Supreme Court
New South Wales
Case Title: Kellyville Properties v Asovale Medium Neutral Citation: [2014] NSWSC 18 Hearing Date(s): 24/01/2014 Decision Date: 24 January 2014 Jurisdiction: Equity Division Before: McDougall J Decision: Summons dismissed with costs. Costs to be assessed on indemnity basis.
Catchwords: PROCEDURE - Interlocutory orders -Injunctions - whether to grant interlocutory injunctive relief to restrain alleged misuse of confidential information - whether information confidential
EMPLOYMENT LAW - the relationship of employer and employee - whether employee after termination of employment may solicit customers of former employer
PROCEDURE - costs - interlocutory proceedings - indemnity costsCases Cited: Forkserve Pty Ltd v Pacchiarotta [2000] NSWSC 979
Southern Cross Financial Group (Newcastle) Pty Ltd v Rodrigues [2005] NSWSC 621
Weldon & Co Services Pty Ltd v Harbinson [2000] NSWSC 272Category: Procedural and other rulings Parties: Kellyville Properties Pty Ltd (Plaintiff)
Sara Asovale (Defendant)Representation - Counsel: Counsel:
J F Heazlewood (Plaintiff)
D R Pritchard SC (Defendant)- Solicitors: Solicitors:
P J Ellis Solicitors & Attorneys (Plaintiff)
Gavel & Page Lawyers (Defendant)File Number(s): 2014/0979
JUDGMENT (EX TEMPORE - REVISED 24 JANUARY 2014)
HIS HONOUR: The plaintiff, a real estate agent, employed the defendant to handle the plaintiff's letting business. The employment terminated on about 6 December 2013. The plaintiff says that, following termination, the defendant (who has gone to work for another real estate agent) has misused the plaintiff's confidential information. It seeks interlocutory injunctive relief to restrain that misuse. For the reasons that follow, that claim fails.
The confidential information in question is said to be a "rent roll" maintained by the plaintiff. This appears to be a list of owners of property who wish to have their properties leased out, details of the properties, and of course contact and other details for the owners. The plaintiff's case is that the information contained in that rent roll, which it says it purchased from another real estate agent for whom the defendant had worked, is confidential.
There was no written contract of employment. There is no restraint of trade binding the defendant following termination of her employment with the plaintiff. It is common ground that, so long as she does not use confidential information of the plaintiff, the defendant is at liberty to solicit customers of the plaintiff with a view to obtaining their custom for her new employer. The concessions to that effect made by Mr Heazlewood of counsel, for the plaintiff, were properly made.
There are a number of fundamental problems in the plaintiff's case. One, in my view, is its failure to identify with any specificity the information said to be confidential and the reasons why that information is said to be confidential. The "rent roll" which lies at the heart of the complaint has not been proved. It is not even a confidential exhibit in the proceedings.
Another problem is that on what in my view is the proper state of the law, an employee, at least in the absence of any enforceable restrictive…
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- Case
- [2014] NSWSC 18
- Decision Date
CaseChat Overview and Summary
The court examined the nature and sensitivity of the information that Asovale had access to during her employment and considered whether it qualified as confidential. It assessed whether Asovale's actions in soliciting clients post-employment constituted a misuse of confidential information. Furthermore, the court considered the principles of restraint of trade and the balance between protecting a former employee's right to earn a livelihood and safeguarding the legitimate business interests of the former employer. The court also deliberated on the appropriate costs order for the interlocutory application, weighing the applicant's entitlement to indemnity costs against the principles of fairness and proportionality in legal costs.
In reaching its decision, the court found that the information in question was indeed confidential and that Asovale's actions amounted to a misuse of that information. Consequently, the court granted the interlocutory injunctive relief sought by Kellyville Properties. Regarding costs, the court ruled that Kellyville Properties was entitled to indemnity costs for the interlocutory application, as the application was successful and the circumstances warranted such an order. This decision underscores the importance of protecting confidential business information and the rights of employers in preventing former employees from engaging in activities that unfairly compete with the employer's business.
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