Auto Parts Group Pty Ltd v Cooper

Auto Parts Group Pty Ltd brought an action against Cooper, the first and second respondents, and a third respondent, a competitor in the automotive parts industry. The applicant alleged that the respondents breached their employment contracts by working for the third respondent, which contained a restraint of trade clause. The respondents argued that the restraint clause was unreasonable and therefore unenforceable. The court was required to determine whether the respondents were in breach of their previous contracts of employment and whether the restraint of trade clause was reasonable.

The court considered the nature of the restraint of trade clause, its duration, and the extent of the geographical restriction. It was noted that the clause was broad and did not limit the respondents' ability to work in the automotive parts industry altogether. The court also considered the legitimate interests of the applicant in protecting its business and intellectual property. The court found that the restraint of trade clause was reasonable and enforceable to the extent necessary to protect the applicant's legitimate business interests. However, the court considered that the restraint went beyond what was necessary to protect those interests and was therefore unreasonable and unenforceable to the extent that it prevented the respondents from working in the automotive parts industry altogether.

The orders of the court were that the applicant was to file and serve a form of order reflecting these reasons for judgment on or before 9 June 2015. If any respondent disagreed with the applicant's proposed form of order, then that party was to file and serve any proposed form of order on or before 12 June 2015. On or before 17 June 2015, each party was to file and serve such written submissions as they wished with respect to the proposed form of order, including any submissions as to costs. The proceeding was to be listed for further hearing on any outstanding matters arising from the proposed forms of order and submissions at 9.15am on 19 June 2015. Until the forms of order were finalised in accordance with the previous orders, the first and second respondents were restrained from attending any premises operated or maintained by the third respondent and from communicating with that company or any agent representative employee or related entity of that company other than for the purpose of obtaining legal advice or as may be necessary for the conduct of the proceeding. The parties had liberty to apply on 24 hours notice.