Louvain Nominees Pty Ltd v Cesure Pty Ltd

[2002] WASC 277 (S)

LOUVAIN NOMINEES PTY LTD -v- CESURE PTY LTD & ANOR [2002] WASC 277 (S)

Jurisdiction:	SUPREME COURT OF WESTERN AUSTRALIA	Citation No:	[2002] WASC 277 (S)
Case No:	CIV:2536/2002	Heard:	14 & 20 NOVEMBER 2002
Coram:	EM HEENAN J	Delivered:	20/11/02
Supplementary Delivered:	20/11/02
No of pages:	6	Judgment Part:	1 of 1
Result:	Terms of interlocutory injunction settled
Category:	B
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Parties:	LOUVAIN NOMINEES PTY LTD CESURE PTY LTD CHRISTOPHER FABIANO CANDELORO
Catchwords:	Interlocutory injunction Terms of restraint Turns on own facts
Legislation:	Nil
Case References:	Nil American Cyanamid v Ethicon Ltd [1975] AC 396 Amoco Australia Pty Ltd v Rocca Bros Motor Engineering Co Pty Ltd (1973) 133 CLR 288 British Reinforced Concrete Engineering Co Ltd v Schelff [1921] 2 Ch 563 Britten v Bishop, unreported; SCt of WA (Malcolm CJ); Library No 960560; 25September 1996 Brown v Brown [1980] 1 NZLR 484 Butt v Long (1953) 88 CLR 476 Castlemain Tooheys Limited v State of South australia (1986) 67 ALR 553 Cream v Bushcolt Pty Ltd [2002] WASC 100 Esso Petroluem Co Ltd v Harper's Garage (Stourport) Ltd [1968] AC 269 Evans Marshall & Co Ltd v Bertola SA [1973] 1 WLR 349 Hallmark Consolidated Ltd & Anor v Centaur Mining and Exploration Ltd (Administrators Appointed) (Receivers and Managers Appointed) & Ors [2001] WASC 190 Hoylevans Pty Ltd v Weit [2000] WASC 144 Laundry Coin-Wash Nominees Pty Ltd v Dunlop Olympic Ltd & Ors (1985) ATPR 40-584 Lindner v Murdock's Garage (1950) 83 CLR 628 Nordenfelt v Maxim Nordenfelt Guns & Ammunition Co [1894] AC 535 Patrick Stevedores Operations No 2 Pty Ltd v Maritime Union of Australia [No 3] (1998) 195 CLR 1 Peters (WA) v Petersville Ltd [2001] 181 ALR 337 State Transport Authority v Apex Quarries Ltd [1988] VR 187 Temwood Holdings Pty Ltd v Asean Australian Assets Pty Ltd [2000] WASC 84 Vancouver Malt and Sake Brewing Co Ltd v Vancouver Breweries Ltd [1934] AC 181 Walton's Stores (Interstate) Ltd v Maher & Anor (1987) 164 CLR 387 Weir v Hoylevans [2001] WASCA 23

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA

IN CHAMBERS

CITATION : LOUVAIN NOMINEES PTY LTD -v- CESURE PTY LTD & ANOR [2002] WASC 277 (S) CORAM : EM HEENAN J HEARD : 14 & 20 NOVEMBER 2002 DELIVERED : 20 NOVEMBER 2002 SUPPLEMENTARY
DECISION : 20 NOVEMBER 2002 FILE NO/S : CIV 2536 of 2002 BETWEEN : LOUVAIN NOMINEES PTY LTD

Plaintiff

AND

CESURE PTY LTD
First Defendant

CHRISTOPHER FABIANO CANDELORO
Second Defendant

Catchwords:

Interlocutory injunction - Terms of restraint - Turns on own facts

Legislation:

Nil

(Page 2)

Result:

Terms of interlocutory injunction settled

Category: B

Representation:

Counsel:

Plaintiff : Mr P P McCann
First Defendant : Mr M L Bennett
Second Defendant : Mr M L Bennett

Solicitors:

Plaintiff : Hotchkin Hanly
First Defendant : Bennett & Co
Second Defendant : Bennett & Co

Case(s) referred to in judgment(s):

Nil

Case(s) also cited:

American Cyanamid v Ethicon Ltd [1975] AC 396
Amoco Australia Pty Ltd v Rocca Bros Motor Engineering Co Pty Ltd (1973) 133 CLR 288
British Reinforced Concrete Engineering Co Ltd v Schelff [1921] 2 Ch 563
Britten v Bishop, unreported; SCt of WA (Malcolm CJ); Library No 960560; 25 September 1996
Brown v Brown [1980] 1 NZLR 484
Butt v Long (1953) 88 CLR 476
Castlemain Tooheys Limited v State of South australia (1986) 67 ALR 553
Cream v Bushcolt Pty Ltd [2002] WASC 100
Esso Petroluem Co Ltd v Harper's Garage (Stourport) Ltd [1968] AC 269
Evans Marshall & Co Ltd v Bertola SA [1973] 1 WLR 349


(Page 3)

Hallmark Consolidated Ltd & Anor v Centaur Mining and Exploration Ltd (Administrators Appointed) (Receivers and Managers Appointed) & Ors [2001] WASC 190
Hoylevans Pty Ltd v Weit [2000] WASC 144
Laundry Coin-Wash Nominees Pty Ltd v Dunlop Olympic Ltd & Ors (1985) ATPR 40-584
Lindner v Murdock's Garage (1950) 83 CLR 628
Nordenfelt v Maxim Nordenfelt Guns & Ammunition Co [1894] AC 535
Patrick Stevedores Operations No 2 Pty Ltd v Maritime Union of Australia [No 3] (1998) 195 CLR 1
Peters (WA) v Petersville Ltd [2001] 181 ALR 337
State Transport Authority v Apex Quarries Ltd [1988] VR 187
Temwood Holdings Pty Ltd v Asean Australian Assets Pty Ltd [2000] WASC 84
Vancouver Malt and Sake Brewing Co Ltd v Vancouver Breweries Ltd [1934] AC 181
Walton's Stores (Interstate) Ltd v Maher & Anor (1987) 164 CLR 387
Weir v Hoylevans [2001] WASCA 23

(Page 4)

1 EM HEENAN J: On 14 November I gave reasons for a decision granting an interim injunction to the plaintiff in this action designed to preserve the benefit of the restraint of trade attached to a surfing and leisure wear business conducted by the plaintiff in Albany and which the plaintiff had purchased from the defendants.

2 The restraints in the agreement for sale have already been described in my earlier decision but, at the risk of repetition, condition 4 of that contract provides:

"The vendor will not directly or indirectly and whether solely or jointly with or as a director, manager, agent or servant of any person or corporation, carry on or be engaged or interested in any business of the nature of the business hereby sold or any significant component thereof or permit the vendor's name or the names of any of them to be used in connection with such business."

3 The matter is back before me today in order to settle the terms of the restraint in a manner which will allow the practical implementation, supervision and, if necessary, enforcement of the injunction so long as it continues.

4 For reasons no doubt of practicality, the parties have sought to express the terms of the injunction by restraints directed to identifiable lines of merchandise stocked or previously stocked by the business and to direct the restraint against the defendants from retailing any of those identified lines. One can readily sympathise with the desire of the parties to devise a form of restraint which is sufficiently precise and identifiable to allow the subject matter to be immediately recognised and for the injunction to work. That is an important matter of practical utility.

5 Nevertheless, the attempt to identify lines in this way can only be done, in my view, in a manner which is consistent with the character of the general restraint and rather than an identification of lines, it seems to me that the important feature in identifying merchandise which is to be the subject of the restraint is to pose the question of whether or not the retailing of such products would be "to be engaged or interested in any business of the nature of the business sold or any significant component thereof". The nature of the business being sold has been generically, and somewhat loosely, referred to as a "surf and leisure wear" business.

6 In these circumstances, it seems to me to be necessary to characterise the merchandise in a way which will identify whether or not it was of a

(Page 5)

kind retailed by the business at the date of sale or its sale was in the nature of the business conducted at the date of sale. It does not seem to me, with respect, that those questions or that task of characterisation can be adequately performed by determining whether or not a particular line was being retailed at the date of sale or whether a new line, which was not being retailed at the date of sale but has since been retailed by the business, should be restrained. In each case, whether for discontinued lines, continued lines or new lines, the real question is whether retailing that line involves the conduct of the business, or a business of the nature of the business sold.

7 As with any exercise of drawing lines or making definitions in order to distinguish what is within or without some restraint or prohibition, the task can sometimes be arbitrary, but in this case it seems to be that no real effort has been made on either side to suggest that there has been a change in the character of the business conducted from the plaintiff's, formerly the defendants', store such as to change its nature as, for example, from a surf and leisure wear shop to a speciality shop or to a bridal wear shop or to an exclusively menswear shop or, for that matter, to a formal wear shop. It seems that the business which is being conducted, and which has been conducted since the sale, generally answers the description of a surf and leisure wear shop although the balance of merchandise held may have changed to some degree and there may be a greater leisure wear component than before.

8 It is important, in an interlocutory restraint such as the one which I have previously ordered that, generally speaking, the status quo which exists and which is being protected should be allowed to continue. The general status quo here is that the plaintiff had the right to retail surf and leisure wear in Albany without competition from the defendants in that line of business. Accordingly, it seems to me that the injunction which should be granted should be framed in such a way as will generally preserve the monopoly of the plaintiff to the exclusion of the defendants - I use the term "monopoly" in that limited and somewhat artificial sense - rather than to create a situation where there may be interminable disputes over whether a particular line of product or stock comes within or without the scope of the injunction.

9 In those circumstances, therefore, I consider that the injunction which I have ordered should include all the lines which were stocked at the date of the sale of the business, whether or not that business continues to retail them, and all new lines of a similar character regardless of the fact that they may not have been stocked at the time of the sale. The

(Page 6)

consequence of this is that I will modify the injunction so as to include all the items listed in Annexure A proffered by the plaintiff.