Case Law[2024] ZAWCHC 327South Africa
Protecta Security Pty Ltd v Daney (14479/2024) [2024] ZAWCHC 327 (12 July 2024)
High Court of South Africa (Western Cape Division)
12 July 2024
Headnotes
the provision provides that the employee would, in the performance of his duties with the company, be exposed to confidential information that is commercially invaluable to the company and generally not known or easily ascertainable in the industry. These would include technical and scientific information concerning the company’s products and services and information, as well as information concerning cost information, profits, sales information, business plans and marketing methods, including customer lists and customer information. The employee agrees that he/she shall protect the confidential information of the company and shall handle it in such a way as to prevent any unauthorised disclosure.
Judgment
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## Protecta Security Pty Ltd v Daney (14479/2024) [2024] ZAWCHC 327 (12 July 2024)
Protecta Security Pty Ltd v Daney (14479/2024) [2024] ZAWCHC 327 (12 July 2024)
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sino date 12 July 2024
FLYNOTES:
LABOUR – Restraint –
Protectable interest –
Security industry –
Employed by applicant for less than two months – Did not
have any time to obtain trade secrets
or confidential information
of applicant – Not privy to sales or marketing of company –
Respondent would be barred
from being employed in security,
countrywide, for three years – Clause is contrary to public
policy – Lack of
jurisdictional curtailment –
Enforcing restraint would be contrary to public policy –
Application dismissed.
IN
THE HIGH COURT OF SOUTH AFRICA
(WESTERN
CAPE DIVISION, CAPE TOWN)
CASE
NUMBER: 14479/2024
In
the matter between:
PROTECTA
SECURITY PTY
LTD
Applicant
(Registration
Number: 2021/662278/07)
and
ROGER
DANEY
Respondent
Heard
on: 8 July 2024
Electronically
delivered on: 12 July 2024
JUDGMENT
KUSEVITSKY,
J
[1]
This is an urgent application in which the Applicant, by way of
interdict, seeks to enforce
a restraint of trade clause as contained
in the Respondent’s contract of employment.
[2]
The relief sought are the following:
“
2. The Respondent
is interdicted and restrained from disclosing any of the Applicant’s
trade secrets, confidential documentation,
technical and scientific
information concerning the company’s products and services,
cost information, profits, sales information,
accounting and
unpublished financial information, business plans, markets and
marketing methods, customer lists and customer information,
purchasing techniques, supplier lists and supplier information and
advertising strategies, drawings, systems, chemical formulae,
methods, software, processes, clients list, programmes, marketing
and/or financial information which he acquired by virtue of the
employment with the Applicant;
3. The Respondent is
interdicted and retrained until 24 May 2027 and within South Africa
from:
3.1
being interested, in any way, in any business which carries on
business, manufactures, sells
or supplies any commodity or goods,
brokers or acts as an agent in the sale or supply of any commodity or
goods and performs or
renders any service in competition with or
identical or similar or comparative to that carried on, sold,
supplied brokered or performed
by the Applicant, during the period of
his employment with the Applicant;
3.2
soliciting, in any way, the custom of or deal with transact with, in
competition to the Applicant,
any business, company, firm,
undertaking, association or person which, during the period of 1 year
preceding the date of termination
of the employment of the
Respondent, has been a customer of supplier of the Applicant or
Coastal Security in South Africa.”
[3]
The Respondent opposed the application
in person
. With regard
to the question of urgency, I am sufficiently satisfied that
prima
facie
the merits, the relief sought warrants the urgent court’s
attention.
[4]
The facts underpinning the application is as follows. The Applicant
carries on business
in the security industry and has various branches
countrywide, with its head office in Mpumalanga. It is common cause
that the
deponent to the founding affidavit, Mr. Johan Potgieter,
under the style of the Applicant, purchased a local security company
situated
in Knysna named Coastal Security. During April 2024, the
Applicant entered into employment contracts with the employees of
Coastal
Security, including the Respondent on 5 April 2024.
[5]
According to the employment contract, the Respondent was employed as
a Technical manager.
Germane to the application are the relevant
restraint clauses; clause 15 deals with confidentiality, clause 16
which deals with
Company Trade Secrets and clause 18 which deals with
the restraint of trade. In the application, the Applicant relies on
clauses
16 and 18. Clause 16 is extensive, but in summary the
provision provides that the employee would, in the performance of his
duties
with the company, be exposed to confidential information that
is commercially invaluable to the company and generally not known
or
easily ascertainable in the industry. These would include technical
and scientific information concerning the company’s
products
and services and information, as well as information concerning cost
information, profits, sales information, business
plans and marketing
methods, including customer lists and customer information. The
employee agrees that he/she shall protect the
confidential
information of the company and shall handle it in such a way as to
prevent any unauthorised disclosure.
[6]
Clause 18 of the Restraint of Trade clause provides as follows:
“
For the duration
of the employment agreement between the parties and for 3 years after
termination thereof for whatever reason,
the employee will not work
as an employee, agent, representative, owner, partner, consultant,
director, manager or will not engage
in any other capacity in any
direct or indirect competition with the business, business operation,
products, customers or clients
of the company.”
[7]
The Applicant avers that on 10 May 2024, the Respondent resigned from
employment with the
Applicant. In the letter of resignation, he
indicated that he felt the need to move on from the security industry
for personal
reasons. Subsequent to his resignation, he worked the
two weeks notice period as stipulated in the employment contract. He
left
the Applicant’s employ on 24 May 2024.
[8]
On 7 June 2024, it came to the knowledge of the Applicant that the
Respondent was in fact
employed by Allsound Security CC, also
situated in the Knysna district and is the Applicant’s biggest
competitor in the security
industry. The Applicant contends that as a
former employee of the Applicant, that the Respondent has inside
information in respect
of the company, more specifically its client
base and that he is in a position to exploit the Applicant’s
client list and
assist the Applicant’s competitors to tailor
their services in such a manner that will enable it to attract
clients from
the Applicant, where such information is not freely
available to third parties.
[9]
The Applicant also contends that the Respondent is actively
contacting and soliciting clients
of the Applicant contrary to the
contract of employment, which is causing the Applicant to lose
existing clients. In this regard,
the Applicant relied on instances
in which ostensibly four of its clients had cancelled their services
with the Applicant and instead,
employed the services of Allsound
Security, the Respondent’s new employer. More specifically in
the first instance, the Applicant
says that it issued a quotation for
various security services totalling an amount of R 218 273.50 to
Knysna Quays, a company
situated in Knysna. The Applicant avers that
the quotation was verbally accepted and that the Applicant would
provide the services
as quoted. However, shortly after the Respondent
had left the Applicant’s employ, Knysna Quays informed Mr
Potgieter that
they had decided to contract with Allsound Security CC
instead and as a result, the Applicant contends, it effectively lost
the
contract. The second client was a Mr James Smith. The Applicant
said that they had received correspondence from Mr Smith on 4 June
2024 informing the Applicant of his intention to move to Allsound
Security CC. They contend that this was strange since on 27 May
2024
in correspondence with Mr Smith, he made no mention of his intention
to cancel the Applicant’s services. Two other clients
were
mentioned, stating that they were moving to Allsound Security.
[10]
The Applicant therefore contends that this will repeat over time and
that it has no doubt that the Respondent
approached various of its
existing customers attempting to solicit them, and will continue to
do so for as long as the restraint
of trade clause is not enforced
against the Respondent. On 12 June 2024, the Applicant’s
attorney sent the Respondent a letter,
inter alia
directing
him to provide a written undertaking that he would immediately and
forthwith terminate his employment with Allsound Security
CC and that
he should comply with the restraint of trade agreement. In reply, the
Respondent, then represented, advised the Applicant
that he was of
the view that clause 18 of the employment contract was unenforceable,
but nevertheless stated that he has adhered
to clause 16 of the
employment contract and he gave a further undertaking that he would
continue to do so. The Applicant argues
that that undertaking did not
make provision for all of the acts which are recorded in the
restraint provision; that the Respondent
has not provided any bases
for contending that clasue18 was unenforceable; that the restraint
clause was mutually agreed upon to
protect the company’s
legitimate business interests being its confidential information,
trade secrets, customer relationships
and overall competitive edge
and that the Respondent signed and acknowledged the provision.
[11]
On 26
June 2024, this application was served on the Respondent. On 28 June
2024, Logan Martin Inc. withdrew as attorneys of record
for the
Respondent. On 7 July 2024, the Respondent filed his answering
affidavit. In this affidavit, the Respondent made the
following
averments: He relocated to Knysna from Johannesburg in June 2023
where he was employed as a radio technician for five
years and under
his manager, Mr Gerhard Kotze for three of those years. Mr Kotze then
decided to purchase a small security company
in Knysna called Coastal
Security and offered that he join him as Technical Manager. He
accepted the offer and relocated with permanent
appointment with
Coastal Security where he completed his PSIRA Grade E
registration
[1]
. He stated
that he has fifteen years’ previous experience in the security
industry and has acquired knowledge and experience
with CCTV
installation, access control systems, gate automation, alarm systems
and other general technical experience standard
to the Security
Industry. He further states that all of these systems are readily
available through all of security companies and
suppliers throughout
South Africa and that he has never been involved with any design,
research, software development or any specific
expertise related to
the Security Industry.
[12]
With regard to his employment with the Applicant, he states that on 2
April 2024, he arrived at work and
was met by the deponent who
informed him that the Applicant had purchased Coastal Security and
had taken over its operations. On
that same, he was presented with
the contract of employment, which he signed on 5 April 2024, but says
that Applicant required
him to backdate the start of employment date
by three months so that he could be paid. It is evident from the
contract that the
date of appointment is from 4 February 2024. The
contract also contained a probation period of three months which the
Respondent
was unhappy with. He states that he was informed that the
probation period would be enforced regardless of his permanent
employment
with Coastal Security.
[13]
Dissatisfied with this and other provisions which he highlighted such
as work hours and job description,
he decided to terminate his
employment with the Applicant since the probation period did not
offer him job security in order to
support his family. In argument,
he stated that he was the only person in his household that was
employed. He resigned on 10 May
2024 and did not inform the Applicant
of the real reason for his termination as he was concerned that his
new employer would be
vindictive. He worked his two week notice
period with his last day being 24 May 2024. He returned the company
laptop and says the
cellphone which he used for business was his own
personal cellphone which he retained. He says all calls that he
received for the
Applicant was redirected to another employee of
Applicant.
[14]
The Respondent states that he started employment with Allsound
Security CC on 27 May 2024. His position is
exclusively based on a
private security estate known as Pezula and his job description is to
supervise a team of security officers
managing access control and
security within the estate. He states that he does not engage with or
supply quotations or installation
services to any clients of Allsound
Security CC and does not have any contact with any alarm monitoring
and response client bases.
He avers that his current position is
therefore not in direct conflict with the Applicant’s client
base.
[15]
With regard to the allegations made pertaining to the four clients of
the Applicant, the First Respondent
states that during his employment
with the Applicant, he assisted in preparing a quotation for Knysna
Quays, which is actually
an existing client of his current employer,
Allsound Security CC. He says he met with their representatives on
two occasions while
they were obtaining quotations from alternative
service providers for consideration. As support for this contention,
an affidavit
was obtained by a committee member of Knysna Quays. In
that affidavit, the member states that the committee were looking at
various
security tenders for the Quays which included Fidelity Adt,
their current service provider Allsound Security CC and the
Applicant.
The member states that at no time was there any verbal
communication with any of the companies stating that they would be
awarded
the tender. He further states that the committee, after
careful consideration of all the tenders, opted to stay with the
current
service provider, being Allsound Security CC. He concludes
that at the time that the committee made their decision to award the
tender to Allsound Security CC, he was not aware that the Respondent
had been employed by them at Pezula Private Estate and confirmed
that
he had no influence on the committee awarding the tender to Allsound
Security CC. This was confirmed by the owner of Allsound
Security CC.
In an affidavit, the owner, Mr Declan Nurse denied the
Applicant’s allegations that the Applicant had
‘effectively
lost the contract’. He clarified that Knysna Quays has been a
client of Allsound Security CC since 1 October
2016 for the provision
of guarding, CCTV installation and Monitoring services. This contract
is still ongoing and was at no time
cancelled nor notice of
cancellation issued.
[16]
With regards to the Applicant’s claim that Respondent had been
instrumental in the loss of the contract
of Mr Smith, the Respondent
averred that he had never spoken to, nor met Mr Smith and that he was
in no way involved in Mr Smith’s
decision to change service
providers to Allsound Security CC. This was confirmed by Mr Smith in
an affidavit in which he stated
that the reason for his termination
was that he was concerned about the number of times his service
provider – now under
the name and style of Protecta, had
changed ownership. He says that he had been a client of Coastal
Security for many years and
that they had provided alarm monitoring
services to his home and in fact, he was also a client of Allsound
Security CC who provided
security services to his business premises.
He says that he was informed that Coastal Security had sold the
business, but that
the new owner would retain the name and continue
trading as Coastal Security. He says that in April 2024, he was
informed that
the business had again been sold to a company called
Protecta, the Applicant herein, and that he was dissatisfied with the
change
of ownership in such a short space of time. He says that upon
discovering this, he then contacted Mr Ashley Boetius from Allsound
Security CC whom he had known for approximately eight years because
of their services at his business premises, with a view to
changing
services providers for his home on the condition that they would
match the rate that he was currently paying at Protecta.
He states
that the aforementioned was the reason for his move to another
security company and confirms that he had never met the
Respondent.
[17]
With regard to the remaining two clients, the Respondent states that
he has no knowledge of these cancellations
and an affidavit deposed
to by Mr Ashley Boetius of Allsound Security CC confirmed that they
have no knowledge of the clients mentioned.
Respondent also noted
that the Applicant failed to supply any proof of the cancellation of
these contracts, the reason for their
cancellation or any evidence to
substantiate his involvement in such cancellation.
[18] In
its submissions, the Applicant referred to
Magna Alloys and
Research (SA) (Pty) Ltd v Ellis
[1984] ZASCA 116
;
1984 (4) SA 874
at 897F- 898E and
Basson v Chilwain
[1993] ZASCA 61
;
1993 (3) SA 742
at 776A-J, and argued that
the restraint clause, although it can generally be regarded as unfair
and a stripping of one’s
rights, submitted that it was however
not contrary to public policy. The Applicant submitted that all that
the Applicant had to
prove was a valid agreement and that it was
breached and that if one has regard to the common cause facts, then
final relief ought
to be granted as it is clear that the Applicant
has a right to enforce the restraint agreement. The Applicant
submitted that the
Respondent had the entire client list on his cell
phone and that it was the Respondent that had to show cause why he
was not bound
by the restraint clause. He was privy to trade
connections and knew the mark-up of the Applicant, so was in a good
position to
under-cut the Applicant. Finally, the submission was made
that the Respondent entered into the agreement freely and voluntarily
and whilst he made amendments to the certain clauses of the
agreement, he did not alter the restraint of trade provision.
[19]
The
Respondent in turn referred me to two cases, viz.
Johnsson
Workwear (Pty) Ltd and Another v Williamson and Another
[2]
and
Digicor
Fleet Management (Pty) Ltd v Steyn
(722/2007)[2008]
ZASCA 105 (22 September 2008). He stated that he was not privy to any
private information or company secrets. He
did administrative work,
and was a technical manager in quoting and the installation of
alarms. With regard to the Knysna Quays
allegation, he submitted that
he did the quote but that the quote had to be referred to Mr
Potgieter who was at the company’s
head office in Witbank. He
also denied that he had the entire company list on his cellphone. He
submitted that he would get a contact
list of persons to call for the
day and usually he would receive about 25 contacts on his call log
for the day. It was untrue that
he had the entire company’s
customer list on his cellphone. He said prior to the buy-out, Mr
Gerard Kotze was involved in
the sales. His duties with Applicant was
purely as technical manager in the installation of camera systems. He
was not involved
in the marketing of the business. He
reiterated the reason for his resignation being the unhappiness about
the probation
period, whereas with the previous firm, he was a
permanent employee from the first day.
[20]
When asked if he would be able to secure other work outside of the
security industry, he stated that he has
no other education or
expertise outside of the security industry. Currently at Pezula
Private Estate, his job does not entail dealing
with customers or
doing quotations. The Estate also has no dealings with the Applicant
or Coastal Security. It is an off-site contract
of Allsound Security
CC and all of the Estate’s technical installations are done
through a company in Cape Town. I have to
add that whilst this latter
information was not included in the opposing affidavit, I was
cognisant of the fact that the Respondent
was an in-person litigant
and that in such instances, some lateral leeway must be afforded to
such litigants, unless there is a
manifest deviation from what was
stated in his opposing affidavit. I did not find this to be the case.
[21]
The general principles applicable to the enforcement of restraints of
trade are trite. In
Basson
supra
, Nienaber JA
identified four questions that should be asked when considering the
reasonableness of the enforcement of a restraint:
(a)
Does the
one party have an interest that deserves protection after termination
of the agreement?
(b)
If so, is that interest threatened by
the other party?
(c)
In that case, does such interest weigh
qualitatively and quantitatively against the interest of the other
party not to be economically
inactive and unproductive?
(d)
Is
there an aspect of public policy having nothing to do with the
relationship between the parties that requires that the restraint
be
maintained or rejected?
[22] In
Automotive Tooling Systems (Pty) Ltd v Wilkens and Others
2007
(2) SA 271
(SCA) at 277, the court, in assessing the definition of
proprietary interest stated as follows:
“
[8]
At issue in this case, therefore, is whether the appellant does have
a proprietary interest worthy of protection. An agreement
in
restraint of trade is enforceable unless it is unreasonable. It
is generally accepted that a restraint will be considered
to be
unreasonable, and thus contrary to public policy, and therefore
unenforceable, if it does not protect some legally recognisable
interest of the employer, but merely seeks to exclude or eliminate
competition. Proprietary interests capable of protection fall
into
two categories, namely trade connections of the business, and which
is made up of goodwill and relationships with customers,
potential
customers, suppliers and trade secrets, consisting of confidential
matters which would be useful for the carrying on
of the business and
which could therefore be used by a competitor if disclosed to it.
[3]
[23] In
Advtech Resources (Pty) Ltd t/a The Communication Personnel Group
v Kuhn & Another
[2007] JOL 20680
(C), the court held that an
employer’s protectable interests included trade secrets,
confidential information and customer
goodwill or trade connections.
The courts have also said that a fine line has to be drawn between an
ex-employee’s use of
his employer’s trade secrets and the
use by the ex-employee of his own expertise, know-how, skill and
experience.
[24]
I am
in agreement that in certain instances, restraint of trade clauses
ought and should be enforced. Nestadt JA in
Rawlins
and Another v Caravantruck (Pty) Ltd
[4]
,
stated
the position as follows: 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 leaves the employer's service
he could
easily induce the customers to follow him to a new business. There is
however a
caveat
.
In
Morris
(Herbert) Ltd v Saxelby
[1916]
1 AC 688
(HL) at 709 it was said that the relationship must be such
that the employee acquires
'such
personal knowledge of and influence over the customers of his
employer . . . as would enable him (the servant or apprentice),
if
competition were allowed, to take advantage of his employer's trade
connection
.
. .' This statement has been applied in our Courts. Thus whether the
criteria referred to in
Basson
are
satisfied is essentially a question of fact in each case, and in
many, one of degree. Much will depend on the duties of the
employee;
his personality; the frequency and duration of contact between him
and the customers; where such contact takes place;
what knowledge he
gains of their requirements and business; the general nature of their
relationship (including whether an attachment
is formed between them,
the extent to which customers rely on the employee and how personal
their association is) and whether there
is evidence that customers
were lost after the employee left as a direct result of the
employee.
[25]
In
casu
,
on the Respondent’s version, he had been in the employ of the
Applicant for less than two months ostensibly, having concluded
the
contract of employment on 5 April 2024 and exiting on 24 May 2024. He
most certainly did not have any time to obtain trade
secrets or
confidential information of the Applicant. In any event, he was a
technical manager with Coastal and had not been privy
to the sales or
marketing of the company. With regard to the allegation that the
Respondent knew the mark-ups of the Applicant,
the Applicant did not
deny that the Respondent only met the Knysna Quays representatives on
two occasions whilst they were obtaining
quotations from various
other service providers. In fact, the Applicant did not deal with the
allegations at all in its reply made
by the owner of Allsound
Security CC and the committee member of the Knysna Quays. In
instances such as this, the
Plascon
Evans
rule
[5]
finds application.
[26]
I am
also not swayed by the Applicant’s reliance on the portions of
the judgment in
Basson
as
stated. The arguments relied upon emanated from a dissent not of
substance, but of reasoning, by Botha JA who was of the view
that, as
concerns
onus
,
the covenantee, in
casu
the
Applicant seeking to enforce the restraint need do no more than to
invoke the provisions of the contract and prove the breach;
the
convenentor, the Respondent, seeking to avert enforcement is required
to prove on a preponderance of probability that in all
circumstances
of the particular case it will be unreasonable to enforce the
restraint and if the court is unable to make up its
mind, the
restraint will be enforced. Botha JA agreed with Eksteen JA’s
emphasis that the paramount importance of contracting
parties is
upholding the sanctity of contracts. Botha, JA however
disagreed with the statement that where parties contract
on a basis
of equality of bargaining power, the principle of
pacta
sunt servanda
will
find strong application. Equality of bargaining power cannot affect
the nature of the onus; it is only relevant as one of the
multitude
of factors to be taken into account in the enquiry of reasonableness
of the restraint. In the main judgment, Eksteen
JA however held that
where parties to an agreement in restraint of trade contract on a
basis of equality of bargaining power, without
the one party being
inhibited by what one might regard as a position of inferiority as
against the other party, Courts will be
less inclined to find that a
clause, which may be considered to work unreasonably
inter
partes
,
is contrary to public policy and therefore unenforceable, than in the
case where one of the parties may well be considered to
have
contracted from a position of inferiority.
[6]
On the facts of this case, it is evident from the Respondent’s
affidavit that he had no knowledge that the company had been
sold,
and was presented with a new contract of appointment on the day that
he arrived at work to find the new business owners.
When perusing the
employment contract, he questioned certain clauses which dealt
inter
alia
with
office hours, remuneration and transfer of employment. These
questions, according to him, remained unanswered. More
importantly though, the new contract included a three-month probation
period, which was never included in the previous contract
of
employment where he was accepted as a permanent employee from the
start. This in my view is a clear indication that the parties
were
not bargaining on an equal footing and most certainly on the
evidence, it can be well inferred that the Respondent was contracting
in a more inferior position
viz-a-viz
the
Applicant. The Respondent was told to delete his changes and initial
same and told to change the date of employment to 4 February
2024
although it is common cause that this was not the date on which the
Respondent was even aware of the existence of the Applicant.
Indicative is also the fact he was compelled to sign the probation
clause which he was unhappy about and which was ultimately the
reason
for his resignation from the company a mere six weeks later.
[27]
The next consideration is whether the Applicant has trade secrets
worthy of protecting. It is generally accepted
that a person should
be free to engage in useful economic activity and contribute to the
welfare of society, and I would submit,
to the welfare of his family,
by the exercise of the skills to which he has been trained. Any
unreasonable restriction on such
freedom would generally be regarded
as contrary to policy. The Respondent has been employed in the
security industry for fifteen
years which duties included the
quotation and installation of security products such as alarms. He
has no other qualifications.
If one has regard to the restraint of
trade clause, the period of restraint is for a period of three years
and has no geographical
limitations; in others words, the Respondent
in terms of the clause would be barred from being employed in the
security, countrywide,
for a period of three years. I am of the view
that this clause is contrary to public policy because of the length
of the restraint
and lack of jurisdictional curtailment. Thus as it
now stands, the Respondent would be retrained from working in the
only industry
that he has known, and for skills he is only possessed,
for a lengthy duration throughout the country. Given the fact that
the
Applicant only operates in the Knysna district to the extent that
its client base is operational there, it defies logic why the
Respondent would be restrained from working, in say Cape Town for
another security company, for as the clause now currently provides,
any company which provides the same or similar services as the
Applicant would be precluded from offering the Respondent employment.
[28]
Our
courts have also held that seniority of the employee concerned is
also an important consideration when it comes to evaluating
the
existence of a protectable interest.
[7]
So where a person is a ‘mere employee’, in other words,
he is not an employee privy to decision making in the company,
or
privy to trade secrets, then the courts will be less inclined to
impose such a restraint. In
casu
,
the Respondent was employed by the Applicant for less than two
months; the skills and knowledge that he derived is common knowledge
in the particular industry and the supplier connections are common to
all security companies. I am thus satisfied that there are
no trade
secrets or confidential information belonging to the Applicant which
the Respondent was privy too. As I mentioned, these
are standard to
the industry.
[29]
The Applicant has also not proved that the losing of its clients, is
directly linked to the employment of
the Respondent by Allsound
Security CC and that the Respondent is in possession of the
Applicant’s client list. On the Respondent’s
admitted
version, he was tasked with a call log of clients to contact on a
daily basis. These were sent to his cellphone. I am
not persuaded
that the Respondent was possessed of confidential information
relating to customers.
[30]
Furthermore,
our courts have found that trade connections were an interest worthy
of protecting where the employee would have access
to customers and
is in a position to build up a particular relationship with the
customer so that when he or she leaves, the employee
could readily
induce that customer to follow the employee to the new business
venture
[8]
; simply put, if
there such a strong connection with a customer that such customer
would be persuaded to follow the employee to
the new venture. The
undisputed evidence of the owner of Allsound Security CC, Mr. Nurse
is that Allsound Security has had the
Knysna Quays as its client for
eight years. So too was the evidence of Mr. Smith in his affidavit
where he stated that he had been
a client of Allsound for eight years
in respect of his business property. It is thus evident that the
competing company, Allsound
Security CC, has its own established
customer base.
[31]
In
this matter, to me it seems as if the fundamental question to be
asked is whether the Respondent’s employment with Allsound
Security CC will in any manner, infringe upon the Applicant and any
protectable rights that it may claim. This is a public policy
issue.
As was stated in
Jonsson
Workwear
supra
[9]
even
if the Applicant is found to have a protectable interest, it is
factual question based on what the Respondent tasks would actually
be
and what possible risks the Applicant would be exposed to if the
Respondent is allowed to remain employed with Allsound Security
CC.
This has to be determined on the existence of the actual
infringement, on the facts.
[32] In
casu
, the Respondent is employed off-site at Pezula Private
Estate and performing duties that would not infringe on any of the
Applicant’s
protectable interest. Counsel for the Applicant
argued that that might be the case whilst he is so employed at that
site, but nothing
precludes him from being shifted to the main office
of Allsound in the same or similar position as he held at the
Applicant. I
am of the view that on all of the facts of this matter,
that so long as the Respondent remains at Pezula, that he would not
be
infringing the Applicant’s protectable interests and that
enforcing the restraint of trade would be contrary to public policy.
I have already found the restraint to be unreasonable for the reasons
stated. I am however of the view that should the Respondent’s
duties change from being employed at the off-site client of Pezula,
that the restraint should be enforced but that it should be
limited
for a period of twelve months to the area of jurisdiction of the
Southern Cape region.
[33]
With relation to costs, I am of the view that since both parties were
partially successful, that each party
should be liable for their own
costs.
[34] In
the circumstances, I make the following order:
ORDER
1. The
application for the relief sought in the notice of motion is
dismissed to the extent ordered in paragraph
2 hereunder.
2. In
the event that Respondent is no longer stationed at Pezula Private
Estate and remains in the employ of Allsound
Security CC performing
work the same or similar to that of Technical Manager, then in that
event, the Respondent will be interdicted
and restrained until 23 May
2025 and limited to within the Southern Cape district of the Western
Province as per clause 3.1 and
3.2 of the notice of motion, for a
period of twelve months calculated from the date of resignation,
being 24 May 2024.
3. Each
party to pay their own costs.
D.S KUSEVITSKY
JUDGE OF THE WESTERN
CAPE HIGH COURT
COUNSEL FOR
APPLICANT
: ADV.
R BRITZ
ATTORNEY FOR
APPLICANT
: NATASHA
: BRANDON-SWANEPOEL
ATTORNEYS
CORRESPONDENCE
ATTORNEYS : GAWIE
: CHENNELLS ALBERTYN
ATTORNEYS
COUNSEL FOR
RESPONDENT
: IN PERSON
[1]
This is an entry level security grading necessary for patrol and
guarding services.
[2]
Labour Court judgment D 426/2013 [2013] ZALCD 24; (2014) 35 ILJ 712
(LC) (12 August 2013)
[3]
Sibex Engineering Services (Pty) Ltd v Van Wyk and Another
1991 (2)
SA 482
at 502D-F
[4]
[1992] ZASCA 204
;
1993 (1) SA 537
at 541c-i
[5]
Plascon-Evans Paints Ltd v Van Riebeeck Paints (Pty) Ltd
[1984] ZASCA 51
;
1984 (3) SA
623
(A) at 634H-635C
[6]
Basson at 762I-J to 763A-B
[8]
Rawlins supra at 541D
[9]
at para 50
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