Cushman & Wakefield Agency (NSW) Pty Ltd v Hudson (No 2) - [2023] NSWSC 884

Supreme Court

New South Wales

Medium Neutral Citation: Cushman & Wakefield Agency (NSW) Pty Ltd v Hudson (No 2) [2023] NSWSC 884
Hearing dates: 17, 18,19, 21 April 2023; supplementary written submissions ending 24 April 2023
Date of orders: 28 April 2023
Decision date: 28 July 2023
Jurisdiction: Equity - Expedition List
Before: Parker J
Decision:
See [317]-[318]

Catchwords:
COMMERCE – Restraint of trade – validity and reasonableness – length and scope of restraint – where garden leave and post-employment restraints protecting customer connection – where employee in Sydney CBD market for office leasing – scope and duration of restraints limited – whether discretionary grounds made out
CONTRACTS – formation – intention to create legal relations – whether signature evidence of assent to entire document or qualified – where contract sent as one PDF attachment – where employee signed one space asking for signature – objective intention to be bound by entire contract
EMPLOYMENT AND INDUSTRIAL LAW – contract – terms – whether restraint and notice provisions vitiated by misleading and deceptive conduct – prior conversations relied on as representations – whether representations proven – representations not proven – whether restraint and notice provisions should be rectified for common mistake – common intention not established – whether walk out constituted acceptance of repudiation – walk out not clear and unequivocal acceptance

Legislation Cited:
Competition and Consumer Act 2010 (Cth), sch 2 (Australian Consumer Law), ss 18, 31, 237, 243
Fair Work Act 2009 (Cth)

Cases Cited:

Amoco Australia Pty Ltd v Rocca Bros Motor Engineering Co Pty Ltd (1973) 133 CLR 288

Application of Walker Corporation Pty Ltd [2022] NSWSC 160

Charltons CJC Pty Ltd v Fitzgerald [2013] NSWSC 350

Concrete Constructions (NSW) Pty Ltd v Nelson (1990) 169 CLR 594

Cushman & Wakefield Agency (NSW) Pty Ltd v Hudson [2023] NSWSC 218

Downe v Sydney West Area Health Service (No 2) (2008) 71 NSWLR 633

Dundoen Pty Ltd v Richard Wills (Real Estate) Pty Ltd [2020] NSWSC 1534

Extraman (NT) Pty Ltd v Blenkinship (2008) 23 NTLR 77

Hanna v OAMPS Insurance Brokers Ltd (2010) 202 IR 420

Idameneo (No 123) Pty Ltd v Angel-Honnibal [2002] NSWSC 1214

Immer (No 145) Pty Ltd v Uniting Church in Australia Property Trust (NSW) (1993) 182 CLR 26

In the matter of the George Hardi Family Trust [2021] NSWSC 1584

Isaac v Dargan Financial Pty Ltd (2018) 98 NSWLR 343

Jardin v Metcash Ltd [2011] NSWCA 409

Koops Martin Financial Services Pty Limited v Reeves [2006] NSWSC 449

Lane v Arrowcrest Group Ltd (1990) 27 FCR 427

McMurchy v Employsure Pty Ltd [2022] NSWCA 201

OAMPS Insurance Brokers v Hanna [2010] NSWSC 781

Otis Elevator Company Pty Ltd v Nolan [2007] NSWSC 593

Self Care IP Holdings Pty Ltd v Allergan Australia Pty Ltd (2023) 97 ALJR 388

Simic v New South Wales Land and Housing Corporation (2016) 260 CLR 85

Stellar Vision Operations Pty Ltd v Hills Health Solutions Pty Ltd [2023] NSWCA 102

Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd (2004) 219 CLR 165

TP ICAP Management Services (Australia) Pty Ltd v Howell [2021] NSWSC 656

Tullett Prebon (Australia) Pty Ltd v Purcell (2008) 175 IR 414

Walker v Salomon Smith Barney Securities Pty Ltd (2003) 140 IR 433

Watson v Foxman (1995) 49 NSWLR 315

Texts Cited:

M Leeming, “Subjective intention in the law of contract – its role and limits” (Speech, Bar Association of Queensland, University of Queensland and Supreme Court of Queensland Library, 1 June 2023

Meagher, Gummow & Lehane’s Equity Doctrines & Remedies Heydon JD, Leeming MJ and Turner PG, (5^th ed, 2015, LexisNexis Butterworths) [21-195]

Category: Principal judgment
Parties: Cushman & Wakefield Agency (NSW) Pty Ltd (Plaintiff/First Cross-Defendant)
Rosa-lyn Hudson (Defendant/Cross-Claimant)
Timothy James Molchanoff (Second Cross-Defendant)
Representation:
Counsel:
D Mahendra/JVM Smith (Plaintiff/Cross-Defendants)
BK Nolan (Defendant/Cross-Claimant)
Solicitor:
King & Wood Mallesons (Plaintiff/Cross-Defendants)
Green & Associates (Defendant/Cross-Claimant)

File Number(s): 2023/76041
Publication restriction: Nil

JUDGMENT

This is a restraint of trade case which I heard in late April. The matter needed to be decided urgently because an interlocutory injunction was due to expire in early May. On 28 April, I announced my decision and made orders. I indicated that I intended to publish formal reasons in due course. These are those reasons.
The plaintiff is Cushman & Wakefield Agency (NSW) Pty Ltd (“C&W NSW”). It is the local subsidiary of the Cushman & Wakefield group of companies (“C&W”). The group carries on a multi-national commercial real estate services business which is headquartered in Chicago. In this judgment I will not distinguish between the various C&W companies unless it is necessary to do so.
The defendant is Rosa-lyn (known as “Rosie”) Hudson. Ms Hudson has worked in the commercial leasing industry for about eleven years, mainly in office leasing. She was employed by C&W from 2016 onwards. Her first role was as a Manager. In 2018, she was promoted to Associate Director. From the start of 2021, she held the position of Director.
There were three sets of contractual documentation which applied, or allegedly applied, to Ms Hudson’s employment. For convenience, I will refer to each set of documents as a “contract”. The first was a contract entered into prior to Ms Hudson commencing at C&W, and later amended in 2018 and 2020 (“the 2016 contract”). The second was a replacement contract entered when Ms Hudson was returning part-time from a period of maternity leave (“the 2021 contract”). The third was a contract drawn up when Ms Hudson was returning full-time from a further period of maternity leave (“the 2022 contract”). It is common ground that the 2016 contract, and then the 2021 contract, governed the employment relationship between the parties. Whether, and to what extent, the 2022 contract does so is the subject of dispute.
Ms Hudson resigned in early February this year, and was immediately “walked out” by C&W. She was escorted out of C&W’s premises, leaving behind the phone, computer and other property provided for her by C&W, and her access to C&W’s email system was removed.
The following day, C&W purported to direct Ms Hudson to treat herself as being on “garden leave” for a period of three months. This direction was based on the notice period in the 2022 contract (the contract provided that C&W might direct Ms Hudson to go on garden leave for such part of the notice period as it chose). C&W also stated, by way of reminder, that at the end of the three-month garden leave period Ms Hudson would be subject to post-employment restraints for a further period of 12 months. Again, this period was based on the terms of the 2022 contract.
Correspondence ensued and the parties retained solicitors. Ms Hudson disputed the contractual validity of the notice and post-employment restraint periods in the 2022 contract, as well as the enforceability of the restraints generally.
Ms Hudson had resigned from C&W after having accepted an offer of employment from another international real estate firm, Jones Lang LaSalle (“JLL”). There is no dispute that JLL is a competitor of C&W in the Sydney commercial leasing services market. C&W commenced these proceedings, and obtained ex parte interlocutory injunctive relief, in early March. This was at about the same time as Ms Hudson started, or was to start, work for JLL. Among other things, the injunction restrained Ms Hudson from working for JLL until 3 May or further order.
Ms Hudson sought, before Richmond J in the Duty List, to have the injunction discharged – that application was the subject of the first judgment in these proceedings: Cushman & Wakefield Agency (NSW) Pty Ltd v Hudson [2023] NSWSC 218, paragraphs of which are referred to in this judgment by using “J1”. Her application was unsuccessful. Instead, his Honour continued the ex parte injunctions against her, with minor modifications to C&W’s undertakings.
This judgment is concerned with the claims for relief which were the subject of an expedited hearing in April. That hearing, which took place on 17, 18, 19 and 21 April, was confined to claims requiring expedited determination.
Due to the urgent nature of the proceedings, I decided to announce my conclusions and make orders in the proceedings as quickly as possible, with reasons to follow in due course. As already noted, I announced my conclusions on Friday 28 April and made orders on that date disposing of the expedited claims. I granted injunctions against Ms Hudson, albeit that those injunctions were less extensive than C&W had sought. But I stayed the operation of the injunctions until 6pm on Monday 1 May, and adjourned the proceedings until 4pm on that date. This was to enable Ms Hudson to consider whether to seek a further stay of my orders pending an appeal (which had been foreshadowed during final submissions as a possibility), in circumstances where her counsel had been unable to appear on 28 April.
The listing on 1 May was, in the event, vacated by consent shortly before it had been due to begin. No application for a further stay was made and no appeal was foreshadowed. In accordance with a consent minute of order submitted by the parties, the proceedings were removed from the Expedition List and listed before the Registrar in Equity for directions as to the balance of the proceedings. But on 5 June the Registrar made further orders by consent disposing of the remaining claims and directed that the file be closed.
By this point, although I understood that formal reasons for judgment were required in due course, I was unaware of any appeal. It was only in late June that I was notified that Ms Hudson was appealing and wanted the delivery of the judgment expedited.

Claims and issues for determination

C&W’s main claims against Ms Hudson in the proceedings were based on the 2022 contract, and specifically the notice and post-employment restraint periods specified in that contract. Those claims were resisted by Ms Hudson on various grounds. Some of those grounds were the subject of a cross-claim. As well as C&W, Ms Hudson joined Timothy James Molchanoff as a cross-defendant. Mr Molchanoff was (and remains) the head of the department where Ms Hudson worked at C&W. She alleged that there had been misleading and deceptive conduct in connection with the negotiation of the 2021 and 2022 contracts for which both C&W, and Mr Molchanoff personally, were liable.
As already mentioned, only some claims in the proceedings were the subject of the expedited hearing. The remainder were left for later determination. These included C&W’s claims for damages for breach of the restraints. They also included Ms Hudson’s claims for damages for breach of contract (against C&W) and under the Australian Consumer Law (Competition and Consumer Act 2010 (Cth), Sch 2) (“ACL”) (against C&W and Mr Molchanoff). They also included a claim by C&W for the re-payment of part of a retention payment which it made to Ms Hudson in 2020.
At the expedited hearing, C&W pressed for the grant of final injunctions covering the balance of the notice period specified in the 2022 contract (that is, for three months, expiring on 3 May), and thereafter for a further nine months, up to 3 February next year. C&W did not seek to enforce the post-employment restraints for the last three months of the 12-month period specified in the 2022 contract.
The first issue for determination was whether the notice and post-employment restraint periods specified in the 2022 contract were binding on Ms Hudson as a matter of contract law. Ms Hudson contended that she had never assented to them in a contractually valid way; as a result, the 2021 provisions (a one-month notice period and a one-month post-employment restraint period) continued to apply. In her cross-claim, she sought declaratory relief accordingly.
Ms Hudson next contended that if the 2022 contract was binding as a matter of contract law, it was liable to be rectified. In her cross-claim, she sought orders rectifying the 2022 contract which would have the effect of replacing the notice and post-employment restraint periods with those specified in the 2021 contract. This rectification claim was the second issue for determination.
The third issue concerned claims of statutory misleading conduct. Ms Hudson contended that she entered the 2022 contract in reliance on representations made in 2021 and 2022 which led her to believe that the terms of her 2021 contract, or alternatively, the notice and post-employment restraint periods in that contract, were unchanged in the 2022 contract. Ms Hudson contended that, if the 2022 contract was binding as a matter of contract law and the rectification claim failed, those representations had been misleading, and C&W had contravened the ACL. Ms Hudson sought relief under ss 237 and 243 of the ACL which would, in effect, prevent C&W from enforcing the notice and post-employment restraint periods in the 2022 contract.
The fourth issue concerned whether, and if so, when, the 2022 contract had been terminated. Ms Hudson contended that if she was bound by the 2022 contract, she had repudiated it by giving four weeks’ notice, and C&W had accepted this termination by the “walk-out”. It followed, according to this contention, that there was no garden leave period and the post-employment restraint period started to run immediately.
The fifth issue concerned the reasonableness of the restraints in the 2022 contract. Both scope and duration were in issue, both during the garden leave (if any) and the post-employment periods.
Finally, Ms Hudson contended that, to the extent that the restraints were valid and enforceable, injunctive relief should be refused on discretionary grounds. This was the sixth issue for determination.

Summary and analysis of evidence

Chronology of key events

Ms Hudson left school in around 2008. She has a bachelor’s degree in property economics, which she completed while working full-time. She also has a certificate IV in real estate, which she completed while still at school.
Since 2011, she has worked for two multinational commercial leasing agency firms – Coldwell Banker Richard Ellis (“CBRE”) and C&W. Her work at both firms focused on office leasing in the Sydney CBD market. Evidence was given about the nature of C&W’s business in that market. It was however apparent that the evidence was equally applicable to other agencies in the market.
Typically, a commercial leasing agency has two features to its leasing business. One feature involves working with tenants. Part of this is “tenant representation” – that is, representing tenants who appoint the agency to be their “tenant representative”. Tenant representatives circulate information about the tenant and their requirements, to landlords and other agencies. The agency may also represent “brokerage tenants”– prospective tenants, without tenant representatives – in transactions, assisting with the brokerage of leases.
The other feature of an agency’s business is concerned with filling vacancies in buildings for landlords. The agency competes with other agencies for “appointments” on buildings. If appointed, the agency enters an agreement with the landlord. The evidence indicated that these agreements are normally for around twelve months, with a one-month notice period. It is not uncommon for two agencies to be jointly appointed.
The agency is not paid for the mere fact of appointment. The appointing landlord pays the agency a fee when it successfully fills a vacancy in the relevant building. The fee is calculated based on the terms of the agreement between the agency and the landlord. It commonly depends on factors such as: tenancy length, revenue generated, tenancy size, tenure of transaction, and rent value.
It was uncontested that the Sydney CBD commercial leasing agency services market is highly competitive. In particular, there is strong competition for obtaining appointments and filling vacancies. Many of the agencies are multinational firms. The work appears to be lucrative and the poaching of staff between agencies appears to be commonplace.
When Ms Hudson joined CBRE, she began as a junior member of CBRE’s office leasing team. Initially she was an Analyst. Later she was promoted to a Negotiator. I understood that she was not working in landlord appointments while at CBRE. In particular, the evidence indicated that Ms Hudson was largely working with brokerage tenants during her time as a Negotiator.
Mr Molchanoff was, at the time, the head of CBRE’s office leasing team. In late 2015, he was headhunted by C&W to become its National Head of Leasing. When he moved from CBRE to C&W, Mr Molchanoff brought some members of CBRE’s office leasing team with him. These included two senior agents, Tim Courtnall and Mr Jamie King, and Ms Hudson.
In March 2016, Ms Hudson commenced at C&W as a Manager in the NSW Leasing department, having signed a contract in January. She was initially employed by a C&W company named DTZ Pty Limited (“DTZ”). I summarise the 2016 contract below at [63].
When, or soon after, Ms Hudson moved to C&W, she began working on the appointments side of the business. The remuneration of agents working on appointments has two components: a fixed component (base salary), inclusive of superannuation; and a commission-based component. Again, although the evidence mainly concerned C&W’s practices, the basic structure appears to be common among firms operating in the market.
When C&W is appointed on a building, it usually designates two of its agents to handle the appointment. Those agents agree among themselves on a fee-sharing arrangement. Fees were ordinarily split 50/50 between two agents. But there were exceptions – for example, while on maternity leave, Ms Hudson received a 15% split on a transaction. There was also evidence of agents other than those appointed sometimes being included in the fee-sharing arrangement – for example, where a non-appointed agent introduced a tenant to the building.
A share of the fee received by C&W from filling a vacancy in a building on which it is appointed goes to the respective agents, in accordance with the fee-sharing arrangement. The agents do not directly pocket their share of the fee. Instead, it goes towards an agent’s annual “personal fees” pool. Each agent then has a “commission structure” which outlines when, and if so at what rates, agents are entitled to commission on their annual fee pool.
The commission structure is based on comparisons between the annual fees pool and an agent’s base salary multiplied by specified amounts (multipliers). If the fees pool total does not exceed the base salary multiplied by the initial multiplier, then the agent earns no commission – the relevant threshold can be thought of as a commission-free component of the fee pool. Fees above that threshold attract commission at a specified rate. Commission structures can have multiple bands, with different (normally, increasing) rates.
By way of explanation, under Ms Hudson’s 2016 contract, her base salary was $80,000 (including superannuation). The commission-free part of her fee pool was 2.5 times her base salary – that is, $200,000. For fees above that amount, she earned 40% commission, except for fees above 4 times her base salary, on which she earned 50% commission. So, on fees above $200,000 and below $320,000, she earned 40% commission. Above $320,000, she earned 50% commission. For 2016 and 2017 only, C&W agreed to underwrite a minimum commission income of $320,000 which would yield a commission payment of $48,000 per annum.
In May 2018, Ms Hudson was promoted to Associate Director, and her base salary was increased to $100,000. This took effect from July. Her employing entity was also changed from DTZ to C&W NSW (but on the basis of continuity of employment since 2016).

From July 2020, Ms Hudson went on maternity leave for the birth of her first child. In December, while still on leave, Ms Hudson was promoted to Director, with effect from January 2021. She also received a retention payment of $350,000, subject to remaining at C&W until the end of 2024 (with exceptions). If she left earlier, she would have to repay a specified amount – the proportion depended on when she left. Relevantly, having left in 2023, Ms Hudson was liable to repay 50%. The evidence showed that this payment was made because Ms Hudson, along with others in the New South Wales leasing team, had been contemplating leaving C&W and returning to CBRE.
At the same time, Ms Hudson received a change in her commission structure. It remained the case that she was only entitled to commission if her fee pool exceeded 2.5 times her base salary. The relevant change was that she would earn 50% commission on any part of her fee pool above that threshold.
Mr Courtnall returned to CBRE in late 2020. Ms Antonia Foweraker took his place as the New South Wales leasing manager, reporting to Mr Molchanoff. Ms Foweraker had been working for C&W since 2006.
In February 2021, in anticipation of returning from her maternity leave (which occurred in about March), Ms Hudson entered into a flexible working arrangement with C&W. She later entered a new contract, which she signed in April. I summarise the contract in more detail below. Under it, Ms Hudson’s title was unchanged, but her hours were reduced to 30.4 hours per week, spread over four days, and her base salary was reduced, pro rata, to $80,000 including superannuation. Her commission structure was unchanged.
Ms Hudson made handwritten amendments to the 2021 contract before signing it. She altered the notice period from twelve weeks to four and the restraint period from three months to one (this was largely consistent with her 2016 contract – albeit that it had a one month notice period instead of four weeks). It appears that these amendments were accepted by C&W, there being no evidence to the contrary.
Ms Hudson also gave evidence of conversations with Mr Molchanoff in January and April 2021, before entering the 2021 contract (see below at [75]-[76]).
In February 2022, Ms Hudson took maternity leave for the birth of her second child. In anticipation of her return to work full-time (on 16 August) she wrote to Ms Foweraker in July seeking a pay rise (extracted below). The pay rise was approved by C&W’s Managing Director, Mr Simon Fenn, on 4 August. C&W HR facilitated the request and prepared a new contract. This comprised an agreement dated 9 August (with an annexure), and a covering letter dated 10 August, in a single PDF. The contract was sent to Ms Foweraker on 11 August, who was asked to review it and raise any issues. At some time after this (the precise time is unclear on the evidence), the contract was issued to Ms Hudson.
I summarise the relevant provisions of the 2022 contract below at [91]. Significantly, it contained longer notice and restraint periods. The notice period was three months. The restraint period was up to twelve months. Ms Hudson gave evidence that she was unaware of these changes at the time of signing the 2022 contract, because she did not read it in its entirety. She only gave positive evidence of having read the annexure, which set out how her commission would be determined. Ms Hudson made electronic amendments to that annexure. She signed in the only space for signature at the bottom of that annexure and dated it 12 August.
On 17 August, a member of C&W HR followed up Ms Foweraker, by email, about having not yet received Ms Hudson’s signed contract. Nine minutes later, Ms Foweraker replied attaching the signed contract.
Ms Hudson gave evidence of conversations which she had with Ms Foweraker prior to entering the 2022 contract. Ms Foweraker also gave evidence of such conversations, as well as conversations which she had with Mr Molchanoff. The conversations are set out at [119]-[120].
It appears that C&W did not detect Ms Hudson’s amendments to the commission structure until early September. This was discussed in internal correspondence, culminating in a letter of 20 September, self-described as an addendum to the 10 August letter. It set out a revised commission structure schedule, consistent with the amendments made by Ms Hudson. It was signed by Ms Hudson on 20 September.
Ms Hudson received a formal letter of offer from JLL on 30 January, including terms. She gave evidence, however, that JLL first approached her in June last year, and she had been considering the possibility of moving there even before asking C&W for a pay increase. The evidence does not indicate when the negotiations resumed. A further offer was sent on 1 February which appears to have been in similar terms to that of 30 January. Ms Hudson appears to have accepted it on 1 February. She was to commence employment on 2 March, as a “Senior Director, Office Leasing NSW”.
It appears that Ms Hudson provided oral notice on 1 February, in a meeting with Mr Molchanoff. She was “walked out” later that day (see above). The same occurred for Ms Foweraker and Mr King who had accepted offers from JLL at the same time (I infer that the departure of the three of them was coordinated).
Ms Hudson then sent a letter of resignation by email, to Mr Molchanoff, on 2 February, dated 31 January. She purported to give four weeks’ notice. I extract the letter below at [155].
C&W sent Ms Hudson a letter dated 3 February, by post and email (although it only appears to have been emailed on 6 February) and signed by Mr Molchanoff. C&W acknowledged Ms Hudson’s resignation, referred to a three month notice period (consistently with the August 2022 contract) and instructed her that she would “remain on Garden Leave for the remainder” of that period. This involved not attending C&W’s premises, not performing any work, and not making contact with any C&W staff, customers or clients.
Ms Hudson was informed that C&W might still contact her to request employment-related information, and she was required to make herself available to attend to those matters if required. She would continue to be paid her usual base salary and superannuation contributions, together with any accrued entitlements to commission. The letter also reminded her of her post-employment obligations, and again, consistently with the August 2022 agreement, advised that these would extend for a period of twelve months. I extract the letter below at [156].
On 7 February, Ms Hudson sent an email asserting that the notice and post-employment restraint periods were only one month. Correspondence was then exchanged between C&W and Ms Hudson, which I summarise below. During this time, Ms Hudson and Mr Molchanoff appeared to have had some communication via phone and text message.
Both parties retained solicitors, who exchanged correspondence, but no resolution was reached. Ms Hudson appeared to have begun employment with JLL on or about 2 March, the date specified in the offer she had accepted. These proceedings were commenced on 7 March, and Richmond J made his interlocutory orders on 13 March (see above).
The parties accepted that Ms Hudson was continuing to be paid her salary during the garden leave period. An undertaking was made to that effect before Richmond J.

Witnesses

Mr Molchanoff was the sole witness for C&W. He affirmed three affidavits and was cross-examined at length. Mr Fenn did not give evidence.
Ms Hudson affirmed five affidavits and was also cross-examined at length. Ms Foweraker and Mr King also gave evidence for the defence. Ms Foweraker affirmed three affidavits and was cross-examined. Mr King affirmed one affidavit but was not asked any questions in cross-examination.
There were attacks made during cross-examination and final submissions on the reliability of some of the evidence of Mr Molchanoff, Ms Foweraker and Ms Hudson. In Mr Molchanoff’s case, there appeared to be wider challenges to his credit.
I thought Ms Hudson’s demeanour when she gave evidence was somewhat defensive at times. As I describe below, she made significant additions to her affidavit evidence after the interlocutory hearing before Richmond J, and I did not find the way that she handled this in cross-examination at all convincing. There are some parts of her evidence about the precise sequence of events and the precise language which I have not accepted; and overall, she seemed to me to have little, if any, actual recollection of such details (which would not be surprising in the circumstances). Generally, I approached her evidence with caution.
It was evident that Ms Foweraker was a close personal friend of Ms Hudson and was very protective of her. It was equally clear that Ms Foweraker strongly felt that Ms Hudson had been treated poorly by C&W. These factors may well have coloured her evidence. I was also left with the impression that she had little actual recollection of key details. Again, I approached her evidence with caution.
It is not necessary to go into Mr Molchanoff’s credit in any detail. His evidence on the disputed events and conversations, so far as it went, seemed to me not to have been seriously undermined in cross-examination. In the end he did not profess to have any great recollection of the detail of disputed conversations. But C&W’s case did not depend upon him doing so.

2016 contract and variations

The 2016 contract took the form of an employment agreement dated January 2016. The agreement was styled “Executive Service Agreement” (ESA). It was in conventional form. After identifying the parties, it set out 23 operative clauses, then signature blocks where it was signed by both parties, followed by a schedule. The body of the agreement consisted of 8 pages and the schedule consisted of one page.
The agreement also contained an operative clause dealing with Ms Hudson’s remuneration entitlements, including commission. Details of her commission structure were set out in the schedule, which was headed “Schedule A – Commission”.
Among other things, the operative clauses also provided for a one-month notice period, during which Ms Hudson could be directed to take garden leave. It also contained post-employment restraints. Broadly speaking, these were non-competition, non-poaching, non-solicitation and non-interference restraints. The restraint period was one month. The restraint area was Australia (or alternatively, New South Wales or Sydney).
The 2016 contract was varied in 2018 and 2020, as described above. These variations were all made by letters that advised that all other terms remained unchanged.

2021 contract

Documentary evidence: The 2021 contract was preceded by a flexible working arrangement. A letter dated 3 February confirmed that Ms Hudson’s application for such had been approved and set out the terms of the arrangement. On its face, the letter (if accepted) was to form part of the terms of Ms Hudson’s 2016 contract (as amended). The arrangement was to last 12 months, commencing 1 March. If the arrangement ceased, the letter outlined, Ms Hudson would automatically revert to being covered by the 2016 contract terms (which was clarified to mean, on a full-time basis).
The 2021 contract comprised a two-page covering letter (dated 8 February), an eight-page employment agreement, and various annexures (confidentiality agreement, intellectual property assignment agreement, commission schedule and an individual flexibility agreement). The covering letter made clear that the contract was to replace Ms Hudson’s existing employment arrangements.
The employment agreement was in a similar form to the 2016 ESA. It contained 21 operative clauses. One difference was that there was no operative clause dealing with her base salary. The pro rata reduction in base salary was only dealt with in the cover letter (and reflected in the commission schedule). The reduction in Ms Hudson’s work hours (to 30.4 hours per week) was given effect in clause 10.
The attached individual flexibility agreement was made in accordance with clause 7 of the Real Estate Industry Award 2010 (“the award”). It made clear that while it was in force, the application of specific clauses of the award would be varied and explained those variations.
As I have mentioned, Ms Hudson made handwritten amendments to the 2021 contract, altering the twelve-week notice period and three-month restraint period to four weeks and one month, respectively. C&W could direct Ms Hudson to take garden leave for the notice period. The restraints were, broadly speaking, of a similar kind to those in the 2016 contract, with the addition of a non-solicitation restraint extending to potential customers or clients that C&W was cultivating at the time of termination, where Ms Hudson was directly or indirectly involved with the cultivation. The restraint area was Australia (or alternatively Sydney).
Ms Hudson signed the 2021 contract in April of that year (even though the commencement date was 1 March). There was no evidence that anyone at C&W actually noticed the handwritten amendments made by Ms Hudson and accepted them. But it appeared to be accepted that, objectively, C&W had accepted the amendments by conduct.
Witness evidence: Ms Hudson gave the following evidence about the 2021 negotiations in her first affidavit, affirmed 9 March this year:

Prior to my return to work, I negotiated new employment terms with the Plaintiff, because I only wanted to work four days per week. My base salary was reduced on a pro rata basis to $80,000 and the four days was reflected in my contract, as per my original 2016 contract. Exhibited … is a copy of the employment agreement I was given on 8 February 2021. I noticed that the contract had increased my notice and restraint period from one month to three months, and I resisted this and negotiated it back down to one month, as per my original 2016 contract. There are hand-written notes on the agreement made by me that reflect this.

As I describe below, Ms Hudson went on to claim in the affidavit that she did not read the notice and post-employment restraint clauses in the 2022 contract, because she thought that no terms were changing apart from those concerning her remuneration. But Richmond J, in his interlocutory judgment, pointed out that Ms Hudson had presented no evidence of any written or oral representations to that effect from C&W.
On 31 March, following the delivery of his Honour’s judgment, Ms Hudson affirmed a third affidavit. In that affidavit she stated that she had the following conversation with Mr Molchanoff in January 2021, while still on maternity leave (emphasis added):

[Hudson]: 'Molch I want to come back, but only 4 days. Is that ok? I'm happy to go pro-rata?'
Molchanoff: 'Yeah that's fine, I'll discuss it with HR and come back to you.'
[Hudson]: 'Ok. No other terms to change. I'll just do 4 days and reduce pro-rata.'
Molchanoff: 'Yeah easy.'

In her third affidavit Ms Hudson also gave an account of conversations with Mr Molchanoff in April 2021 (emphasis added):

I returned to work in the office on 1 March 2021. On or about 7 April 2021 I had a conversation with Molchanoff to the following effect:
Molchanoff:    'Hey Rosie, HR has been following me up and said you haven't signed your new contract, so they can't process your pay until that's done. Just get it done today and we'll sort it out.'
[Hudson]:    ‘Oh, ok, will do’.
Molchanoff:    'Make sure you review the terms and any notice or gardening leave terms too, and make sure they're only one month like when we moved here from CBRE.'
I remember we were standing near the printer at the time. I then printed the contract.
Later that day, I reviewed the terms of the 2021 Contract and realised the notice period and post-employment restraint had been increased to three months. I then had another conversation with Molchanoff to the following effect:
[Hudson]:    ‘Molch, this says I have a three-month restraint and garden leave. I never agreed to this? Did you ask for it? What should I do?
Molchanoff:   ‘No, it was probably just Victor [Nguyen] in HR. Just cross it out in pen and write 4 weeks in there and give it back. Let Antonia know too. I'll tell HR and make sure this doesn't happen again'.
I then did what Molchanoff directed me to do, and crossed out and returned it to HR with hand-written amendments. I never heard anything back from them so assumed it was accepted.

Mr Molchanoff responded to this evidence in his April affidavit. Concerning the alleged January conversation, he affirmed:

While I recall a conversation with Ms Hudson in around late January 2021 focussed on the terms upon which Ms Hudson was seeking to return to work from maternity leave, I do not now recall the specifics of that conversation.

Concerning the first alleged April conversation, he affirmed:

In April 2021 it was necessary for me to speak with Ms Hudson to remind her to sign the Part-time Employment Contract. Ms Hudson and I did not have a conversation in the terms set out by Ms Hudson in that paragraph. We did not discuss the specifics of the employment contract such as the "notice or gardening leave terms ... " These are not matters that I have any specific knowledge or expertise in relation to, and any queries concerning those matters would need to have been raised by Ms Hudson with the HR team directly.

Concerning the second alleged April conversation, he affirmed:

Ms Hudson and I did not have a conversation in the terms set out by Ms Hudson in that paragraph. I do not recall whether I had two conversations with Ms Hudson or whether I only had one conversation with her that day, however I do recall saying to he during the course of our discussion about the employment contract words to the effect of: "If there is anything you wish to raise, mark up the document, initial it and return it to HR so that they can deal with it."

Mr Molchanoff was cross-examined about the conversations. He agreed that a conversation had occurred in January, that Ms Hudson had requested to come back four days per week and go pro rata, and that he had said that was fine, he would discuss with HR and come back to her. He did not, however, recall a conversation about all terms remaining the same.
He maintained that he had a conversation in April chasing up Ms Hudson to return the contract, because HR was yet to receive it. He did not recall discussing specifics about terms, including notice or garden leave terms. He recalled the conversation being in the general vicinity of the printer. He also did not recall Ms Hudson asking him about the three-month restraint and garden leave clauses. He maintained that he had said if she was not happy with parts of the contract, she should make alterations and send them back to HR. When he was asked if he remembered saying “No, it's probably just Victor--", meaning Victor Nguyen in HR, - "just cross it out in pen, write four-weeks there and give it back. Let Antonia know too, and I'll tell HR and make sure this does not happen again"”, he answered “I don’t recall that specific conversation, no”.
Ms Hudson maintained her accounts in a further affidavit. In cross-examination, it was put to her that she had come up with the alleged conversations after she had seen Richmond J’s decision. She denied this but did not offer any alternative explanation for why the evidence only emerged in her third affidavit.
Factual issues and conclusions: Ms Hudson relied on her evidence of conversations with Mr Molchanoff in April 2021 as establishing representations that formed part of her misleading and deceptive conduct claim. This gives rise to a factual issue – whether those accounts should be accepted.
I accept, as Mr Molchanoff conceded, that a conversation occurred in which he followed her up about having not signed her contract yet and that he asked her to review and return it. Mr Molchanoff, may have, as he suggested, advised Ms Hudson that if she wasn’t happy with any parts of the contract, she should alter it and send it back to HR.

But I am not willing to accept that Mr Molchanoff said, “I’ll tell HR and make sure this doesn’t happen again”, nor that he earlier said, “Make sure you review the terms and any notice or gardening leave terms too, and make sure they’re only one month like when we moved here from CBRE” (emphasis added). That is so notwithstanding that Mr Molchanoff gave evidence that he was unable to recall these aspects of the conversations rather than clearly denying them.
The following factors have informed that conclusion. First, there is no contemporaneous documentary evidence that the notice and restraint terms were discussed, let alone a representation made that they would remain the same.
Second, I think the context makes Ms Hudson’s account inherently implausible. The contractual documents were being drawn up by HR. The parties would have understood that this might have involved alterations to the terms, and that these alterations might not be purely formal (indeed, the whole reason for the preparation and execution of the 2021 contract was the need to record Ms Hudson’s shift to part-time work). Mr Molchanoff was not in charge of this process; Ms Hudson was dealing directly with HR. There would have been no reason for him to give her any assurances of his own about the terms.
Third, there is the circumstance that the critical alleged representations were not included in Ms Hudson’s initial affidavits and only appeared after Richmond J pointed other deficiencies in her evidence. I did not find Ms Hudson’s evidence about this in cross-examination convincing. The alleged conversations were an important part of Ms Hudson’s case for an injunction and there was no reason, if they occurred, for them not to have been referred to.
Finally, the alleged representations are very specific to the dispute which has emerged. They are almost too good to be true. The well-known observations of McLelland CJ in Eq in Watson v Foxman (1995) 49 NSWLR 315 at 318-319 about the frailties in oral evidence about earlier oral dealings are very much in point.
Although the January conversation was not pleaded as forming part of C&W’s misleading and deceptive conduct, I also reject Ms Hudson’s account of that conversation. For similar reasons, I am not convinced that it was agreed that no other terms would change. Such a statement was again overly specific, unsupported by contemporaneous evidence, responsive to deficiencies in Ms Hudson’s case on the interlocutory application, and unlikely to have been said in circumstances where Mr Molchanoff was not solely responsible for preparing new contracts.

2022 contract

Documentary evidence: The documentary evidence begins on 25 July 2022, when Ms Hudson emailed Ms Foweraker requesting a base salary increase ahead of her return to work full-time:

As discussed, I am planning to return to work next month and am requesting my base salary be increased to $180,000 exclusive of super per annum.
I have been working at Cushman & Wakefield for over six years and have consistently been one of the top fee earners within the leasing team and the overall business. Other than 2020, I have written over $800,000 per annum in fees for Cushman & Wakefield, writing $2,400,000 last year. Taking into consideration my current appointments and upcoming targets anticipate that will remain one of the top fee earners for Cushman & Wakefield.
I have calculated that childcare will cost me in excess of $96,200 per annum, therefore my current structure of $100,000 base salary is unfeasible. I need a secure monthly income to justify my return to fulltime work.
I would appreciate if you would put forward this request to management for approval prior to my return to work next month.
I look forward to hearing from you.

That led Ms Foweraker to send the following email on 26 July, forwarding Ms Hudson’s request. It was addressed to Mr Fenn, with Mr Molchanoff copied. It read:

See below from Rosie regarding increase in her base salary.
Molch and I are supportive of the salary increase as Rosie is an integral part of our team.
If you could please let me know what you need me to do to be able to action this request.

The base salary increase was approved internally on 4 August by Mr Fenn, in an email to Ms Sarah Greaves, Senior HR Business Partner (Transactions), ANZ. Mr Molchanoff and Ms Foweraker were also copied in the email. It read:

Could you please help facilitate this salary increase request from Antonia for Rosie - see below.
I am happy to approve with this increase. Rosie is an important part of the team, is a proven performer with a strong track record and with fees written YTD this will not impact the bottom line.
YTD 2022 Rosie has written $210,000 in fees and will have a full year budget for 2023 of circa $700,000 that will more than cover the salary increase.
Please call me if you need additional information or have queries.

Over the next few days, formal contractual documentation was prepared by HR. It appears that the documents were drafted by Ms Kourembanas under the supervision of Ms Delia Hawke, HR Operations Advisor. On 11 August Ms Hawke emailed Ms Foweraker (copying Ms Kourembanas):

Please find the attached ESA contract for Rosie Hudson for your review.
If you are happy with the contents please issue to Rosie.
Once the letter is signed and returned we will make the changes in Workday and eWS.
Please contact me if you have any queries.

The “attached ESA contract”, in the form it took on 11 August, was not in evidence, but I infer that it was the same as the version returned by Ms Foweraker on 17 August, without the handwritten changes made by Ms Hudson (see below). That returned version took the form of a PDF document which I now describe.
The PDF document comprised 12 pages. Page 1 was in the form of a letter. Pages 2 to 12 were in the form of an agreement. Of those pages, 2 to 10 comprised the body, and 11 and 12 comprised an annexure, headed “Schedule A, The Commission Formula”. The pages of the document (except for pages 1 and 11) were consecutively paginated and contained the words “Executive Service Agreement” in the right-hand footer.
The letter on page 1 was dated 10 August and was addressed to Ms Hudson from Ms Kourembanas, who had signed it. The letter stated:

Transition to Full Time Employment
Cushman & Wakefield (Agency) NSW Pty Ltd ("Company") wish to confirm your transition to full time work arrangements effective 16th August 2022 (“Effective Date”) with continuity of service from 29th February 2016.
The terms and conditions set out in this letter and the enclosed Employment Agreement including its attachments (“Agreement”) will replace your existing employment arrangements from the 1 March 2021. You will remain in the position of Director Office Leasing, New South Wales (“Position”), based at 1 O’Connell Street, Sydney NSW 2000 and report National Director & NSW Head of Office Leasing.
Your annual remuneration will be as follows:
Base Salary ($AUD) $180,000.00
Superannuation currently at 10.5%, super cap $25,292 $18,900.00
Total Remuneration Package $198,900.00
Your Base Salary will be paid into your nominated bank account monthly. Particulars relevant to superannuation are set out below.
Please read the contents of the Agreement carefully as it sets out the terms and conditions of your employment with the Company. You can confirm your acceptance of the Agreement by initialling each page and signing in the spaces provided in the duplicate Employment Agreement and attachment and returning it to the HR Operations Team at [Email] on or prior to the Effective Date.
On behalf of the Company, we are pleased to continue working with you to achieve your aspirations and goals and those of the Company. Should you wish to clarify any details contained within this offer, or discuss any other issues please contact the HR Operations team.

The ESA began by setting out that the agreement was dated 9 August, and was between C&W, as the Company, and Ms Hudson, as the Executive. It contained 23 operative clauses and was in a similar form to the 2016 ESA and 2021 Employment Agreement. But it contained materially different terms.
Ms Hudson’s varied base salary was set out in clause 5. That clause also referred to the commission schedule, as setting out the details of her eligibility to earn commission.
Ms Hudson’s varied work hours were set out in clause 4. That clause also set out her duties, which she was to perform to the best of her ability and knowledge. She was to use all reasonable efforts to promote C&W’s interests and enhance its reputation, while acting in its best interests. She was to report to the National Director (Mr Molchanoff) and NSW Head of Office Leasing (Ms Foweraker). She was not to (absent express prior approval) undertake appointments, positions or work during her employment involving competing with C&W, adversely affecting C&W, able to give rise to a conflict, or hindering the performance of her duties.
Clause 6 obliged C&W to reimburse Ms Hudson for reasonable out-of-pocket expenses. This was conditional upon C&W being satisfied that the expenses had been incurred in the performance of Ms Hudson’s duties and in accordance with C&W’s policies.
Clause 8 gave either party a right to terminate the employment at any time and for any reason by providing 3 months’ notice. C&W could then decide to either terminate the employment immediately (and make a payment equal to Ms Hudson’s base salary for the remainder of the notice period) or to direct Ms Hudson for all or part of the notice period “not to perform any work, to remain away from its premises and/or not to contact any customers or clients of the Group” – that is, to take “garden leave”.
Clause 9, among other things, imposed an obligation on Ms Hudson to maintain the confidentiality of all Confidential Information (as defined), other than specified categories of information. By clause 10, Ms Hudson assigned to C&W various intellectual property rights.
Clause 11 concerned what was to occur after termination of employment. If Ms Hudson’s employment was terminated for any reason, C&W was entitled to set-off amounts owed by her against amounts which it owed to her (except where not permitted by law). Ms Hudson was obliged to return all C&W property on termination. This included the “return” of Confidential Information. Clause 12 (extracted below at [249]) imposed post-employment restraints.
Clause 19 was an entire agreement clause. Clause 23 provided that the agreement could be executed in any number of counterparts which, taken together, would be one instrument, and that a party could execute the agreement by executing any counterpart.
At the bottom of the numbered clauses on page 10, there was a space for Ms Kourembanas to sign, executing the agreement for and on behalf of C&W NSW, but no space for Ms Hudson to sign. Ms Kourembanas appears to have inserted an electronic version of her signature, dated 9 August.
The two-page commission schedule outlined a commission structure which was consistent with Ms Hudson’s 2021 contract, with amendments to reflect the increase in Ms Hudson’s base salary. At the bottom of the second page was space for “The Company” and “The Employee” to sign and date. Ms Kourembanas inserted what appears to be an electronic version of her signature, on behalf of C&W NSW, dated 9 August.
On 17 August, six days after Ms Hawke had forwarded the agreement to Ms Foweraker, the following exchange of emails took place between them:

Hawke to Foweraker, 17 August, 16:25
Just following up the signed ESA from Rosie please as I don’t seem to have seen it come back in yet.
Foweraker to Hawke, 17 August, 16:34
Please see attached.

The attachment sent by Ms Foweraker was the PDF document I have described above, with amendments by Ms Hudson. Those amendments were confined to the commission schedule. They appear to have been made electronically. As drafted, the table on the first page of the schedule (page 11 of the document as a whole) contained 2.5 times “multipliers”, setting out that the commission-free component of Ms Hudson’s fee pool would be 2.5 times her base salary. Ms Hudson put a line through “.5”, amending these multipliers to “2”. Lower down on the page were listed, at three points, the resulting fee threshold for Ms Hudson to earn commission, which was $497,250 (2.5 times her increased base salary). Ms Hudson put a line through those figures, and next to them inserted a text box with the figure “$397,800” (equal to 2 times her base salary).
On the second page of the schedule (page 12 of the document as a whole) Ms Hudson then placed her signature and inserted the date of 12 August in the spaces left for them. The date appears to have been inserted electronically; whether the signature was placed electronically is unclear but does not need to be resolved.
It appears that Ms Hudson’s amendments were not detected by HR until early September. In evidence was correspondence indicating that Ms Greaves of HR (who had been on leave when the contract was issued) took up the issue with Mr Fenn on 5 September. Ms Greaves noted that Ms Hudson’s amendments had not been approved by C&W. Ms Greaves also made the point that the amendments made by Ms Hudson were not binding unless countersigned by C&W.
On 9 September, Mr Fenn replied:

Fenn to Greaves (Cc: Kourembanas), 9 September, 12:22
Just to clarify the history here-
We lost our NSW head and a retention package that [included] reducing multipliers to [2] times was agreed between Tim Molchanoff, Antonia F, Jamie King and Rosie.
So in short if the others are on 2 times multipliers then so should Rosie.
Far from ideal I know but it's important we keep the team intact.

From this email, it appears that Mr Fenn may have mistakenly recalled Ms Hudson having agreed a different commission structure in December 2020, when she and others were considering leaving for CBRE. The letter in evidence showed that there was a change to Ms Hudson’s commission structure, but this was that Ms Hudson would earn commission on her fees pool above 2.5 times her base salary, not 2 times (as Mr Fenn appears to have suggested). However, Mr Fenn’s version of the history was apparently accepted by HR.
On 20 September, Ms Kourembanas emailed Ms Hudson:

Please find attached your amendment letter for your COE Contract dated on 10th August.
This amendment letter is in regards to your Commission Schedule changing from 2.5 times to 2 times your Total Remuneration.
This reflects the mark ups that were made on your returned contract, Finance require the attached letter to be signed with no mark-ups to process.

The attachment took the form of a letter which was dated 20 September. It began:

Addendum to Change of Employment Letter
Cushman & Wakefield wish to confirm the below serves as an addendum to your Change of Employment letter dated 10th August 2022.

The letter then set out the text of the August commission schedule, revised to include the amendments which Ms Hudson had made to that schedule. It was signed on the second page by Ms Kourembaras. Ms Hudson signed and inserted the date of 20 September in the places indicated at the foot of the page and emailed the signed version back at 1:55 pm. This was apparently accepted by HR and there was no further communication between the parties concerning employment terms.
Witness evidence: In her first affidavit, of 9 March this year, Ms Hudson gave the following evidence about the circumstances in which she signed the August 2022 ESA:

On 10 August 2022, I was issued with my most recent employment agreement with the Plaintiff, a copy of which is exhibited … . Clauses 12.2 and 12.3 of that agreement were different to the prior agreements, in that the restraint was now sought for twelve months. This was not made known to me by any staff of the Plaintiff and I was not otherwise aware of it. I remember that Antonia sent the letter and agreement to me via email, and there were several attachments. There was a separate attachment entitled "Schedule A The Commission Formula". Certain parts of that formula were highlighted and flagged for my attention. That is the only document I signed, electronically, and returned. I did not read the "Agreement" document nor sign or initial as I usually would have, because I thought from all of my discussions and our email correspondence that was not necessary because no other terms were changing. I did not turn my mind to this at the time because I trusted everyone involved and I had previously advised the Plaintiff I would not be signing off on such extensions during the signing of my prior agreement, so thought that issue was resolved. I had no reason to believe or understand that there was an intention on the part of the Plaintiff to change the terms of the restraint or notice period in my contract from the terms in my previous contracts. Had I known at the time that the contract purported to extend the notice period and restraint, I would have again objected and made hand-written amendments as I had done with the prior agreement. It was a difficult time in my life, as our second daughter had just been born in January, and I was a bit overwhelmed organising care for our girls while adjusting following the birth and organising my return to work full-time.

Ms Hudson’s claimed belief that no terms of her ESA were changing except for the commission schedule was the subject of debate at the interlocutory hearing before Richmond J. In his judgment his Honour stated (J1 [7]-[8], emphasis added):

There were a number of differences between the terms of the Contract [the August 2022 ESA] and [Ms Hudson’s] prior contract. First, under cl 8.1 the period of notice of termination was extended from 1 month to 3 months. Second, cl 12.1 extended the period of the post-contract restraint from 1 month to periods from 3 to 12 months. Third, the term of her remuneration, both as to base salary and commission, were improved.
The defendant gave evidence, which was not contested on this interlocutory application, that the first two changes were not made known to her by the plaintiff before she signed the document (beyond the fact that she received by email the letter attaching the Contract for signature referred to at [4(h)]), and that she did not read any part of the Contract apart from the 2 page Schedule A appearing at the end of the document, on which her signature appeared. She thought from all of her discussions and email correspondence that it was not necessary for her to read the document because no other terms were changing. However, the [defendant] does not give evidence that any representatives of the plaintiff said to her that none of the terms of her employment contract were changing apart from her salary and commission in Schedule A and there is no email correspondence in evidence which could be relied on for that purpose.

Following delivery of the judgment Ms Hudson stated in her affidavit of 31 March (emphasis added):

In relation to the 2022 Contract, I now recall Antonia phoned me when the salary increase requested was approved, and said to me words to the effect of 'Rosie, your salary increase got approved! I chatted with Molch and there won't be any other contract changes and he said he sorted that in your last contract, so we'll get that sorted with HR.' I think that was on 9 August 2022.
When I received the new contract, from memory the next day, I was not in the office but was at home minding my daughters. Antonia phoned me again and said words to the effect of 'Rose, your employment contract just came through. There's three parts to it. Just sign the commission schedule part as that's changed but other contract terms [are] staying the same so ignore the rest'. I did not read the bulky agreement document for this reason nor sign it. I was never followed-up about this by HR or Molchanoff or anyone else, and Molchanoff did not warn me as he had in the past. My pay was never withheld as it had been previously.

Ms Foweraker gave the following evidence in an affidavit of the same date:

[16] Rosie returned to full-time work in August 2022. She emailed me on 25 July 2022 asking for an increase to her base salary. …. I agreed with this purely because of her skill and the amount of revenue she had derived for the company. It was not reflective of anything else. She did not bring on any new clients or win any business, and it was simply a result of hard work and effort. I discussed Rosie's email with Molchanoff that day, in words to the following effect:
[Foweraker]: 'Molch, Rosie is asking for a pay rise to $180K inclusive of super. She wants to come back to work full-time but she'll have increased day care and nanny costs and stuff. She wrote $2.4 million in business last year and she's always been a top performer. We definitely want her back and I think she's worth it.'
Molchanoff: 'Yeah I agree. We definitely want her back. Let's give it to her.'
[Foweraker]: 'Alright so I'll get HR to issue a new contract with increased pay and up the four days to five. No other changes as per usual?'
Molchanoff: 'Yep fine.'
[17] Following this, … I then commenced the process of having Rosie's new contract arranged internally. Exhibited … is a copy of a internal email thread for that purpose ending on 10 August 2022, including Simon Fenn, which followed up on my conversation with him. There is no mention of any other change to Rosie's contract or employment terms, and especially not any post-employment restraint or increase. I never instructed anyone to increase Rosie's post-employment restraint or notice period, and was never informed by anyone that it would be or even asked about it. It was never my intention to increase the length of the restraint or notice period, and had I known a contract had been issued to Rosie along those lines, I would have objected and sought amendments to it. I assumed that issue had been resolved previously when Rosie corrected the prior increase to her 2020 contract, but unfortunately I did not read this contract because of that and because I trusted Molchanoff and my discussion with him (which I referred to in paragraph 16 above), and trusted that the human resources team would not make any further amendments of their own accord given my instructions.
[18] … I received it [the new contract] in three documents, being a cover letter, an "agreement" document and a separate document called "Schedule A The Commission Formula". I recall discussing this with Rosie on or about 12 August 2022 and saying to her words to the effect of 'Just sign the commission formula as there are some changes highlighted in there, but I've sorted this with Molch already and your other contract terms won't be changing. It's the same as the letters we got when we got that "stay-on bonus" when CBRE approached us in 2020’.

In an affidavit in reply, Mr Molchanoff denied having had conversations with Ms Foweraker in the terms outlined by her. He recalled discussing Ms Hudson’s pay increase request with Ms Foweraker and that he had supported approving that request. He gave evidence that he did not discuss with Ms Foweraker whether any of Ms Hudson’s other employment terms would change, and that they had not discussed other terms more generally.
In cross-examination, Mr Molchanoff was asked if he, at the time the 2022 contract was being discussed, went to HR, or anyone in management, to tell them to ensure the restraints remained unchanged. He did not recall any conversations to that effect.
Among the topics on which Ms Hudson was cross-examined was what was issued, signed, and returned in August 2022. She acknowledged having received the body of the August 2022 ESA but maintained that she did not read it. The cross-examination continued:

Q. Can I clarify this with you Ms Hudson. You say that the email that was sent to you contained three separate attachments; is that right?
A. Yes.
Q. But the reality is, it only contained one attachment; correct?
A. It's three parts of attachment.
Q. The email that was sent to you had one attachment; correct?
A. I don't recall.
Q. You don't remember?
A. No.
…
[Counsel then referred Ms Hudson to the pagination of the PDF document]
…
Q. There was only one attachment?
A. Yes.
Q. You signed the last page of that attachment; correct?
A. I signed the page which was advised by me by my manager at the time, to review the commission schedule--
Q. Can you answer the question?
A. --which was attached.
Q. Could you please answer the question, Ms Hudson. You signed the last page of that attachment?
A. Yes.

Ms Hudson was then asked about the 20 September letter. She recalled an issue having been raised with her about the changes she made to the commission structure. She was taken to the letter and recalled receiving it . She was asked, “[y]ou can see that the letter started, "Cushman & Wakefield wish to confirm the below service", as an addendum to your change of employment letter dated 10 August 2022” and answered, “yes”.
Ms Hudson was asked if she had “read this document carefully”. The following was said:

A. I read this document because the only change that I requested was on - sorry.
HIS HONOUR: Please answer the question and if you can answer it yes or no, please answer it yes or no.
A. Yes, I read this email that was sent to me.
No, the question was about the document that is the attachment.
WITNESS: Yes, I read the document.
MAHENDRA
Q. And you read the document carefully?
A. Yes.
Q. You understood that what the document was doing, was amending your contract confirming the change that had been made to your commission structure; correct?
A. Yes.

Ms Foweraker, when cross-examined, confirmed that she had received an employment contract from HR, and had then sent it to Ms Hudson. She recalled there having been some issue around 17 August, where HR had not received a signed employment contract from Ms Hudson. Ms Foweraker was taken to the email she sent to Ms Hawke on that date. She confirmed that she had received a signed document from Ms Hudson. She was then asked whether it was one document she received from Ms Hudson. The cross-examination continued:

A. I don't recall.
Q. Do you recall sending [the email of 17 August, see [108] above] to Ms Delia Hawke?
A. Yes.
Q. And you attached one document; correct?
A. I don't remember recall how many documents were attached.
Q. We can see from your email, where it says attachments, you accept, don't you, there's only one attachment there?
A. Yes, it would appear so.
Q. If we then go to page 292, do your recall seeing the changes that Ms Hudson had made to her contract?
A. No, I don't recall, but I do remember discussing it.

Counsel returned to that topic after an adjournment. Ms Foweraker confirmed that when earlier asked if Ms Hudson’s employment contract was sent to her as one document, she had answered that she did not remember. Counsel took Ms Foweraker to [18] of her March affidavit, and her statement that she “received it in three documents, being a cover letter, an "agreement" document and a separate document called “Schedule A The Commission Formula”. Ms Foweraker denied that this statement was incorrect. The cross-examination continued:

Q. A moment ago when I asked you whether it was sent to you as one attachment--
A. I said I don't recall.
Q. You don't recall?
A. Yes.
Q. So when you describe three documents are you saying it's one attachment with three documents or are you indicating that there are three separate attachments?
A. Three documents.
HIS HONOUR: Three attachments or three documents?
WITNESS: Three documents.
MAHENDRA
Q. In one attachment?
A. Yes.

Ms Foweraker was also asked in the course of her cross-examination about the September commission schedule signed by Ms Hudson. She did not remember having had any involvement.
Counsel also took Ms Hudson to her evidence of the conversations in her 31 March affidavit. Counsel drew Ms Hudson’s attention to the word “now”, in the sentence, “[i]n relation to the 2022 contract, I now recall Antonia”. Ms Hudson denied that this was a conversation she had forgotten in her previous affidavits but acknowledged that she had not included it. Counsel put it to Ms Hudson that it was possible that she had this conversation with Ms Foweraker in relation to the 20 September addendum. Ms Hudson denied this.
Having confirmed that Ms Hudson did not include evidence of the conversations in her first two affidavits, counsel put it to her that she included that evidence to address what Richmond J had said in his Honour’s March judgment (at J1 [8]). Ms Hudson denied that. As with the conversations with Mr Molchanoff, Ms Hudson acknowledged that she could have mentioned the conversations in her February correspondence but had not.
Counsel took Ms Foweraker to her evidence of a conversation (see above at [120]) she had with Ms Hudson in August. Counsel put it to her that she had made up the conversation and that it did not occur in those terms. Ms Foweraker denied both of these suggestions.
Factual issues and conclusions: Although Ms Hudson and Ms Foweraker agreed that Ms Foweraker forwarded to Ms Hudson the contractual documentation received from Ms Kouremabaras, and Ms Hudson returned the documentation in amended and signed form, there was no record of this in the evidence. This is surprising, as both parties would usually have had copies of such emails.
A possible explanation for the absence of evidence is that Ms Hudson in fact received the documentation in hard copy form after she returned to work, but the question was not explored in cross-examination. I proceed on the basis that the documentation was sent to Ms Hudson, signed on 12 August, and sent back, while she was at home even though there is no evidence of precisely when the relevant emails passed between Ms Foweraker and Ms Hudson or what those emails said.
The first question to be addressed is what Ms Hudson was issued with, signed and returned in August 2022. The question arose because of Ms Hudson and Ms Foweraker’s affidavit evidence. Ms Hudson stated that Ms Foweraker had sent her the 2022 contract by way of multiple attachments, and that she had only signed and returned a two-page PDF headed “Schedule A The Commission Formula”. Ms Foweraker also gave evidence about having received the 2022 contract from Human Resources in three documents – a cover letter, the agreement document and the commission schedule.
Despite the cross-examination which I have set out above, counsel for Ms Hudson appeared to maintain this line in closing submissions. Counsel maintained in writing that “[w]hat was returned was an electronically signed Schedule A styled “The Commission Formula” dated 12 August 2022”. Orally, counsel added that Ms Hudson was not challenged on her evidence that the only document she signed and returned was the commission schedule. Counsel also submitted that although Ms Foweraker returned a single PDF attachment, that did not necessarily mean that the PDF was not set up into several attachments.
I do not accept these submissions. The email from Ms Foweraker to Ms Hawke returning the signed contract was in evidence, and had an attachment consisting of a single PDF document. These is no reason to think that the attachment issued by Ms Kourembanas on 10 August was any different. Contrary to counsel’s submission, this was put to Ms Hudson in cross-examination and accepted by her. Ms Foweraker also accepted it in cross-examination. I find accordingly.
Next, I turn to whether Ms Hudson’s and Ms Foweraker’s accounts of the conversations about the August 2022 contract documentation should be accepted. In particular, the question is whether Mr Molchanoff gave an assurance to Ms Foweraker that the terms of Ms Hudson’s employment contract were not otherwise being changed, and Ms Foweraker passed that on to Ms Hudson.
It is convenient to begin with the conversation which Ms Foweraker said she had with Mr Molchanoff on 25 July (quoted at [120] above). I think it is inherently implausible that Mr Molchanoff would have agreed that there would be “no other changes, as per usual” to Ms Hudson’s employment terms. First, on 25 July the increase in Ms Hudson’s salary still had to be approved by Mr Fenn, and the question of varying or not varying her other terms of employment would only arise once that happened. Furthermore, if it did happen, Mr Molchanoff would not be responsible for settling those terms. Rather, both parties to the conversation would have expected (as occurred in due course) that the documentation in question would be drawn up by HR. Neither of them could have known whether HR would propose the issue of a fresh set of contractual terms, let alone what form such terms would take. Nor is there any reason to think that there was some sort of “usual” practice in this regard. In fact, the evidence shows that the employment terms in the 2021 contract differed from the 2016 contact. This is exactly what one would expect where contractual documentation was administered centrally using (presumably) a standard form precedent.
Ms Foweraker’s account of her conversation with Ms Hudson when she forwarded the contractual documentation to her on 11 or 12 August (quoted at [120] above) gives rise to further difficulties. In the first place, it is strange, when it was Ms Foweraker who had been asked by HR to review the documentation, for her to attribute her failure to read it to her “trust” in Mr Molchanoff, who, so far as the evidence goes, was not then involved in the process at all. Furthermore, the statement Ms Foweraker attributes to herself – that the documentation was “the same” as the 2020 stay-on bonus documentation – was incorrect. No fresh contract had been issued in 2020.
There are also difficulties with Ms Hudson’s version of events (set out above). In the first place, her evidence that she received three separate documents, as already noted, was incorrect in fact. Furthermore, on her account, Ms Foweraker reported that her employment terms were not changing because they had been “sorted” with Mr Molchanoff in 2021. But that was not supported by Ms Foweraker, who attributed the absence of change to some sort of “usual” practice and said she mentioned the 2020 amendments, not the 2021 contract.
Against this background, and the doubts I have about the reliability of Ms Hudson’s and Ms Foweraker’s evidence generally, I do not accept that Mr Molchanoff gave the assurance to Ms Foweraker that Ms Hudson’s contract terms would not change, or that Ms Foweraker passed any such assurance on to Ms Hudson. As with the alleged representations by Mr Molchanoff in 2021, the alleged assurances are too good to be reliable, especially when they first emerged after the deficiencies in Ms Hudson’s case had been pointed out by Richmond J.
Finally, I make a further comment on the factual basis to Ms Hudson’s misleading and deceptive conduct claim. I have already found that the representations attributed to Mr Molchanoff in 2021 have not been established. Even if they had been established, it hardly seems likely that, in deciding how much of the August 2022 contractual documentation she needed to read, Ms Hudson would have cast her mind back to the negotiations which had taken place on a separate issue in early 2021. She did not claim in her affidavit to have done so. I am not satisfied that as a matter of fact that Ms Hudson relied on any such representations in negotiating the 2022 contract.

Customer connection

It was not in dispute that personal relationships with landlords and tenants were a key part of Ms Hudson’s role. Ms Hudson herself accepted that her commission structure meant she had a financial incentive to invest in those relationships. She also accepted that those relationships enabled her to gain an intimate knowledge of client leasing needs.
The evidence showed that Ms Hudson was required to meet with existing clients regularly. She was also encouraged to meet with others where building relationships could be of benefit to C&W. All of these meetings occurred at the expense of C&W, who would reimburse Ms Hudson. In their evidence, Ms Hudson, Ms Foweraker and Mr King emphasised limitations in Ms Hudson’s role, relative to more senior employees. But they did not detract from the foregoing observations.
Also in evidence were examples of marketing material holding Ms Hudson out as a key contact for C&W’s leasing activities on two buildings. On each building she was listed alongside another C&W representative, and on another the contact details of two CBRE representatives were also listed (that was a co-appointment with CBRE).
Much of the evidence on this topic was concerned with particular appointments held by Ms Hudson at the time of her resignation, and individual entries on an expense report in the months leading up to her resignation (and following her return to full-time work). Four appointments were focused on, which had been identified by Mr Molchanoff in his 31 March affidavit. In cross-examination, Mr Molchanoff accepted that these were the four appointments that C&W held concerns about. In re-examination, Mr Molchanoff clarified that these were the significant appointments that Ms Hudson was involved in, and the key ones that C&W were concerned about.
These were all appointments that Ms Hudson held at the time she entered the 2022 contract. Ms Hudson had been replaced on each of those appointments while on maternity leave. She had been working on one or two other appointments, as well.
Mr Molchanoff was cross-examined on the four appointments. He accepted that one of those, a co-appointment, with Colliers, is no longer with C&W, because the landlord decided to slim down and just go with Colliers. On the other three, Mr Molchanoff conceded that C&W had moved employees on to these following Ms Hudson’s departure, and each now had an employee who had prior experience on the corresponding appointment while Ms Hudson had been on maternity leave.
When challenged in cross-examination about his concerns about one of these appointments, Mr Molchanoff maintained that there was pressure to keep it after Ms Hudson and Ms Foweraker’s departure (where both were appointed on the relevant building). Counsel put it to him that it would actually take time to re-establish Ms Foweraker’s connections. In response, Mr Molchanoff maintained that it was not solely dependent on one person but on the team assigned to the appointment.
Mr Molchanoff also gave evidence about the length of time it would take to replace Ms Hudson. In his first affidavit, he affirmed that that because of the nature of Ms Hudson’s role, and in particular the deep relationships she developed with the clients that she represented, he considered:

It could take up to twelve months (or even longer) in order to:
(a) find an adequate replacement to fulfil Ms Hudson’s role, including the time taken to negotiate an employment agreement with that person; and
(b) take the necessary steps to have that replacement develop a relationship with the clients formerly represented by Ms Hudson similar to the depth of relationship which Ms Hudson had with those clients.

Mr Molchanoff reiterated this evidence in a later affidavit. He added that, on the first step, based on his market experience, there were not many people with Ms Hudson’s experience and expertise. On the second step, he added that, based on his experience, there was a significant time lag in developing the relationships he had mentioned.

In cross-examination, Mr Molchanoff explained that his estimate was informed by matters of timing. He explained that typically people are more likely to move early in a calendar year – the applicable financial year, for commission purposes, for most agencies – so they can get the benefit of commission from the previous year.
Confidential information: A considerable amount of evidence was directed to evidence of confidential information that Ms Hudson came into contact with. Nonetheless, a lot of this was at a high level of generality. As will be seen, I did not base my conclusions on confidential information. I concluded that C&W had a protectable interest based on customer connection. I did not consider that confidential information would support longer restraints as being reasonably necessary. In those circumstances, I do not propose to summarise the evidence on confidential information further.

Second, counsel submitted that Ms Hudson’s customer connection was affected by her status as a more junior employee, and the interruptions caused by substantial periods of maternity leave, COVID lockdowns and part-time work.
Third, counsel referred to Ms Hudson’s position under the 2021 contract, and the circumstances in which she negotiated the 2022 contract, to demonstrate that the increased restraint went beyond what was reasonable. Counsel emphasised that there was no change to Ms Hudson’s position, that she remained subject to the retention payment terms, that she was under the same supervisors, that the increase in her base salary was explained by the cost of childcare, and the transition was simply from part-time to full-time work.
Both parties paid lip service to the principle that reasonableness is to be determined as at the date the relevant contract is made, and accordingly evidence of subsequent events is irrelevant to reasonableness, although it may be relevant to the discretionary refusal of relief. But the witness evidence and submissions presented tended to blur this distinction. Of course, less than a year elapsed between the making of the 2022 contract and the date of the hearing, and it seems that there was no relevant change in market conditions, or the nature of C&W’s business, over that period. Whatever the explanation for the parties’ approach may have been, I have proceeded on that general assumption.
I begin with the non-solicitation restraint. The evidence showed (and I do not think it was really disputed) that customer connections were central to Ms Hudson’s role. This was so, notwithstanding the fact that Ms Hudson often did not have the sole connection with customers. The non-solicitation restraint directly protected C&W’s interest in those connections. It was also directed to the relationships that would have been at their strongest when Ms Hudson was to leave – those with customers of C&W with whom Ms Hudson had worked or had dealings in the prior twelve months.
A substantial amount of the evidence on customer connection was concerned with Ms Hudson’s appointments immediately prior to her resignation, which she also held at the time she entered the 2022 contract. There was evidence that other C&W employees had been involved on those appointments, including during Ms Hudson’s periods of parental leave. I accept that this would make it easier for C&W to re-build relationships.
As appears from the summary above, there was not a great deal of objective evidence as to how long it would take C&W to hire a replacement for Ms Hudson and introduce that replacement to the customers with whom Ms Hudson had had contact. But I do not think that this is the only question. C&W’s protectable interest, in the case of a customer-facing role, also extends to severing the personal connection built up by the employee, at C&W’s expense, with customers or potential customers. Of its nature, this is unlikely to be capable of being precisely quantified by evidence. It must involve a substantial degree of common sense and judgment (a point made by the authorities referred to earlier).
I also think that caution must be applied in referring to the restraint periods in Ms Foweraker’s and Mr King’s employment contracts. It needs to be borne in mind that when the 2022 contract was made, the parties did not know that Ms Foweraker and Mr King would leave for JLL at the same time as Ms Hudson. Furthermore, there might be many reasons, including mistake or inadvertence, for those periods. The Court should not allow an issue as to the reasonableness of the restraints in Ms Hudson’s employment contract, entered into on a specific date, to turn into a general inquiry into the terms on which, at other times, other employees’ employment contracts were entered into, and why. That is not to deny that evidence of an “industry standard” may be relevant in determining the reasonableness of restraint terms (see, for example, Koops Martin at [56]). But there was no evidence of that kind in the present case.
The 2022 contract did contain a formal acknowledgement that the restraint periods in that contract were reasonable, but counsel submitted that Ms Hudson was unaware of those restraint periods at the time. However, there can be no doubt that Ms Hudson freely and knowingly agreed to a six-month post-termination non-solicitation restraint in her contract with JLL (see also Tullett Prebon at [53]).
Strictly speaking, this was evidence post-dating the 2022 contract. But this point was not taken by counsel for Ms Hudson. Perhaps this was because negotiations with JLL had already commenced by the time the 2022 contract was entered into. On any view, it tends to call into question the claim that Ms Hudson would not have agreed to the restraint periods in the 2022 contract if she had been conscious of them, and that as a result the acknowledgement in that contract is to be discounted.
Ms Hudson was, on her own account, writing more than $800,000 per year in business, including having written $2.4 million in 2021. She was earning (when commission was taken into account) hundreds of thousands of dollars a year. I do not think it is realistic to characterise her as a junior employee, if that is meant to suggest that her customer connections were of little value to C&W.
In the circumstances of the case, I concluded that a post-termination non-solicitation period was reasonable, but not for the whole period sought by C&W. In the exercise of my judgment, I fixed the period at six months. Furthermore, C&W sought a restraint which would extend to suppliers, in accordance with the terms of the restraint. But there was no evidence that Ms Hudson had any role in dealing with suppliers of goods and services to C&W’s business, let alone that she could have been expected to develop some sort of supplier connection. I therefore limited the injunction to solicitation of C&W customers (see below).
I now turn to the competition restraint. Again, this had to be justified in terms of protecting C&W’s interests in its customer connections. The case for a non-competition restraint was weaker, particularly where non-solicitation restraints would also be in force. Nevertheless, it is accepted that a general competition restraint may be justified, especially for a customer-facing employee. The comments by Brereton J in Koops Martin (at [44]) are in point (my emphasis, citations omitted):

A more robust view is taken where the employee’s role includes obtaining and extending custom for the employer’s business. When an employee’s duty includes to build up the employer’s clientele as well as to deal with existing clients, a wide restraint is more likely to be upheld, because in such circumstances the employer is entitled to protection against the employee taking advantage of the period of service to prepare for later competition. In such a case, the establishment of a customer connection is not merely incidental to the employment, but its purpose. In that context, a covenant is considered reasonable, first, to remove the temptation that by cultivation of the target market during employment, the employee may prepare the ground for its exploitation by himself after the employment ends, rather than for his employer during the employment; and, secondly, to prevent exploitation after termination of the employment by the employee of a connection with the customer which the employer has paid the employee to establish for the employer’s benefit.

It must again be emphasised that the question is not whether Ms Hudson in fact engaged in unfair competition of the type mentioned by his Honour, but whether it was reasonable for C&W to take a non-competition covenant to protect itself against the risk of her doing so. I considered that, in the circumstances of the case, a post-termination restraint was reasonable, but for a lesser period than the non-solicitation restraint. In the exercise of my judgment, I fixed the period at three months.
Again, I also limited the scope of the injunction. C&W had sought an injunction applying to any involvement with JLL. I limited the injunction to performing leasing agency services work relating to commercial property in the Sydney CBD. This was designed to enable Ms Hudson to work with JLL (or any other commercial leasing agency service firm) in other markets, or on tasks which did not involve the provision of commercial leasing agency services (for example, a purely administrative role).
The scope of the garden leave injunctions was similarly limited, except that they applied to leasing services relating to commercial property in New South Wales rather than commercial property in the Sydney CBD. I considered that a more extensive restriction was justified in the garden leave period.

Refusal of injunctive relief

Counsel for Ms Hudson also contended that there were several discretionary reasons why the Court should not exercise its discretion to enforce any restraints beyond the conceded ten-week period. Counsel for C&W took the preliminary point that no discretionary matters had been pleaded. Counsel agitated this issue on the first day of the hearing, when counsel for Ms Hudson indicated that discretionary matters were relied on. Counsel maintained this position in closing submissions, noting that no amendment had been made to the pleadings, despite the issue being raised at the start of the hearing. Counsel for Ms Hudson responded that it was not necessary to plead such matters reasons, as they are submissions to be advanced in the context of the Court tailoring its relief.
Before dealing with the specific points made by the parties, it is necessary to say something about the grounds upon which injunctive relief may be refused in restraint of trade cases. There are differences, or potential differences, of doctrine between the grounds, including as to the party which bears the onus.
The starting point is that we are talking about refusal of equitable relief. If a restraint is unreasonable, then it is void and unenforceable at law. Equity follows the law and hence such a restraint cannot be enforced in equity. The present discussion concerns cases where the restraint is valid at law, but equitable relief may be refused, leaving plaintiffs entitled to pursue their rights at law, including damages. I think such cases fall into at least three different classes.
The first class covers cases where the plaintiff fails to establish the elements which apply to the grant of injunctive relief generally. Because this is part of the plaintiff’s case, the onus lies on the plaintiff. An example is the requirement that the plaintiff establish that there is a real risk of conduct by the defendant which would breach the restraint. My refusal of C&W’s claim for injunctions against interfering with its business or soliciting its staff in the present case is an instance. Another example is the requirement that damages be an inadequate remedy, discussed below.
The second class covers recognised equitable defences, such as unclean hands, hardship and laches. These are defences which are generally available wherever equitable relief is sought (although their application may differ between different types of case). As with all affirmative defences, the onus of establishing them lies on the defendant.
The third class of case is different again. It has frequently been said that while the reasonableness of a restraint depends on the circumstances at the time it was granted, the court may look to the circumstances as at the date of the trial in deciding whether to refuse relief: Isaac at [63]. The assumption is that the court has a discretion to refuse injunctive relief where events which have occurred since the restraint was granted would make its enforcement unreasonable.
A clear case calling for the application of this principle is where a plaintiff who at the time of obtaining a restraint had a legitimate interest in enforcing that restraint has lost that interest (for instance, in the case of a vendor restraint accompanying the purchase of the business, where the purchaser has sold the business by the time enforcement was sought). But the boundaries of the principle have not been mapped out. Clearly it is distinct from hardship. It only seems to have been recognised in restraint of trade cases. Presumably, it applies only to injunctive relief, meaning that the restraint, which ex hypothesi satisfies the common law test of validity, can still be enforced by way of action for damages.
It is unnecessary to explore these potential issues further in the present case. The principle has been recognised at Court of Appeal level. Neither party challenged its existence nor debated its scope beyond appeals to “reasonableness”. I will proceed in the same way.
Counsel for Ms Hudson, in written submissions, identified nine separate discretionary reasons for refusing relief. There was some overlap, and I thought some of the grounds were not relevant or were really matters going to reasonableness. I have distilled the remaining points as best I can and deal with them under the classes I have just identified.
First Class: Counsel for Ms Hudson put in issue whether damages were an adequate remedy. Usually, it is necessary before equitable relief can be granted that relief at law (damages) would not be an adequate remedy. There is however a debate about whether, as a matter of principle, this requirement applies when the plaintiff seeks an injunction to restrain the breach of a negative covenant: see Meagher, Gummow & Lehane’s Equity Doctrines & Remedies Heydon JD, Leeming MJ and Turner PG, (5^th ed, 2015, LexisNexis Butterworths) at [21-195].
It is unnecessary to consider the question in any detail for the purposes of this judgment. It was discussed by Brereton J in Otis Elevator Company Pty Ltd v Nolan [2007] NSWSC 593, which counsel for Ms Hudson referred to. It seems then that the relevant principles are not in dispute. Otis was a restraint of trade case. At [17] Brereton J observed:

The remaining and crucial question, therefore, pertains to the Court’s discretion to grant or withhold injunctive relief. All equitable relief is discretionary. That is so even of an injunction to restrain a breach of a negative contractual stipulation, although discretion to decline relief is rarely exercised in that context. Nonetheless … that discretion exists, and the grant of an injunction on a final basis, even in such a case, remains ultimately discretionary.

Orally, counsel for Ms Hudson advanced this matter by reference to the $175,000 retention payment, which Ms Hudson was willing to repay, and sought to characterise it as a form of liquidated damages. I agree that the retention payment offered a degree of protection against the prospect of Ms Hudson leaving, at least during the time where she would need to make a re-payment.
I do not think that means that damages are an appropriate remedy in this case. I think that the reasons of Brereton J in Tullett Prebon at [98]-[103] are consistent with this. His Honour considered that even a liquidated damages clause in a contract, although it would arguably mitigate the difficulty of calculating damages, did “not make it any more just … to escape from … contractual obligations at the price of paying damages”. This was because “[e]quity holds parties to their agreements, rather than allowing them to escape from them at the price of damages” (at [102]). That reasoning is all the more apposite in the present case where the contract contained an express acknowledgement that “damages are not an adequate remedy for any breach of the restrictions”.
Second Class: Counsel for Ms Hudson advanced three recognisable equitable defences: delay (laches), unclean hands and hardship. As I have explained, the onus of establishing such defences rests with the defendant. In my view, that means the defendant must plead them. Insisting on that avoids prejudice to the plaintiff, in circumstances where the pleading may point to some fact that does not necessary arise out of the plaintiff’s case in chief.
In circumstances where none of these defences were pleaded, and the plaintiff objected to this course, I do not propose to entertain these defences. But I was not persuaded by any of these defences on their merits either.
On delay, counsel for Ms Hudson submitted that C&W was slow to approach the Court for interlocutory relief, having done so on 7 March. In the circumstances, however, that delay was not disqualifying. Ms Hudson remained in correspondence with C&W HR until 22 February. In evidence was correspondence from C&W’s solicitors to Ms Hudson dated 27 February. I do not think it was unreasonable to delay the commencement of litigation until after the negotiations ran out. The proceedings were commenced less than two weeks later. Richmond J thought that there was not “any material delay” (J1 at [38]), and I see no reason to take a different view, especially at this stage of the proceedings.
Counsel for Ms Hudson’s submissions based on unclean hands relied on non-compliance with the award or the Fair Work Act. As I have found that there was no such non-compliance, the argument fails.
Counsel’s submissions based on hardship do not alter the position either. First, there was no evidence in the present case that JLL was in fact going to withdraw Ms Hudson’s offer of employment, including requiring re-payment of the $1.3 million lump-sum. Such evidence ought to have been adduced, given that Ms Hudson bore the onus of proving hardship. Second, I took care in formulating the injunctions to allow Ms Hudson to work for JLL in the post-employment period, so long as she did not do so in a way involving solicitation or direct competition by her in the market, as specified. Third, I agree with counsel for C&W that any hardship was self-inflicted, as Ms Hudson voluntarily accepted the offer from JLL and persisted, despite being aware that C&W was contending that the August 2022 contract, with its extended restraint periods, applied.
Third Class: Counsel for Ms Hudson also raised matters invoking circumstances as at the date of hearing, and appeared to suggest that these would render enforcement of the restraints unreasonable. Counsel emphasised the absence of evidence of hardship having flowed to C&W from the departure of Ms Foweraker and Mr King – more senior employees who left at the same time to JLL – despite the proceedings having been commenced five weeks after their departure. Counsel submitted that there was economic downturn, that Mr Molchanoff had referred to that, and submitted that C&W did not expect to be writing the same business.
My inclination is that matters of this kind should be pleaded as well. Nonetheless, I was not persuaded by them on the merits.
In my view, it is not to the point that there may, at the moment, be a lack of evidence of hardship or damage to C&W. The purpose of injunctive relief is to protect against the risk of harm. C&W’s interest in protecting its customer connections remained as valid at the date of the hearing as it was when the 2022 contract was entered into. I also think that the terms of Ms Hudson’s agreement with JLL may legitimately be taken into account on this point.

Conclusions and orders

I announced the following conclusions on 28 April 2023.

Three months’ notice period and (and associated gardening leave provisions) and the twelve-month post-employment restraint period were validly incorporated into Ms Hudson’s employment contract by September 2022 at the latest;

Ms Hudson’s claim for rectification of the contract in that form fails;

So too does Ms Hudson’s claim for relief under s 237 of the Australian Consumer Law;

So too does Ms Hudson’s contention that the contract was terminated by C&W before the expiry of the gardening leave period;

The restraint imposed on Ms Hudson for the period of her gardening leave (that is, up until the expiry of the employment contract on 3 May 2023) are valid and enforceable to the extent that they prevent Ms Hudson from dealing with clients and customers of C&W [with whom she had contact] and being employed in any business competing with C&W within the Sydney CBD commercial leasing agency market, and the post-employment restraints are enforceable in the case of the non-solicitation restraint, for a period of six months from the termination of Ms Hudson’s employment contract (i.e to 3 November 2023) and in the case of the competition restraint for a period of three months from the expiry of Ms Hudson’s employment contract (i.e, 3 August 2023);

There is no sufficient reason to refuse injunctive relief to that extent.

The orders made on 28 April 2023 were:

Order that the Defendant be restrained, for the period until 3 May 2023, from:

having any dealings with any customers or clients of the Plaintiff or of any of its related bodies corporate, as that term is defined in the Corporations Act 2001 (Cth), concerning the leasing or proposed leasing of any commercial property in New South Wales; and

performing (whether as employee, agent, contractor, director or otherwise) any leasing agency services work relating to commercial property in New South Wales, otherwise than for the Plaintiff or any of its related bodies corporate.

Order that the Defendant be restrained, for the period from 3 May 2023 until 3 November 2023, from soliciting, canvassing, approaching or accepting any approach from any person or entity who was at any time during the period from 6 February 2022 to 6 February 2023, a customer of the Plaintiff or any of its related bodies corporate with whom the Defendant worked or had dealings, with a view to establishing a relationship with or obtaining the custom of that person or entity in a business in any way relating to the provision of commercial office leasing agency services.

Order that the Defendant be restrained, for the period from 3 May 2023 until 3 August 2023, from performing (whether as employee, agent, contractor, director or otherwise) any leasing agency services work relating to commercial property in the Sydney Central Business District, otherwise than for the Plaintiff or any of its related bodies corporate.

Otherwise discharge order 5 made by the Court on 7 March 2023.

Reserve costs.

Order the operation of Orders 1 to 5 be stayed until 6pm on Monday 1 May 2023.

Adjourn the proceedings for further directions to 4pm on Monday 1 May 2023.

**********

Decision last updated: 28 July 2023

Medium Neutral Citation:	Cushman & Wakefield Agency (NSW) Pty Ltd v Hudson (No 2) [2023] NSWSC 884
Hearing dates:	17, 18,19, 21 April 2023; supplementary written submissions ending 24 April 2023
Date of orders:	28 April 2023
Decision date:	28 July 2023
Jurisdiction:	Equity - Expedition List
Before:	Parker J
Decision:	See [317]-[318]
Catchwords:	COMMERCE – Restraint of trade – validity and reasonableness – length and scope of restraint – where garden leave and post-employment restraints protecting customer connection – where employee in Sydney CBD market for office leasing – scope and duration of restraints limited – whether discretionary grounds made out CONTRACTS – formation – intention to create legal relations – whether signature evidence of assent to entire document or qualified – where contract sent as one PDF attachment – where employee signed one space asking for signature – objective intention to be bound by entire contract EMPLOYMENT AND INDUSTRIAL LAW – contract – terms – whether restraint and notice provisions vitiated by misleading and deceptive conduct – prior conversations relied on as representations – whether representations proven – representations not proven – whether restraint and notice provisions should be rectified for common mistake – common intention not established – whether walk out constituted acceptance of repudiation – walk out not clear and unequivocal acceptance
Legislation Cited:	Competition and Consumer Act 2010 (Cth), sch 2 (Australian Consumer Law), ss 18, 31, 237, 243 Fair Work Act 2009 (Cth)
Cases Cited:	Amoco Australia Pty Ltd v Rocca Bros Motor Engineering Co Pty Ltd (1973) 133 CLR 288 Application of Walker Corporation Pty Ltd [2022] NSWSC 160 Charltons CJC Pty Ltd v Fitzgerald [2013] NSWSC 350 Concrete Constructions (NSW) Pty Ltd v Nelson (1990) 169 CLR 594 Cushman & Wakefield Agency (NSW) Pty Ltd v Hudson [2023] NSWSC 218 Downe v Sydney West Area Health Service (No 2) (2008) 71 NSWLR 633 Dundoen Pty Ltd v Richard Wills (Real Estate) Pty Ltd [2020] NSWSC 1534 Extraman (NT) Pty Ltd v Blenkinship (2008) 23 NTLR 77 Hanna v OAMPS Insurance Brokers Ltd (2010) 202 IR 420 Idameneo (No 123) Pty Ltd v Angel-Honnibal [2002] NSWSC 1214 Immer (No 145) Pty Ltd v Uniting Church in Australia Property Trust (NSW) (1993) 182 CLR 26 In the matter of the George Hardi Family Trust [2021] NSWSC 1584 Isaac v Dargan Financial Pty Ltd (2018) 98 NSWLR 343 Jardin v Metcash Ltd [2011] NSWCA 409 Koops Martin Financial Services Pty Limited v Reeves [2006] NSWSC 449 Lane v Arrowcrest Group Ltd (1990) 27 FCR 427 McMurchy v Employsure Pty Ltd [2022] NSWCA 201 OAMPS Insurance Brokers v Hanna [2010] NSWSC 781 Otis Elevator Company Pty Ltd v Nolan [2007] NSWSC 593 Self Care IP Holdings Pty Ltd v Allergan Australia Pty Ltd (2023) 97 ALJR 388 Simic v New South Wales Land and Housing Corporation (2016) 260 CLR 85 Stellar Vision Operations Pty Ltd v Hills Health Solutions Pty Ltd [2023] NSWCA 102 Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd (2004) 219 CLR 165 TP ICAP Management Services (Australia) Pty Ltd v Howell [2021] NSWSC 656 Tullett Prebon (Australia) Pty Ltd v Purcell (2008) 175 IR 414 Walker v Salomon Smith Barney Securities Pty Ltd (2003) 140 IR 433 Watson v Foxman (1995) 49 NSWLR 315
Texts Cited:	M Leeming, “Subjective intention in the law of contract – its role and limits” (Speech, Bar Association of Queensland, University of Queensland and Supreme Court of Queensland Library, 1 June 2023 Meagher, Gummow & Lehane’s Equity Doctrines & Remedies Heydon JD, Leeming MJ and Turner PG, (5^th ed, 2015, LexisNexis Butterworths) [21-195]
Category:	Principal judgment
Parties:	Cushman & Wakefield Agency (NSW) Pty Ltd (Plaintiff/First Cross-Defendant) Rosa-lyn Hudson (Defendant/Cross-Claimant) Timothy James Molchanoff (Second Cross-Defendant)
Representation:	Counsel: D Mahendra/JVM Smith (Plaintiff/Cross-Defendants) BK Nolan (Defendant/Cross-Claimant) Solicitor: King & Wood Mallesons (Plaintiff/Cross-Defendants) Green & Associates (Defendant/Cross-Claimant)
File Number(s):	2023/76041
Publication restriction:	Nil