Ainsworth Nominees Pty Ltd (T/A Aristocrat Leisure Industries) v Crouch

Ainsworth Nominees Pty Ltd (trading as Aristocrat Leisure Industries) was the appellant in proceedings before the New South Wales Court of Appeal, which concerned a dispute with the respondent, Crouch. The core of the disagreement related to the interpretation and enforceability of a restraint of trade clause within an employment contract.

The Court of Appeal was required to determine whether the restraint of trade clause, which sought to prevent the respondent from engaging in competitive activities following the termination of his employment, was reasonable and therefore legally enforceable. Specifically, the court had to consider the scope and duration of the restraint in light of the respondent's role and the legitimate business interests of the appellant.

The Court of Appeal found that the restraint of trade clause was unreasonable and therefore void. The court reasoned that the clause extended beyond what was necessary to protect the appellant's legitimate business interests, such as its trade secrets and customer connections. The breadth of the restriction, both geographically and in terms of the activities prohibited, was considered to be wider than reasonably required to safeguard the appellant's proprietary interests, leading to the conclusion that it placed an undue burden on the respondent's ability to earn a living. The appeal was dismissed.