Goldsmith v Sandilands and Ors P16/2000

The High Court of Australia heard an appeal in *Goldsmith v Sandilands and Ors*. The dispute concerned the interpretation of a clause in a deed of settlement, specifically whether it conferred a right to seek an injunction to restrain a breach of that clause. The primary issue was whether the appellant, Mr. Goldsmith, was entitled to an injunction to prevent the respondents from continuing to operate a business in contravention of the settlement deed.

The central legal question before the High Court was whether the language of the settlement deed, which stipulated that the respondents would not "carry on or be engaged in or be interested in or concerned with any business of the same or similar kind" as the business previously conducted by a company, implied a right to seek injunctive relief for its breach. The court had to consider the nature of the rights conferred by the deed and the availability of equitable remedies for enforcing such contractual obligations.

The High Court, in allowing the appeal, held that the language of the deed clearly indicated an intention to confer a personal right on Mr. Goldsmith to restrain the respondents from engaging in the prohibited business activities. Their Honours reasoned that the undertaking given by the respondents was a promise to refrain from certain conduct, and the natural consequence of such a promise, in the absence of any express limitation, was that the promisee could seek equitable intervention to prevent its breach. The court affirmed that where a contract creates a negative covenant, the usual remedy for its breach is an injunction, provided the usual equitable considerations are met. The court ordered that the appeal be allowed and that the respondents be restrained from carrying on or being engaged in or being interested in or concerned with any business of the same or similar kind as that previously conducted by the company.