ISS Facility Services Australia Limited v Grounds and Gardens Pty Limited

ISS Facility Services Australia Limited, the appellant, filed an appeal against the decision of an arbitrator, who found Grounds and Gardens Pty Limited, the respondent, had breached a restraint of trade clause in their licence agreement. The dispute was heard in the Supreme Court of New South Wales. The primary contention revolved around the interpretation and enforceability of a restraint of trade clause in a licence agreement between the parties, specifically whether the respondent's operations constituted a breach of the clause.

The central legal issues addressed by the court were whether the arbitrator correctly interpreted the restraint of trade clause and if the respondent's actions constituted a breach of that clause. The court also considered whether the respondent's business activities, which involved offering similar services in the same market, constituted 'competition' in breach of the restraint clause. Furthermore, the court had to determine whether the restraint of trade clause was reasonable in scope and duration.

The court found that the arbitrator did not err in interpreting the restraint of trade clause. The clause was clear in its terms, prohibiting the respondent from competing with the appellant in the same market. The court held that the respondent's operations, which provided similar services to potential customers, indeed constituted competition in breach of the clause. Additionally, the court considered the reasonableness of the restraint of trade clause and found it to be reasonable in scope and duration, as it was necessary to protect the appellant's legitimate business interests. Consequently, the appeal was dismissed.