Emeco International Pty Ltd v O'Shea [No 2]

Emeco International Pty Ltd brought an action against Mr O'Shea, who had recently resigned from his employment with Emeco to take up a position with a competitor, NPE. The dispute centred on the enforceability of various restraints in Mr O'Shea's employment contract with Emeco, including non-competition, non-solicitation, and non-service of client restraints. The case was heard in the Supreme Court of Western Australia.

The primary legal issue was whether the restraints in Mr O'Shea's employment contract were enforceable. Specifically, the court needed to determine if the non-competition, non-solicitation, and non-service of client restraints were reasonable and, if so, what the appropriate relief would be. The court also needed to consider the implications of the wording of the restraint provisions and the circumstances in which Mr O'Shea had resigned and taken up a position with a competitor.

The court found that the non-competition restraint, which prohibited Mr O'Shea from working for or providing products or services to any dry hire company that competes with Emeco in Western Australia for six months, was reasonable. The court also found that the non-solicitation restraint, which prohibited Mr O'Shea from soliciting Emeco's employees or clients, and the non-service of client restraint, which prohibited Mr O'Shea from providing services to Emeco's clients, were not reasonable. The court noted that the restraints were only necessary to protect Emeco's legitimate business interests, and that the restraints should not go further than was necessary. The court granted an injunction to enforce the non-competition restraint and dismissed the application to vary the terms of the injunction.

The court also considered the costs application. The court found that the appropriate order for costs was that Mr O'Shea pay 90% of Emeco's costs to be taxed, if not agreed, on a party and party basis. The court dismissed the application for indemnity costs, finding that there was no justification for such an order.