (Mr Levitt) and appreciated the
opportunity he was given and thanked the applicant for learning a lot
whilst employed by
the applicant. On 27 June 2025, Mr Weber, a former
employee of the applicant, sent Mr Levitt a WhatsApp message
informing him that
he had become involved in a new venture operating
in the fulfilment space, which would be headed up by the first
respondent.
[13]
I pause to mention that Mr Weber was the former Chief Operating
Officer of the applicant and
had been intricately involved in setting
up the applicant's fulfilment division before his resignation in
2023. Mr Weber had brought
the first respondent to the applicant in
2021. He appointed the first respondent to work in the fulfilment
business of the applicant.
[14]
Mr Venske the Group Operations Manager of the applicant who deposed
to the founding affidavit
asserted that upon receiving the message
from Mr Weber, he learned for the first time that the first
respondent intended to pursue
employment in the fulfilment industry,
thereby directly competing with the applicant. Additionally, the
first respondent had not
previously communicated his intention to
participate in a rival business venture upon his resignation. On 30
June 2025, Mr Levitt,
applicant’s CEO and the first respondent,
met to discuss the effect of the restraint of trade agreement in the
first respondent's
employment contract. At that meeting, the first
respondent requested that the applicant relax the restraint of trade
so that a
competitor could employ him.
[15]
In addition, the first respondent explained that he had no intention
of soliciting the applicant's
staff and clients. The applicant
contends that Mr Levitt, in good faith and because he genuinely took
an interest in advancing
the first respondent's career, indicated to
the first respondent that, in principle, the applicant would be
willing to agree to
relax the terms of the restraint of trade subject
to certain conditions. Those conditions were subsequently
communicated to the
applicant through a WhatsApp message. The first
condition was that the first respondent or any business with which he
is associated,
whether directly or indirectly, is prohibited from
employing, attempting to employ, or engaging with current employees
of the applicant
during the restraint period, regardless of who
initiates the contact.
[16]
The second condition was that the first respondent or any associated
entity is not permitted
to solicit or provide services to any
existing clients of the applicant, leads or prospects that were in
the applicant's pipeline
during the first respondent's employment.
The third condition was that the first respondent or any associated
entity may not engage,
contract or utilise the applicant's suppliers
that hold proprietary or strategic value, specifically Mintsoft, the
applicant's
warehouse management system provider.
[17]
In response, the first respondent confirmed that he will not approach
or solicit any of the applicant's
current clients known to him from
his time at the applicant's employment. However, the first respondent
added that if a former
client independently approaches him more than
four months after ending their relationship with the applicant during
the period
of 12 months from 1 July 2025, he proposed that they be
free to consider working with such a client, as he did not believe
that
would result in any prejudice to the applicant. The first
respondent further assured the applicant that he has no intention of
replicating or exploiting any proprietary or strategic arrangements
unique to the applicant. Mr Levitt accepted the counterproposal
and
promised to formalise it in a letter.
[18]
After that, on 8 July 2025, the applicant's head of human resources
sent a written draft agreement
to the first respondent encapsulating
the agreement reached between the parties foreshadowed above. Amongst
others, the proposed
agreement recorded that the applicant was
prepared to relax the restraint of trade agreement and that with
effect from 1 November
2025, the first respondent may engage with
prior clients of the applicant who approached the first respondent
independently within
the 12-month window period provided that there
is no direct or indirect solicitation of the clients. This
entitlement would take
effect from 1 November 2025. The agreement
also stipulated that a breach of the agreement would result in the
full restraint outlined
in the first respondent's employment contract
becoming binding.
[19]
In response to the formal written agreement, the first respondent did
not agree with the suggestion
that a breach of the new agreement
would trigger the full restraint enclosed in his employment contract.
The first respondent also
proposed that he could engage with prior
clients from 1 November 2025, in the absence of any solicitation.
Notwithstanding, the
applicant asserted that on Friday, 18 July 2025,
while considering the first respondent's counterproposal, the
applicant learned
that its second-largest fulfilment client,
Ecomignite, was using the fulfilment services of the second
respondent instead of the
applicant.
[20]
It also came to the applicant's knowledge that at least one other
existing customer of the applicant,
Repcillen, was now using the
fulfilment services of the second respondent instead of the
applicant. This change occurred after
the second respondent, the
first respondent's new employer, approached the customer.
[21]
The applicant also explained an incident involving one of its
business clients, Ecomignite. According
to the applicant, this
company has been doing business with the applicant almost since the
inception of its fulfilment division.
The applicant explains that on
7 May 2025, the head of Ecomignite, Mr Rayne Roselt, sent an email to
the first respondent, who
was still employed by the applicant, and to
Mr Levitt, pointing out that another competitor in the fulfilment
industry had offered
his business better rates. Mr Roselt concluded
the email by requesting a review of the rates that the applicant was
offering him.
[22]
The applicant further asserted that at that time, the first
respondent convinced Mr Levitt to
let him manage Mr Roselt because of
his close working relationship with the latter. The first respondent
scheduled a meeting with
Roselt for 9 May 2025. According to the
applicant, the first respondent indicated to Mr Levitt that it will
be better if Mr Levitt
does not attend the meeting. The first
respondent promised to handle Mr Roselt on his own and advised Mr
Levitt that he (first
respondent) felt a face-to-face meeting between
him and Mr Roselt would likely yield the best results. The first
respondent attended
the meeting with Mr Roselt and later reported to
Mr Levitt that the meeting had been a success and that Mr Roselt
would remain
a client of the applicant.
[23]
Shortly thereafter, on 2 June 2025, days after the first respondent
had resigned, Mr Roselt emailed
the first respondent and Mr Levitt to
inform them that Ecomignite would be terminating its business
dealings with the applicant,
effective from the end of June 2025. The
applicant contends that at that time, it had no reason to suspect
that the first respondent
had anything to do with Mr Roselt's
decision to take the business of Ecomignite to a competitor. However,
on 17 July 2025, Mr Venske
of the applicant arranged for a package to
be purchased from Ecomignite online. This purchase reflected that the
second respondent
was the fulfilment service provider for the order.
After that, the applicant discovered that the second respondent,
Stack One,
employed the first respondent.
[24]
The applicant further contended that, due to the close relationship
between the first respondent
and Mr Roselt and based on the meeting
that took place on 7 May 2025, it was an unavoidable conclusion that
the first respondent
had engineered for Mr Roselt and Ecomignite to
move their business to Stack One his new employer. In addition, the
applicant asserted
that it is undoubtedly so that the first
respondent had been negotiating with Mr Levitt in bad faith when he
made an undertaking
not to solicit the applicant's clients and
suppliers. The applicant stated that it has also since learned that
another of its clients,
Repcillen, has commenced using Stack One
instead of the applicant.
[25]
The applicant asserts that Mr Weber and one Jon Goodman are the
directors of Stack One, which
was registered on 26 May 2026, three
days before the first respondent resigned from the applicant. The
applicant further postulated
that these facts lead to the conclusion
that the first respondent must have been complicit with Mr Weber in
the incorporation of
the second respondent before he resigned from
the applicant and that Mr Goodman's directorship of Stack One (second
respondent)
was designed to conceal the first respondent's
involvement in Stack One to avoid scrutiny. In the applicant’s
view, the second
respondent is essentially a special-purpose tool
being used by the first respondent and Mr Weber to establish a
business that competes
with the applicant.
[26]
The applicant submitted that competition is healthy, but it must be
lawful. What the first respondent,
Mr Weber and the second respondent
have done is unlawful. The applicant’s version is further that
Mr Weber signed an almost
identical restraint of trade when employed
with the applicant and employed the first respondent as his reporting
manager when he
was still with the applicant. The applicant also
noted that Mr Weber and the first respondent are good friends. In the
applicant’s
view, Mr Weber and the first respondent have
conspired to mask the first respondent’s involvement in second
respondent and
schemed to undermine and prejudice the applicant's
business.
[27]
In the applicant's opinion, the second respondent is not an innocent
employer whose new employee
concealed the fact that he was subject to
a restraint of trade. Instead, the second respondent is the tool that
was established
by Mr Weber and the first respondent to try to
circumvent the restraint of trade. The applicant opined that the
second respondent
is clearly complicit in the first respondent's
unlawful conduct, in breach of their restraint of trade, and is
benefiting from
the first respondent's unlawful solicitation of the
applicant's client. The applicant prayed that an order be granted as
prayed
in the notice of motion, as the applicant is at risk of losing
further clients through the first respondent's unlawful conduct if
an
interdict is not granted.
4.
The first respondent’s case
[28]
The first and second respondents opposed the applicant's application
and raised some preliminary
points. The first respondent disputed
that he approached or solicited the applicant's clients. The first
respondent pointed out
that two clients, Ecomignite and Repcillin,
are mentioned in the applicant's application to the effect that that
the first and
second respondents may not deal with these clients. The
first respondent postulated that these clients have a direct and
substantial
interest in the grant or refusal of the relief sought by
the applicant. Yet, they have not been cited in these proceedings.
The
two respondents take the view that this is a material non-joinder
of Ecomignite and Repcillin, and the relief sought by the applicant
is accordingly incompetent.
[29]
The first respondent asserted that the applicant complains volubly
about the loss of clients,
namely Ecomignite and Repcillin, who are
properly regarded as former clients of the applicant and who will not
return to the applicant,
regardless of the circumstances. In the
first respondent's view, the applicant has no protectable interest in
these former clients
and no legitimate basis for the interdict
sought. The first respondent points out that the nature of the
fulfilment business that
the applicant seeks to protect is
straightforward, and there are no trade secrets or confidential
information involved in setting
up such a business. The first
respondent contends that the generalised and unsubstantiated
assertions made in support of the application
are either misleading
or simply false, as underscored by the fact that many companies offer
fulfilment services on an identical
or substantially similar basis to
the applicant.
[30]
In addition, the first respondent pointed out that, in terms of Rule
41A of the Uniform Rules
of Court, there is a peremptory requirement
that an applicant serve a notice in which it is given a binary
choice: it must indicate
whether it agrees to or opposes the referral
of the dispute to mediation. No such notice was served at the time
the application
was served on the respondents on 28 July 2025. The
first respondent contends that it would not be appropriate to
dispense with
the filing of a Rule 41A notice in this matter, as the
parties are not far apart from settling.
[31]
In filing the notice to oppose, the respondents delivered a Rule 41A
notice in terms of which
they agreed to formal mediations of the
matter. At the request of the respondents’ legal
representatives, the applicant filed
a Rule 41A notice with a proviso
that the applicant does not object to referring the matter to
mediation, subject to the interim
relief sought by the applicant
pending the commencement and outcome of any mediation. The
respondents objected to the applicant's
request as they opined that
there will be no real incentive for the applicant to participate
meaningfully in a mediation process
if the interim relief is granted
before mediation.
[32]
Furthermore, the respondents challenged the urgency with which this
application was brought.
They contended that the application was
launched on 28 July 2025 and set down for hearing on 1 August 2025.
The respondents were
required to file their opposition to the
application by 10h00 on Tuesday, 29 January 2025. The respondents
aver that they were
required to file their answering affidavits by
12h00 on Thursday, 31 July 2025, two days after entering their
notices to oppose
the application and less than one day before the
matter is set down for hearing.
[33]
According to the respondents, the applicant has contemplated this
application since 18 July 2025
and instructed its legal
representatives to draft the application over the 8 days period
between 20 July and 27 July 2025. Despite
this, it has afforded the
respondent less than three days to file answering papers. The
respondents asserted that this matter is
not urgent and must be
struck from the roll.
[34]
On the merits of the application, the first respondent asserted that
he joined the applicant's
property division in 2021, where he worked
directly under the supervision of Mr Weber, who was the applicant's
regional operations
director at the time. The first respondent
contends that at the time he entered into the employment agreement
with the applicant,
which contained a restraint of trade, the
applicant had no fulfilment division and could not foresee that the
first respondent
would have any involvement in fulfilment generally.
During 2023, the first respondent was transferred from the
applicant's property
division to its new fulfilment division, which
had been largely created by Mr Weber.
[35]
According to the first respondent, Mr Weber resigned from the
applicant in early 2024. In the
wake of Mr Weber's departure, the
first respondent points out that he noticed an increasing sense of
hostility towards Mr Weber,
by both Mr Levitt and Venske of the
applicant, who attributed many of the difficulties that the
applicant's business was then experiencing
to him despite his
departure. First respondent’s attempts to address the problems
faced by the applicant were unsuccessful,
and it was during this time
that he realised that his position at the applicant had become
untenable and that he would need to
explore other opportunities.
[36]
The first respondent further asserted that he maintained a good
relationship with Weber after
the latter left the applicant. During
April 2025, Mr Weber informed the first respondent that he intended
to start his own fulfilment
business following the expiration of his
restraint of trade with the applicant on 1 March 2025. The company in
question became
the second respondent owned by Mr Weber and Mr
Goodman. In that company, the first respondent was offered an equal
share of the
business alongside Mr Weber and Goodman. Accordingly, he
resigned from the applicant on 29 May 2025.
[37]
From the day following the date of his resignation and until June
2025, he called the applicant's
clients to notify them of his
departure and to facilitate a smooth handover to his successor, one
Conry Orange. The applicant's
Group Operations Manager, Mr Venske,
initially opposed the idea of the applicant informing clients of his
departure, expressing
concern that such news might unsettle the
applicant's client base. Despite Mr Venske's objection, the first
respondent proceeded
to notify clients, as he believed it was both
appropriate and professionally necessary to do so.
[38]
The first respondent explained that it would have created an
impossible situation for Mr Orange
if the customer base discovered
that he was no longer there and that this fact had been concealed
from them, as he had been the
applicant's point of contact with the
applicant's clients. He proceeded to contact the applicant's clients
to facilitate a proper
handover of his duties to Mr Orange. Most of
the clients expressed regret at seeing him leave. A handful asked him
what he was
going to do, and in response, he told them that he was
going to be in a similar business. Some clients indicated to him that
they
were unhappy with the applicant services and did not wish to
continue using such services in the event of the first respondent's
departure.
[39]
Three clients inquired about following him to his new business
venture. These clients were Ecomignite,
Repcellin and Habit. He
informed these three entities that his restraint of trade prevented
him from soliciting or engaging them
in respect of any new venture.
Repcillin and Ecomignite were fundamentally unhappy with the
applicant. They would not stay with
the applicant after the first
respondent's departure. The first respondent also explained the
genesis of the applicant's relationship
with Repcillin and
Ecomignite. According to him, he personally identified and contacted
Repcillin with a view to signing them on
as a client for the
applicant in January 2024.
[40]
After his resignation and upon calling Ms Emma Sweet, who managed the
day-to-day operations of
Repcillin, advising her of his imminent
departure from the applicant, Ms Sweet advised the first respondent
that she under no circumstances
wanted to continue with the applicant
in the first respondent's absence and insisted that she would
terminate her agreement with
the applicant. The first respondent
stated that Repcillin became a client of the second respondent (his
new employer) without any
intervention from him. When she came to
know of this litigation, Ms Sweet of Repcillin wrote a letter and a
confirmatory affidavit,
which were attached to the applicant's
answering affidavit.
[41]
In that letter, Ms Sweet indicated that at no point did the first
respondent solicit or ask them
to move their business. They had built
a strong working relationship with the first respondent during his
time at applicant's employ,
and they experienced consistently good
service. Their decision to engage the second respondent was solely
based on their need for
reliable fulfilment services and was not the
result of any inducement or solicitation on the first respondent's
part.
[42]
Concerning Ecomignite, the first respondent stated that he was
introduced to its sole director,
Mr Roselt, by Mr Venske. The first
respondent contended that Mr Roselt was constantly complaining about
the applicant’s prices
during the period June 2024 to May 2025.
That ultimately culminated in Mr Venske requesting that he meet with
Mr Roselt to smooth
things over and retain his business for the
applicant. He met with Mr Roselt on 9 May 2025. At that meeting,
while Roselt confirmed
that he would stay with the applicant.
However, it was clear to him that this was a short-term commitment
and that Mr Roselt was
on the lookout for a different fulfilment
solution if his price requirements were not met.
[43]
Upon calling Mr Roselt during the week of 26 May 2025 to advise him
of his imminent departure
from the applicant, Mr Roselt advised him
that he would not continue with the applicant in the absence of the
first respondent
and further stated that he would terminate his
agreement with the applicant. Observing the provisions of his
restraint of trade,
the first respondent stated that he did not
suggest to Mr Roselt that he should follow him to the new business.
[44]
The first respondent attached a supporting affidavit and a letter
from Mr Roselt, wherein the
latter stated that from early 2025,
Aramex had actively sought his business, seeking to replace the
applicant as Ecomignite's fulfilment
partner. Mr Roselt confirmed the
meeting of 9 May 2025 with the first respondent, who was in the
applicant's employ at the time.
Mr Roselt stated that at that
meeting, the applicant offered him improved pricing, and he advised
the applicant that this was sufficient
for the time being to prevent
him from moving to Aramex.
[45]
Aramex continued to solicit his business, and they ultimately made an
offer which he found acceptable.
This prompted him to write a letter
to the applicant, informing them that June 2025 would be the last
month of doing business with
them. Mr Roselt stated that neither the
first nor the second respondent was the cause of this termination.
Notwithstanding, he
did not move his business to Aramex.
Subsequently, he had discussions with the second respondent, and an
improved offer was made
to him, which he accepted. Mr Roselt also
impugned the non-joinder of Ecomignite in the application. He
submitted that the preclusion
of Ecomignite from doing business with
the second respondent would cause material prejudice to Ecomignite
and its ongoing operations.
[46]
The first respondent also explained the discussion that took place
between him and the group's
operations manager relating to the
relaxation of the restraint of trade agreement. First respondent
contends that the agreement
that was reached after his meeting with
Mr Venske and subsequent email correspondence amounted to a variation
of the terms of the
restraint agreement. The first respondent further
opined that it cannot be disputed that both Ecomignite and Reccillin
are former
clients of the applicant who have no intention of
returning. In the first respondent's view, the applicant has no
protectable interest,
and the first respondent contends that, as a
matter of law, the applicant cannot restrain them from dealing with
the two entities.
[47]
The first respondent disputed that he was dishonest when he
negotiated with the applicant regarding
his restraint of trade
agreement. He implored the court to dismiss the applicant's
application with costs.
5.
The second respondent’s case
[48]
Mr Weber deposed to an affidavit on behalf of the second respondent.
He stated that he was the
Chief Operating Officer of the second
respondent and had been an integral part of establishing the
applicant's fulfilment business.
Mr Weber submitted that the
applicant's fulfilment business officially commenced on 3 July 2023.
He oversaw the business from its
conception and development in April
2023 until the termination of his employment with the applicant in
March 2024, following a
two-month notice period. In terms of his
contract of employment with the applicant, he stated that he was
restrained from, among
other things, competing with the applicant for
12 months from the date of termination of his employment until 1
March 2025.
[49]
According to him, following his resignation, he had already begun
conceptualising his own fulfilment
business as he was entitled to do
in early July 2024. He was, however, mindful that he had to wait out
the expiry of his restraint
which he did. He attached WhatsApp
correspondences to corroborate his averment. On 14 May 2025, he
caused the second respondent
(Stack One Fulfilment.co.za) to be
registered. Mr Weber asserted that the second respondent was
incorporated on 26 May 2025, and
Mr Goodman is the sole director and
owns all the shares. He declined to be a director as he is already a
director of five companies.
Mr Weber contended that the second
respondent's fulfilment business was initially envisaged and
conceptualised a month before the
first respondent's resignation on
29 May 2025.
[50]
Mr Weber contended that this application has been motivated by the
hostility that Mr Levitt,
the CEO of the applicant, developed towards
him following his departure from the applicant. Whilst he departed on
relatively good
terms, one of the reasons for his resignation was
that Mr Levitt and he had disagreements regarding his remuneration,
particularly
as regards the bonus model, which placed a strain on
their relationship. Furthermore, their relationship deteriorated
later that
year following the termination of the commercial
relationship between the applicant and Watch Tower Group (Pty) Ltd, a
company
of which Mr Weber is a director. This company provided
off-site monitoring services to the applicant from September 2019 to
October
2024.
[51]
Mr Weber also impugned the urgency with which this application was
brought. He shared the same
sentiments with the first respondent that
the relief sought by the applicant is incompetent in that Ecomignite
and Rapcillin were
not joined in these proceedings. Mr Weber sought
an order that the applicant's application be struck from the roll
with a punitive
cost order.
6.
Principal submissions by the parties
[52]
Mr Goldberg SC, counsel for the applicant, submitted that this matter
is urgent. Counsel argued
that if this matter were to be heard in the
normal course, the applicant would be prejudiced as the restraint of
trade between
the applicant, and the first respondent is for a year.
Counsel submitted that the first respondent has canvassed or
solicited business
from the prescribed clients of the applicant and
from the entities trading as Ecomignite and Repcellin in breach of
his restraint
of trade agreement with the applicant. Mr Goldberg
asserted that the second respondent is clearly complicit in the first
respondent's
unlawful conduct in breach of his restraint of trade and
that the second respondent is also complicit in benefiting from the
first
respondent's unlawful solicitation of the applicant's clients.
[53]
According to Mr Goldberg, a CIPC search in respect of the second
respondent reveals, inter alia,
that this entity was registered
shortly before the first respondent's resignation on 26 May 2025 from
the applicant. The first
respondent resigned on 29 May 2025. Counsel
emphasised that the invaluable springboard into the applicant's
market share is not
one that the second respondent would ordinarily
have, were it not for their employment of the first respondent.
Counsel argued
that a restraint of trade enforcement claim arises
against a third party, such as the second respondent, who, with full
knowledge
of the restraint of trade agreement, employs the concerned
employee.
[54]
Mr Goldberg submitted that the first respondent was the general
manager of the applicant's fulfilment
business and played a critical
role in the day-to-day operation of its fulfilment division, serving
as the primary point of contact
for all clients. He developed a deep
understanding of each client's business model delivery requirements,
fulfilment challenges
and pricing sensitivities. These relationships
were highly personal, and trust based. Counsel submitted that the
conduct of the
respondents to solicit the applicant’s clients
constitutes a direct threat to these legitimate business interests.
He implored
the court to grant the relief sought in the notice of
motion.
[55]
On the other hand, Mr Kirk-Cohen SC, counsel for the respondents,
submitted that the relief sought
by the applicant is legally
incompetent. Counsel submitted that the applicant is barking at the
wrong tree. In counsel’ view,
this case should centre around Mr
Weber and not the first respondent. Counsel submitted that the
applicant employed Mr Weber, and,
after his resignation, Mr Weber
served the 12 months and honoured his restraint of trade with the
applicant. Mr Kirk-Cohen argued
that Mr Weber's restraint clause has
expired, and it is within his right to solicit clients, including
that of the applicant. Counsel
also submitted that the matter is not
urgent. According to Mr Kirk-Cohen, the applicant had knowledge of
the allege breach of the
restraint of trade agreement on 18 July 2025
but failed to bring such application timely.
[56]
Mr Kirk-Cohen argued that the affidavit of Mr Roselt, the sole
director of Ecomignite, filed
on 13 August 2025, brings into sharp
focus three issues: one of fact and two of law. On a factual level,
Mr Roselt's affidavit
removes any suggestion that his business
Ecomignite was solicited away from the applicant by either
respondent. In fact, so the
contentions proceeded, the cause for the
termination of his contract with the applicant was an attractive
offer made to him by
Aramex. Counsel submitted that Mr Roselt's
decision to take his business to the second respondent was after this
termination had
already been communicated. There was no solicitation
of business by the first respondents. Counsel submitted that the
applicant
relies on inferential reasoning that the respondents
‘poached’ the applicant's client, particularly
Ecomignite.
[57]
Mr Kirk-Cohen further pointed out that from early 2025, Aramex,
another fulfilment service provider
in the industry, had actively
sought Ecomignite's business, seeking to replace the applicant as its
fulfilment partner. This assertion
aligns with the first respondent's
evidence that Ecomignite had long been complaining about the
applicant's pricing since June
2024, and that there was a waning of
confidence on the part of Mr Roselt about the competitiveness of the
applicant's pricing.
[58]
Counsel submitted that Aramex continued to solicit Ecomignite's
business and made an offer which
Mr Roselt found to be acceptable. It
caused him to give notice to the applicant on 2 June 2025 that
Ecomignite's contractual relationship
with the applicant was
terminated, effective from the end of June 2025. Mr Roselt intended
to take his business to Aramex. Self-evidently,
so the argument went,
neither the first nor the second respondent was the cause of this
termination. Furthermore, from the subsequent
discussion between Mr
Roselt and Mr Venske, the Group Operations Manager of the applicant,
there is no suggestion in Venske's communication
to Mr Roselt that
the circumstances of the termination are somehow attributable to the
conduct of the respondents.
[59]
Mr Kirk-Cohen also impugned the non-joinder of Ecomignite and
Repcillin in this application.
Counsel argued that the two entities
have a substantial and direct interest in the matter and would be
affected by any order the
court granted against them. Furthermore, in
counsel's view, Ecomignite is currently a client of the second
respondent. The second
respondent is lawfully entitled to trade and
is at liberty to solicit and canvass clients without restriction.
Counsel prayed the
court to dismiss the applicant's application with
costs.
7.
Issues
[60]
From the above discussion, the parties raised several issues on the
papers that this Court must
consider. First, the respondents impugned
the urgency with which this application was brought. According to the
respondents, this
matter is not urgent and must be struck from the
roll. Secondly, the respondents take issue with the applicant's
failure to serve
a notice in terms of Rule 41A. The question is
whether such a failure to serve the Rule 41A notice warrants this
Court to dismiss
the applicant's application. Thirdly, whether the
non-joinder of Ecomignite and Repecllin is fatal to the applicant's
application.
Fourthly, whether the applicant has made out a case for
an interdict against both respondents as prayed for in the Notice of
Motion.
8.
Relevant legal principles and discussion
[61]
As stated above, this is an urgent application for an interim
interdict against the first and
second respondents, specifically the
first respondent, to prevent him from breaching his restraint of
trade covenant with the applicant.
The applicant also seeks an
interdict against the second respondent from competing unlawfully
with the applicant. As will be discussed
later in this judgment, the
effect of the order sought by the applicant is final in effect. For
convenience, I will discuss the
disputed issues raised above
sequentially.
Urgency
[62]
As foreshadowed above, the respondents impugned the urgency with
which this application was brought
and the truncated timeline that
the applicant afforded them to file their answering affidavits. The
respondents argued that this
matter is not urgent. Rule 6(12) of the
Uniform Rules of court confers courts with a wide discretion to
decide whether an application
justifies enrolment on the urgent court
roll based on the facts and circumstances of each case.
[1]
When an applicant has departed from the normal time periods and has
stipulated truncated time limits in its notice of motion, it
must set
out circumstances justifying the extent of the departure from the
normal time limits, and why it claims that it could
not obtain
substantial redress at a hearing in due course.
[2]
The degree of departure from the modes of service and time frame in
the Uniform Rules must be commensurate with the urgency in
each
case.
[3]
[63]
The applicant in this matter is enforcing a restraint of trade
agreement. It is now trite that
proceedings for the enforcement of a
restraint of trade agreement are usually, by their very nature,
urgent. They invariably seek
to interdict ongoing unlawful action in
respect of which an applicant continues to suffer financial losses
which are notoriously
difficult to quantify, or to recover by way of
action.
[4]
As it will be
demonstrated hereunder, there is overwhelming evidence that the first
respondent is soliciting the applicant’s
clients for the
benefit of the second respondent.
[64]
Significantly, the restraint period is of a limited duration and is
being eroded daily. If the
applicant were required to wait for a
hearing in the ordinary course, the restraint period might have
expired or be of very limited
duration by the time the matter is
heard. As Mr Goldberg submitted, given the conduct of the
respondents, the apprehension of further
imminent harm to the
applicant's legitimate interest is palpable. Within the allotted
timeframe, the respondents successfully filed
their answering
affidavit and sourced information from third parties to support their
case. In my view, this matter is urgent and
deserves the immediate
attention of this Court.
Rule
41A Notice
[65]
The respondent contended that, in terms of Rule 41A of the Uniform
Rules of Court, there is a
peremptory requirement that applicants
shall serve a notice in which it is given a binary choice: It must
indicate whether they
agree to or oppose the referral of the dispute
to mediation. No such notice at the time the application was served
on the respondents
on 28 July 2025 was attached. Rule 41A envisages a
speedy resolution of disputes through mediation. The purpose of the
rule is
to require the parties to consider and inform the court of
their perspectives on whether the matter is capable of alternative
resolution
processes.
[66]
In this case, the respondents contended that the parties were very
close to settling and that
a via media could be found through
mediation, bridging the gaps that separate them and the applicant. It
is common cause that the
parties exchanged correspondence after the
application was served, and the applicant subsequently delivered a
notice in terms of
Rule 41A. The respondents did not accede to the
applicant's request for mediation, as the applicant had made a
conditional offer
to participate in mediation. The applicant stated
that it does not object to the referral of the matter to mediation,
subject to
the interim relief sought by the applicant pending the
commencement and outcome of any mediation. The respondents rejected
this
proposal because they believed that such mediation would take
place with them over a barrel, with the interim relief against them
a
fait accompli
.
[67]
However, at the hearing of this matter, the applicant's counsel
informed the court that the applicant
was willing to go for mediation
unconditionally with a view to settling the matter. The applicant's
counsel further informed the
court that the applicant was amenable to
a short postponement of the matter so that it could be referred to
mediation. The offer
was rejected outright by the respondents'
counsel on the grounds that the applicant's offer arrived too late
and that they would
only agree to a postponement on the condition
that the applicant pay the wasted costs of the day. This was
unacceptable to the
applicant, and the matter was argued on its
merits.
[68]
I appreciate that Rule 41A plays a critical role in resolving
disputes. This rule not only establishes
a framework for addressing
dispute, but it also serves as a stamp of approval by the Uniform
Rules for alternative dispute resolution
mechanisms. However, upon
reading the respective affidavits of the parties, I am of the view
that the parties are poles apart,
and that this is a quintessential
case where the court must dispense with the rule and consider the
matter on its merits. This
conclusion is also fortified by the fact
that before this application was launched, the parties had discussed
at length the relaxation
of the restraint agreement contained in the
applicant's employment agreement. The parties could not reach
consensus on all the
issues discussed.
[69]
Additionally, notwithstanding that the Rule 41A notice was not served
on the respondent simultaneously
with the application, the notice was
delivered shortly after the applicant's application was launched and
long before the answering
affidavit was prepared. In my view, this
matter is urgent. A delay in resolving the matter would prejudice the
applicant, particularly
in circumstances where the first respondent
freely and voluntarily signed an agreement of non-compete against the
applicant. The
respondents were indeed served with the Rule 41A
notice. The fact that it was not served together with the application
is inconsequential.
It does not warrant the dismissal of the
applicant's application.
The
non-joinder of Ecomignite and Repcillin
[70]
The respondents challenged the applicant's application for the
non-joinder of Ecomignite and
Repcillin. The respondents contended
that the applicant seeks an order prohibiting these two entities from
contracting with the
second respondent. According to the respondents,
the relief sought by the applicant provides the two entities with a
real and substantial
interest in the outcome of the litigation;
therefore, these two entities should have been joined in these
proceedings.
[71]
The general rule is that, if a party has an interest of such a nature
that it is likely to be
prejudiced by a judgment given in the
proceedings, such a party ought to be joined.
[5]
The test is whether or not a party has a ‘direct and
substantial interest’ in the subject matter of the action, that
is, a legal interest in the subject matter of the litigation which
may be affected prejudicially by the judgment of the court.
[6]
A 'direct and substantial interest' has been held to be an interest
in the right which is the subject-matter of the litigation
and not
merely a financial interest which is only an indirect interest in
such litigation.
[7]
A mere
financial interest is an indirect interest and may not require
joinder of a person having such interest.
[8]
[72]
The Appellate Division, as it then was, in
Amalgamated
Engineering Union v Minister of Labour
,
[9]
sets out two tests to determine whether a third party has a direct
and substantial interest in a matter: the one is whether the
third
party would have locus standi to claim relief concerning the same
subject-matter (the locus standi test), and the other is
whether the
third party who has not been joined can successfully raise the
defence of res judicata concerning the same subject-matter
in a
subsequent case and obtain a conflicting decision to that made in the
first instance (the res judicata test).
[73]
In the present matter, I am of the view that Ecomignite and Repcillin
have an indirect financial
interest in the matter as opposed to a
direct and substantial interest. This matter involves the enforcement
of a restraint of
trade against the first and second respondents. As
I see it, the two entities have no locus standi to the applicant’s
enforcement
of the restraint agreement against the respondents.
Likewise, the two entities cannot successfully raise the defence of
res judicata
in any subsequent case and, in the process,
obtain a conflicting decision to the one made in this matter, because
they were not
parties to this case.
[74]
In the circumstances, I conclude that the two entities fail the test
enunciated above. However,
even if I am wrong in my interpretation, I
must stress that the two entities were aware of the proceedings
between the applicant
and the respondents. The two entities chose to
file supporting affidavits in support of the respondents. From their
affidavits
and letters of support filed, it can be reasonably
inferred that they read the applicant’s notice of motion and
the founding
affidavit. The two entities had an opportunity to
intervene in these proceedings if indeed they felt that their
interests would
be prejudiced.
[75]
They consciously opted not to intervene. Moreover, the respondents
could have pursued an application
to join these entities in the
matter if they deemed their involvement to be indispensable.
Consequently, I conclude that the respondents’
preliminary
point of non-joinder must ultimately be dismissed.
Has
the applicant made out a case for the restraint of trade?
[76]
From the outset, I must stress that the applicant cannot enforce the
alleged restraint of trade
against the respondents if such
enforcement would be unreasonable. The following four factors
determine reasonableness:
[10]
76.1
Does the applicant establish a protectable interest?
76.2 If
so, is such interest threatened by the first respondent’s
employment with the second respondent?
76.3 If yes,
does the applicant’s protectable interest outweigh,
qualitatively and quantitatively, the first respondent’s
interest to be economically active and productive?
76.4 If
yes, is there another aspect of public policy having nothing to do
with the relationship between the parties
that requires the restraint
of trade not to be enforced?
76.5
Does the restraint go further than necessary to protect the interest
of the applicant?
[77]
If the answer is no to any of the first three questions, the
restraint of trade cannot be enforced.
Furthermore, an employer
cannot prevent an erstwhile employee from applying their skills,
knowledge, and experience in their new
employment. I, in turn, deal
with these factors
ad
seriatim
.
[11]
Did
the applicant establish a legitimate protectable interest?
[78]
There are two types of proprietary interests generally recognised as
deserving of protection,
although there is no fixed list. The first
kind consists of the relationships with customers, potential
customers, and suppliers
that make up what is compendiously referred
to as the 'trade connection' of the business, being an essential
aspect of its incorporeal
property known as goodwill.
[12]
[79]
The second kind consists of all confidential matters which are useful
for the carrying on of
the business and which could therefore be used
by a competitor, if disclosed to him, to gain a relative competitive
advantage.
Such confidential material is sometimes compendiously
referred to as 'trade secrets'.
[13]
[80]
If I understand the applicant's application correctly, the
applicant's application does not concern
trade secrets or
confidential information, but rather client connections or trade
connections that impact the goodwill of the applicant.
After
carefully evaluating the conspectus of all the evidence provided, I
am of the view that the applicant demonstrated a significant
and
compelling protectable interest. The following objective facts
support this conclusion: It is common cause that the first respondent
was the General Manager of the applicant's fulfilment business. The
first respondent was the main point of contact with the applicant's
fulfilment clients. This was particularly true for the applicant's
larger clients, such as Ecomignite. The first respondent was
responsible for maintaining the client relationship and ensuring
their satisfaction.
[81]
The first respondent was entrusted with managing these relationships
and serving them in the
applicant's interests. The first respondent
had a close connection with the applicant's clients. He had full
responsibility for
dealing with clients and direct oversight of daily
client communication, service delivery and issue resolution. He was
responsible
for preparing and submitting all pricing proposals. If
there was dissatisfaction, it was the first respondent who was
charged with
resolving it. The applicant stressed that the first
respondent repeatedly and publicly praised the fulfilment division
under his
tutelage, especially on social media.
[82]
The applicant's assertion in this regard is corroborated by the
respondent's averments in the
answering affidavit wherein the first
respondent asserted that he personally identified and contacted
Repcillin with a view to
signing them on as a client for the
applicant during January 2024. The first respondent further asserts
that his point of contact
at Repcillin was Ms Emma Sweet, who is the
daughter of the co-members of Repcillin and who he understood was
involved in Repcillin's
day-to-day operations.
[83]
Moreover, Mr Roselt of Ecomignite also corroborated the applicant's
version in his affidavit.
Mr Roselt stated that Ecomignite has used
the applicant as a fulfilment contractor for several years. Mr Roselt
further asserted
that initially, his relationship was with Mr Dean
Venske. However, he later met the first respondent at the applicant's
warehouse,
following which he became his primary and regular point of
contact. Over time, they developed an excellent professional
relationship,
and he came to regard the first respondent as a trusted
business associate.
[84]
Additionally, when Ecomignite sent an email to the applicant's Group
Operations Manager (Mr Venske)
and the first respondent pointing out
that another competitor in the fulfilment industry had offered his
business better rates,
Mr Venske and the first respondent analysed
the rates that Ecomignite was complaining about and concluded that he
was in fact not
being offered a better deal compared to the
applicant's pricing structure. The first respondent, as the point of
contact with clients,
convinced Mr Venske to let him manage Mr Roselt
of Ecomignite because of their close working relationship. This
resulted in a meeting
which took place on 9 May 2025, where the first
respondent represented the applicant in discussing the impasse
between the applicant
and Ecomignite.
[85]
From the foregoing, it is abundantly clear that the first respondent
was the point of contact
of the applicant's clients. His relationship
with the applicant's clients characterises a compelling protectable
interest in client
connections. The first respondent played a
critical role in the day-to-day operations of the applicant's
fulfilment division and
was the primary point of contact for all
clients. He managed all ongoing communications, coordinated daily
service delivery, and
established himself as the trusted operational
liaison for clients.
[86]
Intelligibly, the first respondent held direct correspondence with
clients. He developed a deep
understanding of each client's business
model, delivery requirements, fulfilment challenges and pricing
sensitivities. These relationships
were highly personal and
trust-based, particularly within the Small and Medium Enterprise
client base, where businesses rely heavily
on service continuity and
personal support. Therefore, the applicant succeeded in establishing
a compelling protectable interest.
Is
the applicant’s protectable interest threatened by the first
respondent’s employment with the second respondent?
[87]
Having found that the applicant has a protectable interest, the
question is whether such interest
is threatened by the first
respondent's employment with the second respondent. This question, in
my view, must be considered from
the well-established principle that
a restraint of trade clause with the sole aim of stifling competition
is against public policy
and unenforceable.
[14]
It is common cause that the first respondent is subject to a
restraint of trade in favour of the applicant for a period of 12
months after the termination of his employment. From the first
respondent's own affidavit, it is without a doubt revealed that the
first respondent solicited the applicant's clients.
[88]
It bears emphasis that the need of an employer to protect his trade
connections arises where
the employee has access to customers and is
in a position to build up a particular relationship with the
customers so that when
he lives the employer’s service, he
could easily induce the customers to follow him to a new
business.
[15]
The employee, by
contact with the customer, ‘gets the customer so strongly
attached to him that when the employee quits and
joins a rival he
automatically carries the customer with him in his pocket’.
[16]
[89]
In casu
, Mr Venske of the applicant opposed the first
respondent's idea of informing clients of his departure from the
applicant. Mr Venske
expressed concern that such news might unsettle
the applicant's client base. Notwithstanding the applicant's
opposition to the
first respondent informing clients, the first
respondent proceeded to notify them, knowing very well of his trade
connection with
the applicant's client. He called the applicant's
clients and told them that he was leaving. Importantly, when he
called the applicant's
clients, he was still employed by the
applicant and was aware that he was joining a competitor of the
applicant. Incontestably,
the first respondent had formed an
attachment with the applicant’s clients and acquired an
influence over them which he never
had before.
[90]
The suggestion by the first respondent that he notified the
applicant's clients of his departure
to facilitate a smooth handover
to his successor is a sheer contrivance. The first respondent
understood that he had a close working
relationship with the
applicant's clients. As Mr Roselt points out, the first respondent
knew over time that he had developed an
excellent professional
relationship with the applicant's clients and that they regarded him
as a trusted business associate. From
the objective facts, the only
reasonable inference to be drawn in the first respondent's conduct
was that he was soliciting the
applicant's clients to follow him to
the second respondent in breach of the restraint of trade covenant.
[91]
Demonstrably, the applicant's protectable interest is threatened by
the first respondent's employment
with the second respondent. The
first respondent has already caused two of the applicant's clients to
leave the applicant and to
use the second respondent in the
applicant's stead. In my view, the applicant must be protected
against the respondents in that
if the relief in the notice of motion
is not granted, there's a likelihood that the first respondent will
continue to solicit other
clients of the applicant to the applicant's
prejudice.
[92]
Ecomiginite and Repcillin were the clients of the applicant before
the applicant resigned. Surprisingly,
immediately upon his
resignation, the two entities followed the first respondent to the
second respondent. In my view, it is inescapable
not to conclude that
the first respondent clearly solicited the two entities to follow him
when he started with the second respondent.
The second respondent, on
the other hand, is enjoying the benefits of the first respondent's
breach of the restrained agreement.
[93]
I am mindful of the supporting affidavits submitted by Mr Roselt and
Ms Sweet, which indicate
that they were not solicited. However, a
thorough examination of the facts in this case unequivocally refutes
their assertion.
This conclusion is underscored by the affidavit of
Mr Roselt. In his deposition, Mr Roselt asserts that the first
respondent informed
him that he was going to be employed by a similar
business and disclosed the identity of his employer. Mr Roselt asked
the first
respondent if he could follow him to his new employer. On 2
June 2025, shortly after the first respondent had contacted Roselt,
Ecogmignite gave notice to the applicant that it was moving its
business to Aramex. After the first respondent resigned, Ecomignite
moved its business directly to Stack One (the first respondent’s
new employer) and it never used Aramex.
[94]
Consequently, the applicant's protectable interest is being
prejudiced by the first respondent's soliciting
of the applicant's
clients for the benefit of the second respondent. The second
respondent is complicit in that it is benefiting
from the first
respondent's unlawful solicitation of the applicant's clients.
Moreso, Mr Weber knows that there is a restraint
agreement that binds
the first respondent not to compete with the applicant. The second
respondent is thus unlawfully competing
with the applicant.
Does
the applicant’s protectable interest outweigh, qualitatively
and quantitatively the first respondent’s interest
to be
economically active and productive?
[95]
The applicant avers that although the first respondent's employment
with the second respondent
constitutes a breach of the restraint of
trade, the applicant does not seek to prevent the first respondent
from continuing to
work with that company. The applicant does not
seek to impede the first respondent's ability to work and earn a
living, even if
it means competing with the applicant. However, the
applicant contends that the first respondent has unlawfully solicited
its existing
clients, thereby breaching the restraint of trade.
[96]
The second respondent is a direct competitor of the applicant. I
believe that the impact on the
applicant should the relief be denied
is significantly more consequential than any potential repercussions
that the respondents
may encounter. To my mind, while competition is
beneficial, it is imperative that such competition remains within the
confines
of legality to ensure fairness and justice.
9.
Interim or final interdict?
[97]
As discussed above, the applicant sought an interim interdict in this
application to restrain
the respondents from soliciting its clients.
However, after perusing the respective affidavits, it became clear to
me that the
effect of the relief sought by the applicant is final in
nature. I also noted that once the order requested by the applicant
is
granted, the Court will not revisit any matters on the return
date, as all issues will have already been addressed. To this end,
I
invited the parties to submit a post-hearing note to the Court to
address this point.
[98]
Mr Goldberg noted that the order sought by the applicant at this
stage is self-evidently of an
interim nature. Furthermore, the
respondents have at no stage contended that the relief sought was
final in effect. However, counsel
submitted that if the Court holds
that the relief sought is final in nature, the applicant respectfully
contends that it has met
and exceeded the threshold for final relief.
Mr Kirk-Cohen, on the other hand, agreed that all things considered,
if this Court
grants any form of interdict, it will be final in
effect. No other court will ever consider the substance of the
matter. Counsel
argued that the matter would be moot by the time it
is heard.
[99]
It bears emphasis that an interim interdict is a temporary measure
designed to protect rights
before a final determination can be made.
An interim interdict does not involve a final determination of the
rights of the parties
and does not affect their final
determination.
[17]
In other
words, it does not finally dispose of the rights between the parties.
The
lis
between them remains to be disposed of in the pending proceedings. As
soon as the court makes a final determination, the interim
interdict
is discharged. However, in my view, regard should be had to the
substance of the relief sought rather than the form of
the relief
sought.
[100]
As mentioned above, the substance of the relief sought by the
applicant is final in effect. This view is bolstered
by the fact that
no other court will ever consider the substance of the matter, even
if the return date of this matter is within
the 12-month restraint
period. The parties have filed all their affidavits and heads of
argument addressing all the issues raised
in the respective
affidavits. The parties have argued the substances (merits) of the
issues raised in the affidavits. Ostensibly,
there is no quest by any
party to put further facts before this Court. As noted by Mr
Kirk-Cohen, the papers must be regarded as
finalised, and a final
decision can be made without prejudice to any party. I agree with
that proposition. A hearing on the return
date will rehash issues
that have already been addressed and decided upon. This may lead to
an inefficient use of judicial resources
and result in the incurrence
of unnecessary costs.
[101]
In my view, the substance of the order sought by the applicant,
although it was cast in the form of an interlocutory
interdict, it
was in effect an application for a final interdict. The consequence
of the order sought by the applicant will be
final in effect. It has
been consistently held that 'final in effect' means that an issue in
the suit has been affected by the
order such that the issue cannot be
revisited either by the Court of first instance or that hearing the
action’.
[18]
I will
therefore thoughtfully consider this interdict application from the
premise that the applicant is seeking a final order.
10.
Did the applicant establish the requirements of a final interdict?
[102]
The law regarding the grant of a final interdict is trite. The test,
for the granting of a final interdict, requires
an applicant to
establish:
(a) a clear right.
(b) a reasonable
apprehension of irreparable harm and imminent harm to the right.
(c) no other satisfactory
remedy available to the applicant.
[103]
Once the applicant has established the three requisite elements for
the grant of an interdict, the scope, if any,
for refusing relief is
limited.
[19]
There is no
general discretion to refuse relief. To withhold an interdict
where a case for such has been made, would deny
the injured party a
remedy for its injury, and that would be inconsistent with the
constitutionally protected right of access to
courts for the
resolution of disputes.
Did
the applicant establish a clear right?
[104]
In this case, the first respondent was employed by the applicant with
a restraint of trade agreement in his employment
contract. The
applicant asserts that the first respondent breached the restraint of
trade agreement. The first respondent resigned
from the applicant's
employ on 29 May 2025. Before his resignation, the first respondent
was offered an equal share in the second
respondent (Stack One), a
competitor of the applicant in breach of the restraint of trade
agreement. Contrary to the applicant's
direct instructions, the first
respondent immediately contacted the applicant's clients.
[105]
Despite the restraint of trade in his employment agreement, the first
respondent informed the applicant's clients
that he was leaving the
applicant and was going to be employed in a similar business.
Pursuant thereto, the first respondent caused
two of the applicant's
clients to leave the applicant and to use the second respondent as
their fulfilment partner. In my view,
the applicant has established a
clear right and has demonstrated the irreparable harm that would
result if the interdict were not
granted. There can be no doubt that
the actions taken by the respondents to solicit the clients of the
applicant constituted a
violation of the applicant's rights and
resulted in damages that are inherently difficult to quantify.
Alternative
remedy.
[106]
In this case, I believe that the applicant does not have an
alternative remedy. As foreshadowed above, it would
be objectively
impossible, in my view, for the applicant to quantify its damages.
The applicant has invested considerably in establishing
its
fulfilment division and its fulfilment client base. I accept that an
interdict is meant to protect future conduct and not decisions
already made; however, as discussed above, the first respondent has
already secured the business of two of the applicant's clients.
This
conduct breached the applicant's protectable interest. The risk that
others would be induced to follow him if not interdicted
is manifest.
Furthermore, the applicant cannot be allowed to infringe the
applicant’s protectable interest.
[107]
Given all these considerations, I believe the applicant’s
application for an interdict must succeed.
11.
Order
[108]
In the result, the following order is granted.
[108.1]
The
first respondent
is hereby restrained and interdicted for
a period of 12 (twelve) months, commencing on 1 July 2025, from
breaching the covenant
in restraint of trade he concluded with the
applicant by (directly or indirectly, solely or jointly, whether as a
proprietor, partner,
director, shareholder, employee, consultant,
contractor, financier, agent and/or representative) canvassing or
soliciting business
(or attempting to do so) in respect of fulfilment
services from any person who was a client or a prescribed client of
the applicant
during the first respondent’s employment with the
applicant and/or any person to whom or on whose behalf the applicant
rendered
or currently renders any services during any part of the
first respondent’s employment with the applicant and/or any
person
who or which is or was a prospective client of the applicant
at the termination date of the first respondent’s employment
with the applicant being 30 June 2025 (the termination date), or whom
the applicant approached to do business with within 1 (one)
year
preceding the termination date and/or any person to whom fulfilment
services were rendered by the applicant within a period
of 1 (one)
year preceding the termination date, and in particular, the first
respondent is interdicted and restrained for the said
12 (twelve)
months period from canvassing or soliciting business (or attempting
to do so) in respect of fulfilment services from
the following
persons who were clients/customers of the applicant during the first
respondent’s period of employment with
the applicant, namely;
the business trading as Ecomignite and the business trading as
Repcillen.
[108.2]
The
second respondent
is hereby restrained and interdicted for
a period of 12 (Twelve) months, commencing on 1 July 2025, from
canvassing or soliciting
business (or attempting to do so) from the
clients who comprise the prescribed clients of the applicant, and in
particular the
entities referred to in subparagraph 108.1 above in
respect of fulfilment services.
[108.3]
The first and second respondents are ordered to pay the
costs of this
application on a party and party scale, jointly and severally, with
the one paying the other to be absolved, including
the costs of two
counsels where so employed, on scale B.
LEKHULENI
JD
JUDGE
OF THE HIGH COURT
APPEARANCES
For
the Applicant:
Adv D Goldberg SC
Adv J Ord
Instructed
by:
Smiedt & Associates Attorneys
For
the Respondents: Adv
Kirk-Cohen SC
Instructed
by:
Nirenstein Attorneys Inc
[1]
Mogalakwena
Local Municipality v Provincial Executive Council, Limpopo
[2014] 4 AII 67 (GP) at para 63;
Caledon
Street Restaurants CC v D’ Aviera
1998 JDR 0116 (SE) at 8.
[2]
Luna
Meubel Vervaardigers (EDMS) BPK v Makin and another (t/a Makin’s
Furniture Manufactures)
1977
(4) SA 135
(W) at 137F-G).
[3]
Republikeinse
Publikasie (edms) Bpk v Afrikaanse Pers Publikasie (edms) Bpk
1972 (1) SA 773
(A) at 782A-G.
[4]
Boomerang
Trade CC t/a Border Sheet Metals v Groenewald and Another
[2012] JOL 29426
(ECG) para 36;
Mozart
Ice Cream Franchises (Pty) Ltd v Davidoff and Another
2009
(3) SA 78
(C) at 88J.
[5]
Standard
Bank of South Africa Ltd v Swartland Municipality and Others
2010 (5) SA 479
at 482F.
[6]
Zingwazi
Contractors CC v Eastern Cape Department of Human Settlements
2021
(6) SA 557
(ECG) para 62.
[7]
Bohlokong
Black Taxi Association v Interstate Bus Lines (Edms) Bpk
1997
(4) SA 635
(O) at 644A-B.
[8]
Hartland
Implemente (Edms) Bpk v Enal Eiendomme BK
2002
(3) SA 653
at 663E–H.
[9]
1949 (3) SA 637
(A) at 660-661.
[10]
Basson
v Chilwan
1993 (3) SA (A) 742 at 767G-I.
[11]
Northern
Offices Computers (Pty) Ltd v Rosenstein
1981
(4) SA 123
(C) at 136B-D.
[12]
Sibex
Engineering Services (Pty) Ltd v Van Wyk
1991 (2) SA 482
at 502D-F.
[13]
Sibex
Engineering Services (Pty) Ltd v Van Wyk
fn 12 above at 502D-F.
[14]
Ice
Cream Francise (Pty) Ltd v Davidoff and Another
2009 (3) SA 78
(C) at 82H-83C.
[15]
Rawlings
and Another v Caravantruck (Pty) Ltd
[1992] ZASCA 204
;
1993 (1) SA 537
(A) at 541.
[16]
Rawlings
and Another v Caravantruck (Pty) Ltd
fn 15 above at 541.
[17]
Rudkurum
(Pty) Ltd v Weider Gym Athlone (Pty) Ltd
1996 (4) AII SA 29 (C) at 33.
[18]
Cipla
Agrimed (Pty) Ltd v Merck Sharp Dohme Corporation
,
2018 (6) SA 440
(SCA) para 47.
[19]
Hotz
and Others v University of Cape Town
20171 (2) SA 485 (SCA) para 29.
sino noindex
make_database footer start
Similar Cases
Technical Systems (Pty) Ltd and Another v RTS Industries and Others (Leave to Appeal) (17470/2014) [2025] ZAWCHC 453 (3 October 2025)
[2025] ZAWCHC 453High Court of South Africa (Western Cape Division)99% similar
Technical Systems (Pty) Ltd and Another v RTS Industries and Others (17470/2014) [2025] ZAWCHC 292 (14 July 2025)
[2025] ZAWCHC 292High Court of South Africa (Western Cape Division)99% similar
TMT Services and Supplies (Proprietary) Ltd t/a Traffic Management Technologies v City of Matlosana and Another (21070/2024) [2025] ZAWCHC 582 (10 December 2025)
[2025] ZAWCHC 582High Court of South Africa (Western Cape Division)99% similar
South African Legal Practice Council v Engelbrecht (23138/2023) [2025] ZAWCHC 468 (10 October 2025)
[2025] ZAWCHC 468High Court of South Africa (Western Cape Division)99% similar
Technical Systems (Pty) Ltd and Another v RTS Industries and Others (17470/2014) [2024] ZAWCHC 2 (2 January 2024)
[2024] ZAWCHC 2High Court of South Africa (Western Cape Division)99% similar